After inking a 2011 deal to export 24 million tons of Powder River Basin coal through the planned Gateway Pacific Terminal at Cherry Point in Washington, Peabody Coal CEO Gregory Boyce gushed, "We're opening the door to a new era of U.S. exports from the nation's largest and most productive coal region to the world's best market for coal."
Last March, John Kitzhaber and Jay Inslee, the governors of Oregon and Washington, respectively, wrote to the White House expressing near disbelief that the administration seemed prepared to let Big Coal's dreams come true. "It is hard to conceive that the federal government would ignore the inevitable consequences of coal leasing and coal export," they wrote. Coal passing through Pacific Northwest terminals would produce, they argued, "climate impacts in the United States that dwarf those of almost any other action the federal government could take in the foreseeable future."
But the administration refused to intervene. Appearing before Congress last June, the acting regulatory chief of the Army Corps of Engineers announced that climate pollution would not factor in the evaluation of permits for the export terminals. The burning of American coal in Asia, she testified, was "too far removed" to be considered.
Even more troubling, the administration opened up more than 300 million tons of coal in the Powder River Basin to bidding by the coal companies last year. The coal is on government land; it belongs to the public. Yet the leasing practices of the Bureau of Land Management (BLM) are so flawed that one independent study estimates that taxpayers have been fleeced of $30 billion over the past three decades. In the past, that stealth subsidy to Big Coal at least helped create cheap power for American homes and businesses. Today, the administration has put American taxpayers in the position of subsidizing coal destined to fuel the growth of our nation's fiercest, and carbon-filthiest, economic rival.
In the battle to prevent the United States from fueling the developing world's global-warming binge, the deck is stacked against climate hawks. The fossil-fuel industry remains the single most powerful special interest in Washington, having successfully ball-gagged the entire Republican Party on global warming. More insidiously, the macroeconomic indicators by which the economy – and any presidency – are measured can be cheaply inflated through dirty-energy exports, which boost GDP and narrow the trade deficit.
But here's the surprise: Climate activists are more than holding their own. Keystone XL is on an indefinite hold, and Whitehouse says he's "optimistic" that the pipeline won't gain approval on the watch of new Secretary of State John Kerry. Likewise, Obama's Powder River Basin initiatives seem to be going nowhere in the face of strong regional and national opposition. Even Wall Street is getting cold feet on coal. In January, Goldman Sachs dumped its stake in the Cherry Point, Washington, terminal once celebrated by Peabody Coal's CEO as emblematic of his industry's future. And with no clear path to China, coal companies themselves are pulling back. In two BLM auctions last summer, one failed to solicit any bids by coal companies; the other received a single bid – and it was too low for even the famously coal-friendly BLM to accept.
But preventing America from morphing into the world's dirty-energy hub will likely require something more: a competitive Democratic primary for 2016. By all outward indications, the Clinton regime-in-waiting is even more supportive of the dirty-energy trade than the Obama White House. Bill Clinton is a vocal proponent of the Keystone XL pipeline, calling on America to "embrace it." During Hillary Clinton's reign as secretary of state, the department outsourced its flawed environmental assessment of Keystone XL to a longtime contractor for the pipeline's builder, TransCanada – whose top lobbyist just happened to have served as a deputy manager for Clinton's 2008 presidential run. Clinton herself, in a 2010 appearance at the Commonwealth Club in San Francisco, sounded fatalistic about bringing tar sands to market: "We're either going to be dependent on dirty oil from the Gulf, or dependent on dirty oil from Canada," she said.
In a contested primary, the issue of constraining the nation's polluting exports is likely to emerge as a significant fault line between Clinton and whomever emerges to represent the Elizabeth Warren wing of the Democratic Party.
A credible challenger need not derail Clinton to make the difference. Recall that both Clinton and Obama began as reticent climate hawks in 2008 – even talking up the prospects of refining coal into a liquid for use as auto fuel – before the threat of John Edwards forced both candidates to commit to the ambitious goal of reducing climate pollution by 80 percent by 2050. On the other hand, if Hillary Clinton simply cruises through the primaries, it's a safe bet that the corporate center will hold – and that North America's fossil exports are going to flow. That's a state of affairs from which the world as we know it will not soon recover.
This story is from the February 13th, 2014 issue of Rolling Stone.
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