MR. MARLO LEWIS: Good evening everyone. This is the concluding portion of our program. Thank you all for staying. A little while ago, we were reminded that Ross Gelbspan accused a tiny band of skeptics of exerting a disproportionate influence on the climate change debate and it struck me that exerting influence out of proportion to one's numbers is what leadership is all about. We are all here, I think, indebted to people like Pat Michaels and Fred Singer for exerting an influence out of proportion to their numbers. Each has the strength of 10 or maybe 100. And a similar phenomenon, I think, has – is observable in the US Senate where also a tiny band of skeptics, of doubters, of people who just want to really figure out what's best for America are exerting an influence out of proportion to their number. And we are very fortunate to have the leader of these leaders here with us today.
Senator Chuck Hagel is on the Foreign Relations Committee of the Senate which is the chief committee of jurisdiction in this whole debate. And so whatever happens in Kyoto, whatever kind of agreement our negotiators eventually sign their names to, what really matters is the action that the US Senate will take. Will it ratify? Will it not ratify? And in the interim, what really matters is the actions that the Senate will take to build a coalition for a sensible approach to this whole subject and to shape public opinion.
Senator Hagel has been at the forefront of these efforts. He has organized two hearings already, one on the science of climate change policy, one on the economic impacts. He has also been the chief co-sponsor of a resolution which has put the administration on notice that the majority of the US Senate, including many Democrats, will not put up with a treaty which seriously harms the United States economy. So again, I think we're in the presence of strength here and leadership and since the Senate will be the critical battleground in this entire process, where the high drama will really take place, we are very fortunate to have Senator Hagel here deliver the keynote remarks for our conference.
I mentioned that he is on the Foreign Relations Committee. He serves as chairman of its Subcommittee on International Economic Policy Export and Trade Promotion. And prior to his election to the US Senate, Senator Hagel was president of McCarthy and Company, which is a privately owned firm in investment banking in Omaha. So he is someone who brings to the US Senate a private sector perspective which is very healthy and very welcome. He also served as deputy director and chief operating officer of the 1990 Economic Summit of the G-7 countries, so he is familiar with the whole milieu and procedures of these international negotiations.
So, without further ado, I would like to turn over the podium to Senator Hagel and please give him a very warm welcome. Thank you.
SENATOR CHUCK HAGEL (R-NE): Thank you very much and good afternoon. I know you've had a long day and I appreciate very much an opportunity to say hello this afternoon. We have a vote scheduled sometime in the next few minutes, so that might be a fortunate reprieve for all of you. But I don't plan on droning on forever. I do want to say to CEI and all of you who have put this together, I very much appreciate the opportunity that I have to participate. But beyond that, thank you for doing this because, like everything, we should provide information and knowledge. And that's how we have come at what we're doing in the United States Senate about this issue. And hopefully we will be better informed. So you provide a very significant service to all of us, to my colleagues and I and others who need to know more about this issue. We should not be afraid of airing it out, debating it. Let's find out where we are.
And I'd like to focus my remarks this afternoon really on that general theme because that has been the spirit of the hearings that we've held. I didn't go into these hearings with any particularly preconceived idea or concept, certainly not an understanding of all the dynamics and the elements of this issue. I don't know. And I'm not afraid to tell you I don't know. I don't think there are very many of us that really know what's going on out there with this issue. And if we are to make hopefully an informed judgment in the United States Senate about a treaty, or make some decisions about this issue, then we should know a little bit about what we're talking about.
I have prepared some written remarks and I'm going to follow those somewhat because I don't want to waste your time by meandering around. And we have copies of the remarks if you'd like. So let me begin this way. As I said at the first hearing that we held, I've yet to meet one American, one member of Congress who does not support clean air, clean water, clean environment. If there's someone out there, I've yet to meet them. The point being that that's not the issue. And those of us who do probe and question tend sometimes to get locked into a position of, “Well, but you're against the environment. And you tend to always favor the economic dynamic of the argument.” Well, we have kind of done that to ourselves over the years when we do ask, dare to probe and dare to question what many just automatically accept based on what's good for the environment or what some think is good for the environment. And I've tried to come at this with a little different attitude with that questioning upfront. And from that, let's let everybody have a shot at this. Let's let everybody say their piece. And let's listen to the scientists. Let's listen to the climatologists. Let's listen to the economists and see what we have.
