Yellen, a former chair of the Federal Reserve, has sounded off on the need to address climate change. Climate activists now hope the department will guide the Biden administration’s tax, regulatory and budget policies with that in mind.
Climate change can hit the balance sheets of banks when fires and floods damage indebted homeowners and business — and when regulators take steps to cut emissions that leaves some companies, such as oil drillers, in a lurch.
Governments, Yellen said earlier this month, need to consider those liabilities “as a risk to banking organizations,” too.
The choice of Yellen, made public Monday, is both another sign of Biden’s government-wide approach to addressing climate change and the return of another Obama-era figure to the highest levels of government in Washington. This week, Biden also chose former secretary of state John Kerry to be his chief climate envoy.
The treasury secretary probably will be a key figure in addressing both climate change and the coronavirus pandemic.
Under President Trump, Treasury Secretary Steven Mnuchin spearheaded the move to prop up the economy during the coronavirus pandemic by distributing emergency funds. Should Congress pass another economic recovery package, Yellen would oversee the management of new stimulus funds.
As treasury secretary, she would also chair the Financial Stability Oversight Council, where she can play a role in getting banks and other businesses to assess and mitigate the risk that rising temperatures pose to their bottom lines.
That body was set up in the wake of the 2008 housing market crash to coordinate financial regulation and identify emerging market risks. Mindy Lubber, head of the sustainability nonprofit organization Ceres, said climate change is one of those new threats to the finance sector.
“If there is anything covid taught us, it’s that you can shock the system,” Lubber said. “We don’t want it to happen again. And climate risk is as great, if not bigger, than the subprime meltdown risk at the end of the 2000s, or covid risk.”
As the country’s chief tax collector, the treasury is also in charge of handing out tax credits to companies that operate solar panels, construct wind turbines and develop projects that capture carbon dioxide emissions.
Bracken Hendricks, a co-founder and senior policy adviser of the environmental group Evergreen, said he would like Yellen to consider boosting some of those clean energy tax breaks by turning them into direct grants — a move taken by the Obama administration during the Great Recession.
“Treasury can be catalytic in moving recovery funds into hard-hit domestic industries, like clean energy,” he said.
During the campaign, Biden also has promised to end subsidies for oil, gas and coal companies. Yellen would be able to reassess those tax breaks for fossil-fuel firms.
Yellen has been talking about climate change for a long time.
As an early backer of the Kyoto Protocol, a climate treaty scrapped by President George W. Bush, Yellen saw climate change as a risk to the financial system back in the late 1990s, when she was a top economic adviser to President Bill Clinton.
Since stepping down from the Fed in 2018, Yellen has backed the idea of taxing carbon emissions and returning the proceeds to Americans as a quarterly check — an idea popular with many economists and even with some former Cabinet officials for Republican presidents.
But in a paper published last month with Mark Carney, former head of the Bank of England, she wrote that “carbon prices alone are not enough.”
Yellen also called for compelling banks to run stress tests on their exposure to climate risk and companies to set targets for reducing emissions from their operations.
Left-leaning Democrats were pleased with the pick — mostly.
Yellen wasn’t the first choice of progressive climate activists. Among their favorites instead were Sen. Elizabeth Warren (D-Mass.) and former deputy treasury secretary Sarah Bloom Raskin.
But Moira Birss, co-coordinator of policy at Stop the Money Pipeline, said she was “cautiously optimistic” about the Yellen pick. She was among several environmental activists who brought attention to the importance of the Cabinet post for climate policy.
Birss would like to see the Biden administration take even more aggressive steps, such as putting in place capital requirements on banks lending to oil, gas and coal projects and limits on how much their portfolios can be made up of fossil fuels.
“The climate movement is going to be pushing really hard to make that happen,” she said.
PROGRAMMING NOTE: We won’t be publishing tomorrow and Friday in honor of Thanksgiving. Have a safe and happy holiday and we’ll be back in your inboxes on Monday.
Power plays
Carol Moseley Braun says she would like to serve as Biden’s interior secretary.
The nation’s first Black female senator, who represented Illinois from 1993 to 1999, told our colleague Juliet Eilperin that the role running the Interior Department is “a natural fit for me.”
But with relatively little experience with public lands, it would be an unconventional pick, Eilperin writes. The job usually goes to Westerners, with two of the leading contenders this time being from New Mexico: Rep. Deb Haaland, who would be the first Native American to run the department, and Sen. Tom Udall, whose father served as secretary in the 1960s.
