Climate Change

Floor Speech

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Mr. WHITEHOUSE. Mr. President, I am here for my, oh, I guess umpteenth ``Time to Wake Up'' speech.

This one comes upon my return from Brazil, where I was the entirety of the United States of America governmental presence at the COP. That was it. Just me. Nobody else went. And not only did nobody else go-- this is not important to anybody really outside the Senate--but for my codel, my congressional delegation trip of one, the State Department, under President Trump, refused to facilitate my trip.

I think this is the first time where the Senate, the legislative body, has been told by the Executive branch: We are not going to facilitate a codel because we don't like what you are doing. I don't think that has ever happened before, and whatever your views are on whatever issue, I would caution that this is a gate we need to close shut because if the Executive branch of government can start telling the Members of the Senate what codels they can and cannot go on with State Department support and facilitation, we have got a real problem on our hands.

Here is my badge from the event, which the State Department refused to facilitate. So I was there as an observer of the Global Legislators Organization for a Balanced Environment, not the State Department. That is how we had to get around them.

So that is kind of a first, not mattering much, except that it is yet another executive-legislative tradition blown up by the arrogance of the Trump administration, their insistence that everything has to be their way.

But it is also a signal that this is how crazy they are on climate issues, how completely off base they are.

So I went down to Brazil--because that is where the rest of the world was gathering--to discuss the climate crisis. In the facility where we were, the kind of main intersection where the two big aisleways crossed was occupied by China, at one of the key corners, with a huge delegation, a very big pavilion, lots of activity and crowding, and all of the different countries that were there seeing the leadership of China--our rival.

No pavilion for the United States, nothing to be seen, nobody. Across the way, Saudis, not exactly the best friends of climate solutions.

So that was the environment that I went down to, and what I wanted to do was convey four messages.

Message one was: Donald Trump on climate does not represent the United States of America. He just doesn't. He represents the big donors who gathered at Mar-a-Lago, whom he asked for a billion dollars, and who gave him hundreds of millions of dollars in return for his promise to do whatever they wanted. It is that corrupt promise that explains Trump's behavior, not that he is representing the United States of America.

I thought this cartoon made a pretty good image of what is going on in the Trump White House.

And we know that he doesn't represent America because we can do things like test public opinion and polls. And I have a recent one here that asks about some of the sensible solutions to the climate change problem, to all the pollution spewing. Here is one: Carbon pollution limits on big companies.

Obviously, Trump would do everything he possibly could to prevent carbon pollution limits because his big fossil fuel donors wouldn't like that, and he is in tow to them. So zero chance that Trump would support that. But how about the American people? Mr. President, 12 percent opposed, 72 percent support. There is a 60-point margin among the American public on putting a pollution limit, a carbon pollution limit on big companies--72 to 12. That is where the American people are, not in the pockets of Big Oil.

Here is another one: Impose a fee on big polluters. It shouldn't be pollute for free. If you are polluting something, whether it is your neighbor's yard with your waste, your trash, throwing it over the fence or whether it is the river that you are dumping effluent into and ruining things for people downstream or whether it is our common atmosphere, if you pollute, you should pay for the cost of fixing it.

Better still, you should pay enough that you don't pollute in the first place and the neighbor's yard isn't a wreck of your trash and the river isn't dirty downstream and the atmosphere is safe.

Impose a fee on big polluters. Seventy-four percent of Americans liked that, 10 percent opposed. These are massive numbers in our line of work, in which we are always testing public opinion. And this is without much political pressure behind those ideas. This is just the American public in its natural state saying: Yes, by a better-than-60- point margin, we want to impose a fee on big polluters. We want carbon pollution limits on big companies. That is where America is.

Trump is in the pockets of the big polluters. So that was message one.

Message two was: We have got to put that price on carbon, the one that the American people want, because that is the only way we have remaining to climate safety. We have driven by all the other exits on the highway. We are now left with that. And that was my second point. We absolutely have to have what is called carbon pricing, a fee, a penalty, whatever you call it, for pollution.

