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Clinton Details Global Warming Plan

By Joby Warrick and Peter Baker
Washington Post Staff Writers
Thursday, October 23, 1997; Page A01

President Clinton pledged yesterday to "harness the power of the free market" for a multipronged assault on greenhouse-gas pollution, outlining a package of incentives and modest targets he says will counter global warming while allowing businesses to prosper.

Clinton released long-awaited details of his climate change policy in a speech that drew skepticism abroad and condemnations from both ends of the U.S. political spectrum. But others praised the president for committing to a serious, if cautious, plan for addressing what many scientists see as the planet's greatest environmental threat.

"We must begin now to take out our insurance policy on the future," Clinton told about 400 invited government officials and guests at the National Geographic Society. He said global warming "is real," and the "consequences, sooner or later, will be destructive for America and for the world."

Clinton outlined a strategy that beginning in 1998 would offer $5 billion in tax breaks and other incentives to U.S. companies to encourage rapid improvements in fuel efficiency and spur the development of new "clean-energy" technologies to reduce greenhouse gas emissions. He also called for an international emissions trading system that would earn credits for companies that cut pollution, and he promised further reductions under an ambitious restructuring of the electric utilities industry.

But the specific goals and timet ables he proposed for cutting international emissions fall far short of what some scientists and many environmentalists say are needed. They also are considerably less ambitious than the proposals proffered by other industrial powers.

The president's plan calls for stabilizing the industrialized world's output of carbon dioxide and other greenhouse gases at 1990 levels between 2008 and 2012 -- followed by further, unspecified reductions by 2017. The European Union, by contrast, favors limiting emissions at 15 percent below 1990 levels by 2010.

Talks are underway this week in Bonn, Germany, to try reach an agreement on an international plan to be signed in December in Kyoto, Japan. The treaty would set mandatory ceilings on emissions by nations around the world and impose penalties on countries that fail to comply.

Some business and labor groups say that even the relatively modest restrictions sought by Clinton would strangle the economic growth, raise energy prices and put millions of people out of work. But Clinton said his program would actually boost the economy by increasing efficiency and creating opportunities for new products and markets.

"If we do it right, protecting the climate will yield not costs, but profits, not burdens but benefits, not sacrifice, but a higher standard of living," he said.

White House officials portrayed the policy as "bold" and a "win-win," saying the tax breaks, flexible guidelines and other inducements would minimize the negative impact on industry and result in deep reductions in pollution before the mandatory limits even kick in.

Officials said the plan does not mandate any increase in energy costs, but they acknowledged that prices for gasoline and other fuels could rise. The administration released no economic analyses showing what impact binding targets might have, saying it is virtually impossible to predict the effects 13 years into the future.

But congressional and industry opponents said Clinton's proposed "cure" would be far worse than the disease -- if global warming is indeed a threat at all. A coalition representing oil companies, electric utilities, automobile manufactures and farm groups have launched a multimillion dollar advertising to generate opposition to a treaty in Kyoto.

"The Clinton-Gore global climate plan threatens the quality of life for all Americans," said Rep. F. James Sensenbrenner Jr. (R-Wis.). He said the restrictions would "result in higher energy prices for working Americans and send U.S. jobs overseas."

But some business groups -- especially those representing alternative energy technologies -- praised the president's plan. "This is a measured, appropriate action plan, given what we know about global warming," said Terry Thorn, senior vice president of Enron Corp. of Houston.

More than a dozen senior executives representing such companies as Nike Inc., Bechtel Group Inc. and Mitsubishi Motor Corp. have endorsed a newspaper ad running this week that calls for "strong leadership" by the United States on climate change.

Reaction among environmental groups was mixed. Several mainstream groups that were prepared to endorse the president's package were deeply disappointed when the final details became public. "The air went out of the balloon," said John Adams, executive director of the Natural Resources Defense Council.

"The president has recognized that the global warming train is bearing down on the planet. But the policy announced today will not go nearly far enough to get us out of harm's way," Adams said.

The proposal falls short of the goals that Clinton outlined in 1993, when he called for voluntary cuts in greenhouse gas emissions to 1990 levels by 2000. The administration says that goal is not longer possible because the economy has grown more rapidly than expected.

Some environmentalists said the incentives for immediate cuts in greenhouse gases in the new proposal more than atoned for any shortcomings in the proposed pollution ceilings and timetables.

"The president's proposal puts the United States in the thick of the negotiations rather than on the fringe," Michael Oppenheimer, an atmospheric physicist with the Environmental Defense Fund. "For the first time there is a good chance of a constructive outcome at Kyoto."

Still, with less than two months remaining before the Kyoto conference, the administration faced a difficult task in closing the gap between its proposals and those of its European and Japanese allies.

Administration officials found little encouragement in a new proposal by developing countries, which yesterday called for cuts even more ambitious than the Europeans' -- while essentially exempting themselves from any binding limits in the near future.

A statement by the "Group of 77" countries in Bonn sought commitments from wealthier nations for a 35 percent reduction in greenhouse gases by 2020. It said poorer countries should be compensated for economic hardships that might result from efforts by the West to cut pollution at home.

Clinton, in his speech yesterday, said the United States would insist on participation by developing countries as a condition for signing any global treaty on greenhouse gases. But he gave no specifics.

"Exactly what participation will mean is obviously what our guys are going to be doing in Kyoto," said White House economic adviser Gene Sperling.

© Copyright 1998 The Washington Post Company

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