I think how our nation addresses this issue will prove to be one of the most significant decisions that we make over the next few years because it does affect — it will affect, it has affected — so much of our lifestyles, our standard of living, our economy, our jobs, growth, fuel use, fuel costs. Part of this debate hasn't really even been raised yet and that's national defense. We haven't even thought about that, really. And for me, one of the most poignant questions and concerns is about national sovereignty. Because if we are to reach out and go forward with a multinational kind of an institution organization that will be empowered to not just be the referee here, but be essentially the judge, the jury, the prosecutor. How will that work? Who is wise enough among all the nations to do that? I really wonder if the United States of America is prepared to allow an international body to essentially invade our industries and our country with the power of shutting them down and throwing people out of work. First time it's ever happened -would happen – in the history of this country.
Those are some of the questions that are pretty important that we need to ask, we have been asking. But as much as anything else, we need to come at this based on good science and common sense — good, sound science and connect that with common sense. We should not rush headlong into these things until we're sure we have a problem and then fully explore that problem and understand and be aware of the consequences.
Over the last few months, the United States Senate has sought to answer many of these questions. What we've heard has some very troubling implications for this country, for our future. Why are we in the United States Senate taking a very proactive approach to this treaty, to this issue? As was noted, any ratification of a treaty requires a two-thirds majority vote. That's 67 votes. For that reason alone, it makes little sense not to try and affect the negotiations of a treaty. The US Senate has an equal obligation under the constitution to provide its advice during the negotiation of treaties. The credibility of the United States government is surely not enhanced when the administration negotiates a treaty that has no hope of ratification in the US Senate. And I would tell you, ladies and gentlemen, that is the case today, with what we know of this situation. Therefore, we have been and will continue to be very active in this area. Not only my subcommittee and the Foreign Relations Committee has held hearings. John Chafee's committee, Environment Committee, last week held hearings. House Commerce Committee held hearings today. There will be more hearings. And there should be.
But let me return to some of the basic questions that we have here. What is the problem? If there is a problem, what's the best solution? What are the costs? What are the consequences? And what should we do now, if action is required now? Let's look at the problem. If anything has become very clear during congressional hearings on this issue — and today's hearings were no exception — is that the scientific community has not definitively concluded that we have a problem with global warming. The science is inconclusive. The implications are unclear. And predictions for the future range from no significant problem to global catastrophe.
The subcommittee that I chair, as I mentioned, has held two hearings. We heard testimony from many preeminent individuals, leaders in this area, one being one of those individuals that you heard from today, Pat Michaels. As you know, Dr. Michaels, before our committee, and I suspect today, noted that conditions in the real world simply have not matched changes projected by some computer models. Most of the warming this century occurred in the first half of the century before – before — significant emissions of greenhouse gasses began. And 18 years of satellite data actually shows a slight cooling trend.
Just last week before the Senate Environment Committee, Dr. Richard Lindzen, professor of meteorology at the Massachusetts Institute of Technology testified, and I quote, “that a decade of focus on global warming and billions of dollars of research funds have still failed to establish that global warming is a significant problem.” End of quote. At that same hearing last week, before Senator Chafee's committee, Dr. John Christy, as associate professor at the Department of Atmospheric Science at the University of Alabama stated, quote, “Satellite and balloon data show that catastrophic warning and warming is not now occurring. The detection of human effects on climate has not been convincingly proven because the variations we have now observed are not outside of the natural variations of the climate system.” End of quote.
Many of you may have also read the July 9 article in the Washington Post last week by the highly respected columnist Robert Samuelson. In that piece, Mr. Samuelson, I think, did an excellent job of pointing out the inconclusiveness of the scientific data, the uncertainty of the future effects of greenhouse gasses and the ramifications for the United States' economy and the global economy. Anyone — and I suspect who participated in today's conference — knows that there are many among the scientific community, within the private sector and in the world of politics who have long been making the case that we simply do not know whether or not global warming is taking place.
So indeed, there remains great uncertainty with the science. In fact, as computer modeling has improved, more questions arise and it is clear that the global climate is incredibly complex. It is influenced by far more factors, as you know, than originally thought when we looked at earlier, more crude computer models. Whether we are experiencing global warming is still very unclear.