This is part of a review from work that the Potsdam Institute did. They looked at 1,200 climate scenarios that over the years have been presented to the IPCC, 1,200. Of those 1,200, there are 11 left--11 out of 1,200--11 left that put us on a pathway to climate safety to get us back below the 1.5 degrees centigrade safety margin--maybe safety margin. But that is a conventional one, so I will stick with it, even though it is not a guarantee.

Every single one of them puts a price on carbon. No price on carbon, we fail. Other stuff that helps with climate, that may cause the airplane to crash higher up the mountain, but the only thing that gets the airplane safely across the mountain is putting a price on carbon. Twenty years ago, we probably had other alternatives.

Now, we absolutely must put a price on carbon. And so I, when I met with the Europeans and the Brits and the Australians, said to them: You have our last lifeboat. Don't let Trump sink it for his fossil fuel donors. What is the last lifeboat? It is called the carbon border adjustment mechanism. It is a global price on carbon that comes from tariffs. It is already law in the European Union, and it is about to go into effect next year.

Behind the European Union is the United Kingdom. Under a conservative government, the United Kingdom decided to join the CBAM. They are in the process of aligning their internal carbon prices, and they are in the process of figuring out how they are going to charge their own tariffs.

So you have the EU economy, and then soon, I hope, the UK economy joining, sending a global price signal that, if you are putting in goods that are more carbon intensive than ours, we are going to charge you for that. You cannot pollute and export for free any longer. This is a version of the ``can't pollute for free'' rule.

Pollute for free, by the way, is wrong--not just morally but as a matter of economics. You can go back to the most conservative economist, Milton Friedman, and he will say: Yes, if your product causes harm, if it pollutes, that is what economists call a negative externality. And the cost of that negative externality needs to be in the price of the product or else it is a subsidy, and it should be treated as a subsidy.

The subsidy for fossil fuel, just in the United States, is $700 billion every year. That is how much harm it causes. That is the value to the industry of ``pollute for free'' as their business model.

So the CBAM is beginning to put a price on pollution by causing a border tariff. To impose that price is really, really important.

These are those 11 remaining scenarios. Every single one crosses over 1.5; every single one requires, probably, direct-air capture to get the excess carbon dioxide and other pollutants out of the atmosphere and then bring it back down to safety--assuming no tipping point in here makes it irrecoverable.

So the way that I described it is that our last lifeboat to climate safety is the CBAM. It gets stronger if the UK joins. It gets stronger if the Australians join. They are looking at it as well. That makes it a sturdier lifeboat for all of us.

But we have to do it. It is not a guarantee of climate safety. But sinking that lifeboat is a guarantee of failure for us, for the next generation of young people, for their children and their grandchildren. We are done if we don't protect and, ideally, expand the CBAM.

So I urge all the countries participating in that: Stand by your guns. There is going to be a corrupt fossil fuel-driven attack on this. You can count on it. And be ready. Lock arms. Link up. Prepare yourself for the onslaught, and do not let yourself be cowed. Do not let yourself be stampeded.

So that was point two. Point three was: We have trouble coming. I call it the great climate insurance collapse. It is widely warned of. It is on its way. As I went around the COP, I handed out this little folder wherever I could, which lists just some of the climate economic catastrophe warnings that are out there:

[C]limate change could reduce the level of global GDP per capita by 10-20%.

This is Fed Chair Powell. He is on my sheet right here: In 10 or 15 years, there are going to be regions of the country where you can't get a mortgage.

Why is that? Because in those regions of the country you won't be able to get home insurance. And if you can't get home insurance on your property, if it has become uninsurable, no mortgage.

So what he is really saying here is whole regions of the United States are going to become so climate risky that they are uninsurable and, therefore, unmortgageable, and that is why, in those regions of the country, you will not be able to get a mortgage.

Think for a minute about what the economy looks like in an entire region of the country in which nobody can get a mortgage any longer.

