Pope Says No to Cap and Trade

By Tricia Caliguire

"Pope Francis Stands Up to Climate Deniers," or so says the editorial board of the Newark Star Ledger. Yes, but the headline could have read, "Pope says No to Cap and Trade."

In his ENCYCLICAL LETTER LAUDATO SI’ OF THE HOLY FATHER FRANCIS ON CARE FOR OUR COMMON HOME, Pope Francis calls for an honest discussion on environmental issues that divide us, both politically and geographically. While the advance press fed expectations that the encyclical would be all about climate change and humankind’s role in causing it, our read is that the Holy See’s perspective on climate change is part of a larger message. The Pope’s call for the use of renewable power over fossil fuels is there, to be sure. But that is just a part of his larger, anti-consumerism, pro-social justice message. In a document that will be widely used to prop up liberal causes, he reminds Catholics and non-Catholics alike of a duty to care for the earth that began with Creation and of the direction of the Creator to "till and keep" the earth. He laments that the inability – so far – to find solutions to pressing environmental problems is due in part to a "general lack of interest" and in part to the pursuit of financial gain without consideration of either the context in which such gains are made or the negative consequences.

From the Obama Administration’s perspective, the Pope’s timing could not have been better, as the government prepares to release the final Clean Power Plan (CPP) – the regulations issued pursuant to section 111(d) of the Clean Air Act setting carbon dioxide reduction targets for existing power plants – in August 2015, and to participate in the United Nations climate talks in December. As we have already seen with the CPP and as we are likely to see in Paris, there are no easy answers: "technology . . . proves incapable of seeing the mysterious network of relations between things and so sometimes solves one problem only to create others." To wit, cap and trade.

While the Pope is in favor of reducing the emissions of greenhouse gases, deep in the letter (page 128 of 184), he warns against the use of carbon trading to do so. Such schemes may in fact be a boon to consumer societies, allowing them to buy their way out of their environmental responsibilities "under the guise" of being green. Cap and trade, writes the Pope, "may simply become a ploy which permits maintaining the excessive consumption of some countries and sectors."

Here in New Jersey, we’ve seen how that operates. Environmental officials complain privately that the federal NOx trading system  allows upwind polluters to turn off expensive-to-operate control equipment when the cost of buying NOx allowances is lower. Close to half of New Jersey’s ozone travels in from other states. Meanwhile, environmental justice advocate Dr. Nicky Sheats, who is also Director of the Center for the Urban Environment at Thomas Edison State College in Trenton, has been advocating against carbon trading for years on the basis that it does more harm than good for traditionally underserved communities.

In 2008, Dr. Sheats was critical of the then-new Regional Greenhouse Gas Initiative (RGGI), a cap and trade system developed by 13 northeastern and mid-Atlantic states (in part to show the federal government how it could be done). He said, "we oppose carbon trading as a method to address climate change. RGGI gives little consideration to environmental justice issues. Carbon trading does not ensure emissions reductions in or near overburdened environmental justice communities and does not ensure that its operation will not create pollution ‘hot spots’ in or near environmental justice communities." In 2010, Governor Chris Christie recognized that RGGI was not responsible for lowering emissions but was responsible for raising electric rates, so he pulled the state out of the program.

More recently, Dr. Sheats has been making his point with EPA Administrator Gina McCarthy. He maintains that cap-and-trade approaches to reduce greenhouse gas emissions will put environmental justice communities at risk of exposure to more pollution. Rather than forcing power plants, particularly those located near "communities of color and low-income neighborhoods" to invest in pollution controls, a cap and trade system would allow them to invest in offsets.

The promise of proceeds from emissions trading programs to disadvantaged communities (such as that mandated by California Senate Bill 535)  is not enough. "We don’t want to give the impression that we would allow carbon trading in exchange for funds from carbon trading," said Sheats.

The Pope writes, "generally speaking, there is little in the way of clear awareness of problems which especially affect the excluded . . . due partly to the fact that many [opinion makers] are far removed from the poor, with little direct contact with their problems. They live and reason from the comfortable position of a high level of development and a quality of life well beyond the reach of the majority of the world’s population . . . [leading] to a numbing of conscience and to tendentious analyses which neglect parts of reality. At times this attitude exists side by side with a ‘green’ rhetoric."

If the above advice could rankle the left, as it does seem directed at those who travel by private plane to give speeches, raise money and collect awards for efforts to reduce global warming, then conservatives can’t be pleased with the most of the rest of the document, including the Pope’s recommendation for coordinated global action. The Pope doesn’t actually advocate against the very technologies that would lift impoverished peoples and nations (as he has been criticized for doing), he says it is time for the less developed part of the world to have their turn at them.

While the Pope calls for global action to address specific environmental goals, he argues that everyone can’t be held to the same standard. In church, congregants are often asked to sacrifice equally, though the amounts they give will not be equal. The Pope isn’t even saying that: "imposing on countries with fewer resources burdensome commitments to reducing emissions comparable to those of the more industrialized countries . . . penalizes those countries most in need of development [and perpetrates] a further injustice under the guise of protecting the environment." Giving credit to the South American church, he continues, "the countries which have benefited from a high degree of industrialization, at the cost of enormous emissions of greenhouse gases, have a greater responsibility for providing a solution to the problems they have caused."

Vatican City is not a member of the United Nations, but has been accorded a Permanent Observer Mission meaning that the Holy See has a standing invitation to participate as an observer in the sessions and work of the General Assembly. The Pope has just made the Paris talks that much more interesting.

   J. Wylie Donald, a partner at McCarter & English, LLP, counsels and litigates for clients on insurance coverage, environmental and products liability matters. Mr. Donald co-chairs the firm's Climate Change and Renewable Energy Practice. He draws on his substantial environmental experience, his prior non-legal technical work, and his deep involvement in risk management to assist clients in understanding and controlling the coming regulatory and non-regulatory impacts of climate change. He has tried cases and argued appeals in the state courts in New Jersey and Maryland, conducted private arbitrations and mediations, and argued motions in federal courts across the nation.

Read more at Climate Lawyers Blog by McCarter & English, LLP.

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