Source: United States Senator Kevin Cramer (R-ND)
WASHINGTON – U.S. Senator Kevin Cramer (R-ND), member of the Senate Environment and Public Works Committee, penned an op-ed for the Wall Street Journal commenting on the European Union’s carbon border adjustment mechanism (CBAM) agreement. A proponent of an approach to trade and energy production which aligns climate and national security policy, Senator Cramer warns the EU of the inherent dangers of moving forward with this action unilaterally on the global stage.
“Despite an environment ripe for cooperation and collaboration on climate policy, the European Union has gone ahead with its carbon border adjustment mechanism, or CBAM, on its own. Instead, the EU should step back and work with the U.S. and other allies to develop a trade-centered approach that rewards high environmental performance and holds the world’s polluters accountable,” wrote Senator Cramer.
“In the past year, I met with several members of EU Parliament, including Mohammed Chahim, a lead EU negotiator, and European Commissioner for Energy Kadri Simson. My message was clear: Like-minded nations must build upon our shared geopolitical, environmental and trade standards to reward our producers and manufacturers for the good work they already do. I told them that a trade tiff could be averted if we coordinated on policy. Each time, they took a smile-and-nod approach and acknowledged the concern, but they haven’t changed course,” continued Senator Cramer.
“The U.S. has nothing to apologize for. The rest of the world needs to clean up. The U.S. has been the world leader in lowering carbon emissions—reducing emissions more than the next eight emissions-reducing countries combined from 2000 to 2016. Russia’s unwarranted war and China’s saber-rattling underscore the need for geopolitical cooperation now more than ever. The moment to work together on climate policy is here. The EU shouldn’t waste it by going rogue,” concluded Senator Cramer.
The EU Goes Rogue on Climate Policy With CBAM
By Senator Kevin Cramer
12.14.2022
“Despite an environment ripe for cooperation and collaboration on climate policy, the European Union has gone ahead with its carbon border adjustment mechanism, or CBAM, on its own. Instead, the EU should step back and work with the U.S. and other allies to develop a trade-centered approach that rewards high environmental performance and holds the world’s polluters accountable.
“In 2021, I led a cohort of my conservative colleagues in urging the Biden administration to oppose the EU’s unilateral implementation of a CBAM and support an alliance of developed countries on climate and trade policies. Rather than pitting responsible countries against one another, these policies should target the largest greenhouse-gas emitters. Sen. Chris Coons (D., Del.) and I raised this issue again in the spring as we pleaded with President Biden to work with European Commission President Ursula von der Leyen to consider trade policies that reduce global emissions and strengthen geopolitical alliances.
“A year ago, former national security adviser H.R. McMaster and I outlined a “carbon club,” a trade policy coordinated among modern nations centered around the mutual cleanliness of manufacturing and production policies. German Chancellor Olaf Scholz has also urged the Group of Seven nations to form an alliance based on shared climate policy standards that could impose fines on countries that don’t meet them. This approach would take advantage of modern nations’ purchasing power to target countries that profit from poor environmental standards, such as China and Russia.
“In the past year, I met with several members of EU Parliament, including Mohammed Chahim, a lead EU negotiator, and European Commissioner for Energy Kadri Simson. My message was clear: Like-minded nations must build upon our shared geopolitical, environmental and trade standards to reward our producers and manufacturers for the good work they already do. I told them that a trade tiff could be averted if we coordinated on policy. Each time, they took a smile-and-nod approach and acknowledged the concern, but they haven’t changed course.
“The CBAM as drafted would disadvantage the U.S., especially our small businesses and manufacturers, even though the U.S. and EU have nearly identical environmental performance and emissions standards. Particularly problematic in the EU agreement is the obligation for EU importers to pay the difference between the carbon price paid in the country of production and the price of carbon allowances under the EU’s emissions trading system.
“Many economies, including the U.S., rely on regulations under statutes such as the Clean Air Act to limit emissions. The EU’s proposal doesn’t credit the cost of domestic regulation when the border tax is applied. The failure to recognize the implicit costs of U.S. regulation would inevitably lead to double emission taxation on exporters. Further, because of Russia’s weaponization of energy, the U.S. has been forced to fill a massive natural-gas void, and electricity sources are a covered industry under the EU CBAM. Energy producers, who already deal with a high regulatory overhead, will be further burdened while seeking to help our EU allies.
“Establishing a carbon price isn’t necessary for reducing emissions, and it isn’t feasible on this side of the Atlantic. Inflation is still above 7% and is hammering Americans’ pocketbooks. A carbon price would serve as an additional hidden tax on nearly everything Americans purchase daily.
“The EU should work with the U.S. and other allies to design a common approach to climate and trade policy focused on the real problem—greenhouse-gas emissions growth from nations with lax environmental standards.
“The U.S. has nothing to apologize for. The rest of the world needs to clean up. The U.S. has been the world leader in lowering carbon emissions—reducing emissions more than the next eight emissions-reducing countries combined from 2000 to 2016. Russia’s unwarranted war and China’s saber-rattling underscore the need for geopolitical cooperation now more than ever. The moment to work together on climate policy is here. The EU shouldn’t waste it by going rogue.”