Where is this likely to hit first? I will tell you a region that is headed for this fast is Florida. In Florida, the insurance market is already trembling, propped up, perhaps even fake. And if it loses that insurance market and Florida is a region in which nobody can get a mortgage any longer, well, that may be fine for Palm Beach billionaires who are swapping mansions with their extra money, but for a working person who has to get a mortgage to afford a house or for a working person who has a house on which he or she is paying a mortgage and now they need to sell it and they can't find a buyer because the buyer can't get a mortgage to buy the house because the house can't get insurance--the property is uninsurable.

That is how that cascade works. It goes from climate risk to uninsurability, to mortgage collapse, to property values collapse, to recession. That is what the chief economist for Freddie Mac predicted.

This guy, Fed Chair Powell, is not green at all. He is lousy on climate, but he is good on finance, and he sees this coming.

Freddie Mac is not a green organization. It is a mortgage company. So when its chief economist says we are headed for a 2008-style economic recession because there won't be mortgages because you can't get insurance so property values will fall so there will be that recession, you are hearing that from the finance community, not from environmentalists.

We go on. The Economist magazine, in an article entitled ``The Next Housing Disaster''--there is its cover; it was about a year ago-- predicted $25 trillion as the size of the hit to the global real estate market from this climate risk to insurance meltdown, to no mortgages, to property values collapse cascade--$25 trillion.

``Climate change, in short,'' it said, ``could prompt the next global property collapse.''

The president of Aon, one of the biggest insurance companies in the country, testified before the Senate Budget Committee:

Climate risk is a global, systemic risk.

What does ``systemic'' mean?

Climate change is a global, systemic risk.

What does ``systemic'' mean? Systemic is the scariest word in the economic lexicon. Systemic means that when things go bad, it is not contained to the place where the things went bad.

The 2008 recession was systemic, meaning that you didn't have to have a bad mortgage or you didn't have to be one of the financiers who crookedly packaged the bad mortgages to get clobbered. The damage was so deep in that part of the financial system that it cascaded out across the entire economy, and everybody got hurt. Car dealers, Realtors, small businesses, people who lost their jobs got hurt in 2008 because it was systemic.

Now you have got the CEO of one of America's biggest insurance entities warning us about this systemic risk.

Here is an even bigger insurance company, the biggest one in the world, Allianz, put one of its board members out to warn that if we get past the 1.5 degrees here and if you get up to 3 degrees, what happens at 3 degrees? Which, by the way, is very much what we are headed for right now. What happens at 3 degrees? Here is what he says:

[T]he financial sector as we know it ceases to function. And with it, capitalism as we know it ceases to be viable.

Same scenario: climate risk, insurance collapse, mortgage failure, property values crash.

The Mortgage Bankers Association:

[C]hronic physical risk associated with climate change may . . . exceed the capacity of insurance and government assistance to sustain some areas.

Whole regions.

By the way, the Allianz guy said the same thing about regions that Jay Powell did, that whole regions are becoming uninsurable.

The Financial Stability Board is the board that looks at the world's banking system. They have put out a warning saying, ``buckle up'' to the world's banks because if the climate risk to insurance collapse, to mortgage market failure, to property value crash transpires, the banks' balance sheets collapses. Its collateral value is gone. Its loan-to- value ratio makes it insolvent. And now you have a bank crash laid over the underlying great climate insurance collapse.

That is not from me. That is not from the League of Conservation Voters. That is not from the Sierra Club. That is from the international Financial Stability Board.

So that was the second message: Look out. This is about to get deadly serious, and people at the top of the finance profession are warning about it.

I will close with Bob Litterman. He was the chief risk management officer for Goldman Sachs, right? Goldman Sachs ain't green--except green with money. And he was their chief risk management officer. Here is what he told the Senate Budget Committee:

A sudden revision of market perceptions about climate risk-- i.e., the market realizes that climate risk is out there and has not been priced adequately into financial documents-- could lead to a disorderly repricing of assets, which could in turn have cascading effects on portfolios and balance sheets and therefore systemic-- Systemic-- implications for financial stability.