Still, Moseley Braun was early backer of Biden — and she noted that she became interested in politics after helping preserve habitat for the bobolink in Chicago’s Jackson Park.
John Kerry will “have a seat at every table around the world,” Biden says.
In announcing his foreign policy security team Tuesday, the president-elect told reporters that Kerry, his new climate envoy, will “make sure climate change is on the agenda in the Situation Room.”
“As for the man himself, if I had a former secretary of state who helped negotiate the Paris Climate Agreement, or a former presidential nominee, or a former leading senator, or the head of a major climate organization for the job, it would show my commitment to this role,” Biden said during a speech in Wilmington, Del.
In his own remarks, Kerry said rejoining the Paris climate agreement alone “is not enough.”
Later, in Biden’s first post-election interview with NBC News, the president-elect said that one of his first actions upon assuming the presidency would be doing away with Trump’s executive orders on environmental issues. Biden said that these orders had hurt the climate and “eviscerated the EPA.”
EPA head Andrew Wheeler cancels Taiwan trip after criticism.
The planned trip elicited scrutiny after the New York Times reported that the charter flight to Taiwan was expected to cost more than $250,000. The EPA administrator was scheduled to discuss environmental issues related to air quality and marine life in Taiwan, but some critics wondered how productive the meetings would be, coming in the final weeks of the Trump administration.
On Tuesday, the Environmental Protection Agency confirmed to Bloomberg News that Wheeler had canceled the trip “due to pressing domestic priorities at home,” although he is still expected to travel to Latin America ahead of Biden’s inauguration on Jan. 20.
The Army Corps of Engineers gives a greenlight to the $2.6 billion Enbridge pipeline.
The agency approved a permit for the pipeline across northern Minnesota, clearing the last major hurdle for construction on the project, which could begin as early as next month, the Star Tribune reports.
Enbridge has said that the pipeline will create more than 4,000 jobs and allow for safer transport of oil, but environmentalists say spills could jeopardize pristine waters and that the pipeline will enable more burning of fossil fuels that contribute to climate change.
Environmental groups sue the EPA over a rule that allows toxic coal ash pits to stay open longer.
The lawsuit from nine environmental groups challenges a July rule that extends the time that coal ash pits can continue receiving coal sludge and adds additional time before companies must close the toxic pools, which mix residue from coal with liquid in often unlined ponds.
Environmentalists say that the extension, which allows some pits to stay open until 2038, will lead to toxins leaching into groundwater and drinking wells, the Hill reports.
Thermometer
The Swinomish tribe has ambitious plan to battle the effects of climate change.
Climate change has been a “gut punch” for the Swinomish, who live on a low-lying reservation on Fidalgo Island and fish the waters of northwestern Washington. One elder said that an annual ceremony to mark the beginning of the salmon fishing season has seen the tribe forced to buy and freeze fish because the catch is so depleted by lost habitat and warming waters, Jim Morrison reports for The Post.
So in 2010 “the Swinomish became one of the first communities to assess the problems posed by a warming planet and enact a climate action plan,” Morrison writes. “An additional 50 Native American tribes have followed, creating climate strategies to protect their lands and cultures, ahead of most U.S. communities.”
The tribe has restored tidelines and channels, planted trees along streambeds to cool warming waters, worked to rebuild oyster beds and put in place camera traps to monitor deer and elk populations and inform hunting limits.
The nation’s largest solar project is slated for development in northeast Texas.
Chicago-based company Invenergy announced plans to build a 1,310-megawatt solar energy facility in the Texas counties of Lamar, Red River and Franklin. The energy company has struck deals with major consumer brands — AT&T, Honda, McDonald’s, Google, Home Depot — that will get power from the center, a step toward achieving their sustainability goals. The project, which is expected to be completed by 2023, will also supply energy to the Texas cities of Bryan, Denton and Garland, the Times New Record reports.
Extra mileage
If you misplaced a big metal monolith in southeastern Utah, please pick it up.
Public safety workers in red-rock region were flying in helicopters to help wildlife officials count bighorn sheep when they stumbled upon the explained structure that might as well been out of “2001: A Space Odyssey,” our colleague Marisa Iati reports.
“We were kind of joking around that if one of us suddenly disappears, then the rest of us make a run for it,” pilot Bret Hutchings told KSL-TV.
