White House Presses Cap and Trade to Senate

By ROBERT SCHROEDER MarketWatch

WASHINGTON -- Cabinet officials pressed President Barack Obama's case for climate-change and clean-energy legislation at a Senate hearing on Tuesday as lawmakers clashed over whether a "cap-and-trade" system for cutting greenhouse gases would help the U.S. economy or hurt it.
"Denial of the climate-change problem will not change our destiny; a comprehensive energy and climate bill that caps and then reduces carbon emissions will," said Energy Secretary Steven Chu in remarks before the Senate Environment and Public Works Committee.
Mr. Chu and the secretaries of agriculture and interior joined the chief of the Environmental Protection Agency in making Mr. Obama's case to generally supportive Democrats and skeptical Republicans.
Members of the Senate Environment and Public Works Committee are taking up cap-and-trade legislation Tuesday following a narrow victory for it in the House last month. Under the system, pollution permits are bought and sold to meet emissions limits.
Sen. James Inhofe of Oklahoma, the panel's top Republican, said the cap-and-trade system would amount to the largest tax increase in American history, a statement echoed by many Republicans but shot down by Democrats including Sen. Barbara Boxer of California, who chairs the committee.
"There are no new taxes," Ms. Boxer said Tuesday morning.

Debate over the bill played out along similar lines in the House. A bill aiming to slash greenhouse-gas emissions to 17% below 2005 levels by 2020 cleared that chamber by a vote of 219-212 last month. By the middle of the century, it would cut emissions to 80% below 2005 levels.
Energy legislation that cuts emissions and invests in renewable sources of energy is one of President Barack Obama's top legislative priorities. Senate Majority Leader Harry Reid of Nevada has said he is hopeful the Senate will debate and pass a climate and energy bill this fall.
Mr. Obama is expected to tout U.S. efforts to cut greenhouse gases at the Group of Eight summit in Italy this week.
Meanwhile, the political climate for the cap-and-trade system remains tough in the Senate. Democrats hold a 60-seat majority thanks to the victory of Al Franken in the long-disputed race for a Senate seat from Minnesota. However, the cap-and-trade system makes even some Democrats nervous, especially those from states that extract energy and minerals and rely on heavy industry.
Ms. Boxer's committee won't be the only one to work on cap-and-trade. She and Senate Energy and Natural Resources Committee Chairman Jeff Bingaman and other Democrats in the Senate will work together on climate-change legislation.