Like the Financial Stability Board said.

So I pointed out that this risk was looming, and we need to pay attention to it. This isn't about polar bears any longer. This isn't about green jobs any longer. This is a serious warning about a potential collapse in not just the United States but the global financial system. Remember The Economist magazine said that $25 trillion hit was coming to global real estate markets. That is what this article said.

So how do we prevent that? Well, one thing, as I said already, is you have to put a price on carbon. If it is free to pollute, you are going to get more polluting. There is no excuse for an industry polluting for free. There just isn't. It is morally wrong, economically wrong, environmentally wrong. It is wrong by the rules which your mom taught you--to clean up after your damn self.

But when it is $700 billion every year of harm that you are getting away with for free, that gives you a big reason as an industry to try to fake and lie and pressure your way through it. Now, you don't want to be caught doing that by your own name. You don't want it to be ExxonMobil that is doing all of this in its own name, so you have set up a whole scheme. But for $700 billion a year, you can spend a lot of money on setting up your whole scheme.

And sure enough, here is an image I have used on the Senate floor before. This is a web of all, not all, a significant number of the big front groups that the fossil fuel industry has propped up and funds to propagate its climate denial fraud operation--pretend that this isn't real, pretend that the scientists are just kidding or that they are making it up--and its dark money political corruption operation, which shovels billions of dollars into our politics to make sure that people obediently deny climate change in return for the money that keeps them in office.

So my final point in Brazil was, if we want to win this, we not only have to get the policy right, we have to tell the story right.

This is a story with a villain in it, just like a children's story that has a troll or a witch or an ogre or a dragon. You don't want to tell that story without the troll or the witch or the ogre or the dragon. First of all, it gets to be a really boring story, and second of all, it ain't the right story.

What we have is a situation in which we are in this peril that I described. We are in this peril because the fossil fuel industry has propped up this whole array of phony front groups to spread climate disinformation, stuff that just isn't true.

By the way, they don't care that it is not true. That is the point. So they don't stand corrected when somebody says ``Oh, that is not true''; they just dial up the volume and say it twice as much. It is not intended to be true. This is not a quest for truth; this is a barrage of noise and propaganda designed to cover the truth.

On the money side, we are into multiple billions of dollars that are poured into this building from fossil fuel industry coffers through all these phony-baloney front groups. I make fun of their names. I made up one: Rhode Islanders for Peace and Puppies and Prosperity--with nothing but a mail drop behind it. But behind the mail drop, creepy billionaires are shoveling in the money so people will ignore this problem for just another year, just another 2 years, just long enough to make a few more billion dollars in profit.

So that was my message.

Trump ain't us on this. Trump is the mouthpiece of the fossil fuel industry. The American public hasn't gone anywhere on this. He has just gone off on a fossil fuel-funded excursion.

If we don't protect the CBAM and put a price on carbon, there is no way out of this mess. We are totally toast, and we are going to see the looming edge of being totally toast coming through our insurance markets. It is already happening in Florida. Watch it. It is there.

I did a poll in Texas. Ninety-two percent of Texans are concerned about their homeowners insurance. Everybody talks about affordability here. They are concerned about their homeowners insurance affordability. They are more concerned about that than healthcare. They are more concerned about that than groceries. This is a top-of-mind concern because of wildfires, flooding, hail exploding the Texas homeowners insurance market.

Sixty-three percent say they are very concerned--very concerned. Sixty-six percent in oil patch Texas, in red Texas, in a State where zero effort has been made to connect the dots, understand that climate change links to extreme weather that is driving their homeowners insurance crisis--66 percent already get that. They are just being ignored because the fossil fuel industry can out-fog horn them with its propaganda and outspend them with its sluice gates open of dark money corrupting our politics.

That takes us to the last point, which is, yes, there is a villain in the story, and we need to put a spotlight on that villain and make them own the harm they are so dishonestly creating.

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