What is the problem? At this point, the best answer is we don't know. And this leads us to the second question, what's the best solution? Well, common sense dictates that you don't come up with a solution to a problem until you have a problem. Once it's determined there is a problem, the solution has to be based on a clear understanding of that problem. However, the Clinton administration has proceeded to negotiate a solution before we have confirmation of a problem. They have proposed that the US and other developed nations submit to legally binding controls of greenhouse gas emissions – of greenhouse gas emissions and are now negotiating the language for a UN global climate treaty that would be signed this December in Kyoto. However, this treaty will not include legally binding emissions standards for more than 130 developing countries, developing countries that include China, Mexico, Singapore, South Korea, many others. This makes no sense. This makes no sense. Given that these nations include some of the most rapidly developing economies in the world and are quickly increasing their use of fossil fuels. By the year 2015, China will surpass the United States as the largest producer of greenhouse gasses.
As Senator Robert Byrd has stated, and I quote, “In what can be only be viewed as environmental irresponsibility, the developing nations have adamantly refused to recognize that they will, over the next two decades, become the primary cause of the problem in terms of annual emissions. I believe that if the treaty we are negotiating today does not equally commit developing nations like China to binding commitments, there will be no incentive for China and the other 130 nations of the developing world to make responsible and environmentally sound choices as they develop.” End of quote.
The US and other developed nations are the ones who are currently doing the most to reduce the greenhouse gas emissions. It's the developing nations that will be the biggest emitters of greenhouse gasses during the next 25 years. It is complete folly — complete folly — to exclude them from legally binding emissions mandates, but yet bind the developed nations. How could any treaty aimed at reducing global emissions of greenhouse gasses be at all effective when it excludes these 130 nations? Well, it won't. It won't be effective if these nations are excluded.
Some analysts have even cautioned that the unequal treaty being negotiated at the UN could increase the emission of greenhouse gasses. As industries flee the United States and other industrialized countries, they would reestablish themselves in developing countries that have much weaker environmental standards than our own, like Mexico. Like my friend from Kentucky, Senator Wendell Ford said recently, this treaty is great news if you want to buy all of your energy from Mexico.
Now if this isn't compelling enough, what are the costs? One of the notable aspects of this issue is that it has united American business, labor and agriculture. In my hearings, we heard testimony from the AFL/CIO, the American Farm Bureau and the National Association of Manufacturers and many noted economists. They all agreed on one thing. The draft UN treaty now under consideration would have a devastating effect on American consumers, workers, farmers and businesses. Estimates of the proposed treaty's damage to our economy vary, but mainly because the administration has still not released its own economic assumptions. The administration promised to provide its economic model more than a year ago, but has still not been forthcoming with this information. I understand today again, at the House hearing, Congressman John Dingell pressed the administration witnesses. And before my subcommittee he appeared and asked again — he asked Undersecretary Wirth, “Where is the administration's economic model?” But still we don't have those numbers. We don't have that model.
The bottom line is clear, even using conservative assumptions. For example, Charles River Associates, who testified before my subcommittee, an economic modeling firm, has estimated that holding emissions at 1990 levels would reduce economic growth by one percent a year. They acknowledged that that was conservative. That would rise to three percent, a reduction in economic growth rising to three percent a year in a few years. That doesn't even consider what Undersecretary of State Worth said at that hearing, and I understand he repeated it today, that his long term goal was achieving 70 percent reduction from the 1990 emission levels.
What this means to everyday Americans is pretty clear, ladies and gentlemen. It's been estimated that stabilizing emissions at 1990 levels alone would double electricity prices, conservative estimates, would require a tax equal to at least 40 cents a gallon gasoline. The AFL/CIO has estimated that the treaty would mean the loss of a one-and-a-quarter to one-and-a-half million American jobs. Jerry Jasinowski, president of the National Association of Manufacturers testified that the proposed treaty would hurt American manufacturers, workers, families, with little or no environmental benefit, since new restrictive policies in the US simply would force the flight of US investment to developing countries. Millions of Americans would lose their jobs and American manufacturers would take a severe hit in the marketplace.
What about the effects on American agriculture? It's little known that American agriculture produces 25 percent of our nation's greenhouse gas emissions, which would make this critical sector of our economy vulnerable to the kind of major reductions envisioned by the UN Global Climate Treaty. The American Farm Bureau, testifying before my subcommittee, stated that the treaty would be a back door BTU tax that would drive up fuel and overall energy costs as much as 50 percent. I think, as most of you know, farming is a very energy-intensive industry. Fuel increases of 50 percent would drive many American farmers out of business.
