After the Republican win in Massachusetts, the odds of climate change legislation fall: That’s not good news for company profits

And what about climate change legislation in the U.S. Senate?

You’d think that after State Senator Scott Brown’s victory over State Attorney General Martha Coakley in the race to fill Ted Kennedy’s Senate seat in Massachusetts climate change legislation was dead as a door nail in the Senate.

But maybe not. The Obama administration has a big club on climate change legislation that it didn’t have on health care.

It’s called the EPA (Environmental Protection Agency). The EPA has already announced plans to regulate carbon dioxide and other green house gases as pollutants. And the Supreme Court has already ruled that the agency has the power to do that.

Any regulatory approach will be far more painful and expensive to industry than a subsidy-laden bill passed by Congress. Now it remains to be seen if industry hates the idea of EPA regulation enough and still carries enough clout with Republicans to make some Senate Republicans willing to give up the strategic political gains that come with opposing any legislation on the topic.

Brown’s victory gives Republicans in the Senate 41 votes. If the Republican minority sticks to together in opposition, as it has in the votes on health care legislation, that’s enough, given the Senate’s arcane procedural rules, to prevent any piece of major non-budget legislation from passing in the Senate.

Any piece of major non-budget legislation. If the Republican minority sticks together.

That certainly includes health care reform.

Global climate change. Quite probably, but not certainly. Read more

A cynical guide to profits from fighting global climate change

The vague, blatantly inadequate “agreement” wrangled out of the Copenhagen conference—or to give the meeting its official name The United Nations Climate Change Conference—by President Barack Obama is nonetheless a game changer.

Oh, not because any of the countries that the signed on to effort at global saving face have committed to actually do much of anything. But because the very inadequacy of this agreement forces all meaningful action back onto national governments.

If you want to know where the profits—and costs—of global climate change will be for the next decade, then I think you need to study not the technologies of climate change but the nature of the governments and economies that will stumble toward addressing this problem.

The nature of the U.S. economic and political system, for example, tells an investor a great deal about how to make money on global climate change in the next few years.  

Sometimes looking at the challenges of global climate change I think this problem was designed by some mad economist temporary sitting in God’s chair: It plays to just about every weakness in capitalist market economies.

Shall I count the ways? Read more

While everybody is watching Copenhagen, U.S. gets a climate change policy

Of course, it’s political window-dressing.

It gives President Barack Obama something concrete in hand to take to the global summit on climate change in Copenhagen.

But yesterday’s decision by the U.S. Environmental Protection Agency (EPA) to declare carbon dioxide a health hazard is also a real game changer. Now no matter what does or doesn’t get decided in Copenhagen, the U.S. has a carbon emissions policy.

Some business executives will cheer. What their companies have been arguing for is certainty. Tell us what the rules are so we know where to put our capital to work, said the companies that have broken with knee-jerk climate change opponent the U.S. Chamber of Commerce.

And those industries opposed to any kind of regulation of carbon emissions, which once had the option of trying to kill any legislation in the U.S. Congress, now face a stark choice: face relatively painful regulation by the EPA or hope to get a bill through the legislature that heads off the toughest part of the EPA rules. (I’m sure there will be legal challenges to the EPA rules but the court rulings so far have upheld the agency’s power to regulate carbon dioxide.) Or at least creates a chance to profit from the rules through a program of cap and trade that awards a juicy pot of trading credits to everybody from Jack’s pig farm to Jill’s steel mill.

Right now they’ve got a horrible deal, all stick and no carrot.

Here’s what the EPA has said it will do. Read more