Now this comes at a very interesting time. This comes at a time when America is more the world's bread basket than anytime in the history of man. It comes at a time when the Earth's population is expected to double in the next 50 years. We will need the full capacity, beyond the capacity of what the American farmer is capable of today, to feed the world. It's not the time to impose severe additional production costs on America's farmers. And again I ask the question, for what? The great irony here is that some scientists argue that agriculture works also as a carbon sink that actually removes carbon dioxide from the atmosphere. If this is true — moderately true, maybe true — forcing farmers out of production could actually increase greenhouse gas emissions.
Now what are the other consequences of a UN Global Climate treaty? Undersecretary Wirth has put this country in the unenviable position of supporting a negotiating position that will place new internationally legally binding mandatory regulations on our domestic companies while allowing for only voluntary — voluntary — standards for our competitors in over 130 other nations. So while the consequences for the United States would be severe economic harm, the consequences for 130 other countries would be economic advantage over the United States. And again I ask the question, for what?
A draft report of a yet officially unreleased economic study commissioned by the Department of Energy reportedly concludes that, quote, “policy constraints placed on six large industries: petroleum refining, chemicals, paper products, iron and steel, aluminum and cement would result in significant adverse impacts on the effected industries. Furthermore, emissions would not be reduced significantly. The main effect of the assumed policy would be to redistribute output, employment and emissions from participating to non-participating countries.” End of quote.
One of the most disturbing aspects of this treaty is the threat to US sovereignty. As I said earlier, who would administer this? Have we thought through that? I asked Secretary Wirth when he was before my subcommittee, have we given any thought to this? How does this work? Has the UN talked about this? Is this country really ready and prepared to turn over its industry and responsibility for its manufacturing to multilateral international organizations with the power to close our own industries down? I don't think so. This senator is not ready to go that way and I don't think you'll find 67 senators in this United States Senate that will be willing to step up and do that and put this country in that position.
So, what should we do now? Well, I've concluded that maybe part of the answer is that we should slow down. Don't stop. Continue to search for the truth. Find the answers. Find the facts. But there is absolutely no reason for the United States to rush headlong into signing a treat in Kyoto this December. It would be foolhardy for America to sign up to a legally binding obligation to be policed by a multilateral international organization, especially given the scientific uncertainties and serious economic harm that would occur. It would be counterproductive because any such treaty would have virtually no chance of being ratified by the United States Senate.
I've been working with a number of my colleagues over the last few months to put together a strong bipartisan coalition on this issue. There are now 65 co-sponsors of the Byrd-Hagel resolution which my committee, the Foreign Relations Committee, will mark up later this week. The Byrd-Hagel resolution voices a strong objection to the administration's position in the current UN negotiations and lays down a bottom line for any climate treaty that might come before the Senate. The resolution which, again, has already been signed by 65 senators, states that the administration should not sign any treaty that does not include the 130 developing nations or that would cause serious economic harm to the United States. Any treaty that does not fit those parameters would face the likelihood of a crushing defeat in the United States Senate.
I said at the outset that I believe any action should be based on sound science and common sense. The current track of negotiations for the UN Global Climate Treaty does neither. Why is the administration rushing headlong into signing a treaty in December? The scientific data is inconclusive, at times even contradictory. The economic costs are clear and devastating. This treaty would be a lead weight on our nation's future economic growth, killing jobs and opportunities for generations of Americans.
We need to take global climate issues seriously. We in the United States have made tremendous strides in cleaning up our environment. We need to do more. We will continue to do more. We're all concerned about the state of the environment and what we leave our children and our grandchildren, but when we take actions that will reduce their economic opportunities, their standard of living and put them in an inferior global competitiveness position, we're not helping. We must ensure that the benefits would be real to whatever action we take and that they would justify the economic hardship if that's required, if that is the problem, if that is the solution, if that is what's required. Justify that action that we would be passing on to future generations.
Ladies and gentlemen, I appreciate very much an opportunity to share some of my thoughts with you. And again, I want to thank CEI and all of you who have been so involved in this issue over the years. I am a newcomer to the Senate. I'm a newcomer to this issue. But I can tell you, in my 50 years, things that work best are always a result of getting the best information, of reaching out and asking the best minds to be involved, probing, searching, don't be afraid of the truth and then we'll figure out a good solution. And this to me is a classic example of that standard. And I believe that we will find some answers as we develop theories, as we look closer, as we explore the facts. But we should not be driven by emotion. We should not be driven by what a few people believe. We should be driven by what's real. And for all of you who have done so much, I'm grateful and I'd be very happy to answer any questions. Thank you. Thank you.