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Resources for the Future Policy Leadership Forum: Climate Change Discussion with the EPA
September 26, 2014

September 25, 2014

ADVISORY: Remarks by EPA Administrator Gina McCarthy at Resources for the Future
As Prepared for Delivery Sept. 25, 2014


Thanks, Phil.  It’s great to be here at RFF.  The expertise and integrity of this organization is testament to your leadership, Phil, and the passion of the people who work here.

I want to start with a story decades in the making.  Forty years ago, scientists at the University of California uncovered a global crisis.  Chemicals in our hairspray, refrigerators, and air conditioners were destroying our ozone layer, the Earth’s protective shield against the sun’s cancer-causing radiation.  The world needed a solution.  It needed a leader.  The United States didn’t temper its resolve, despite the hesitation of other nations.  American science identified the problem.  American industry innovated the solution.

Because we acted, the ozone layer is healing.  Our people are safer.  And our economy is stronger.  Our fight to save the ozone layer was a defining moment in American leadership.  Today, with the threat of climate change, the pollution and the problem are different, but the principle is the same.  Once again, the world needs a leader.  Once again, that leader must be the United States.  That’s the message President Obama took to the UN this week.

The President said, quote, “We cannot condemn our children to a future beyond their capacity to repair…not when we have the means…to begin repairing it right now.”  He’s right.  Climate change supercharges risks to our health and our economy.  The thing is, we don’t have to choose between a healthy environment and a healthy economy.  They’re not separate—they’re intertwined.  A world-leading economy depends on a healthy environment and a stable climate.

That’s why under President Obama’s direction, EPA proposed a Clean Power Plan to cut the harmful carbon pollution fueling climate change from our largest source, power plants.  I was at the climate summit this week, and one thing is clear: U.S. climate action is changing the game.  Our leadership is spurring action from government and business leaders around the world.

What’s also clear, is that when it comes to climate change, the most expensive thing we could do, is to do nothing.  We no longer project tomorrow’s impacts, we tally up today’s damages.  This past decade was the hottest on record.  The streets of Miami flood on sunny days.  Ocean acidification threatens Washington State’s oyster industry.  Across the country, people grapple with floods, fires, and severe weather.  Today, California is facing historic drought, with projected job losses of more than 17,000.

2012 was also the second costliest year in history for natural disasters, with a price tag of $110 billion dollars.  And if we see warming of 3 degrees Celsius above pre-industrial levels, instead of 2 degrees, we could face additional economic damages of almost 1 percent of global output.  To put that into perspective—1 percent of 2014 U.S. GDP is almost $150 billion; and we’re just talking about the incremental cost of 3 degrees instead of 2.  You do the math.

As seas rise, so do insurance premiums, medical bills, and food prices.  From water scarcity to wilting crops, companies like General Mills and Coca-Cola see climate change as a “threat to commerce.”   Paying more for soda and cereal means less cash to buy other things.  That chokes economies and stunts job growth.

The bottom line is:  We don’t act despite the economy, we act because of it.

I came to RFF because you understand the power of an economy that values clean air, clean water, and our precious natural resources.  You get that climate action isn’t just about polar bears and melting ice caps.  It’s about protecting local economies and creating jobs.

The good news is, climate action is not just a defensive play, it advances the ball.  We can turn our challenge into an opportunity to modernize our power sector, and build a low-carbon economy that’ll fuel growth for decades to come.  That story of energy progress is being written across America.

EPA’s historic fuel efficiency standards for cars and trucks are cutting pollution, saving families money at the pump, and fueling a resurgent auto industry that’s added more than 250,000 jobs since 2009.  Auto makers didn’t fold, they flourished.  Since President Obama took office, wind energy has tripled and solar has grown ten-fold.  That’s thousands of jobs that can’t be shipped overseas.  Renewable energy on public land by itself accounts for 20,000 jobs.  In less than four years the average cost of solar panels has dropped over 60 percent.  Every four minutes, another American home or business goes solar.  And jobs in the solar industry are growing faster than any other sector in the United States.

A study by the group Environmental Entrepreneurs shows that in the second quarter of 2014 alone, we added 12,500 clean energy jobs.  America’s clean energy progress is bringing down energy costs, bringing in good paying jobs, and bringing back manufacturing.  An ABC poll showed that 7 in 10 Americans want us to act on climate.  So do public health advocates, business groups, faith leaders, and even organized moms and grandmas.

We have over 1 million comments on our Clean Power Plan already, including some great advice from RFF.  We want every good idea possible, so we extended the comment period through December 1st.  People want us to act because the benefits are clear:  from soot and smog reductions alone, every dollar we invest through the Clean Power Plan will return $7 dollars in health benefits.  In 2030, total climate and health benefits could reach up to $93 billion dollars.

The key to making our plan ambitious and achievable is flexibility.  We used section 111(d) of the Clean Air Act to allow states to choose their own low-carbon path forward.  Flexibility means more choice, and more ways to invest.  That sends a powerful market signal that unleashes innovation.

We want to raise the common denominator, so states that can do more learn from states that are doing more.  Our plan is not a one-size-fits-all prescription, it boosts progress already underway in companies, city halls, and state capitals across the nation.

For years, states in the Northeast have teamed up in a market-based program to curb greenhouse gases.  At the same time, they’ve enjoyed some of the nation’s strongest economic growth.  My home state of Massachusetts cut emissions by 40 percent, while its economy grew 7 percent.  Cities and states acting on climate are not slowing down, they’re speeding up.  And according to a new report from the Carbon Disclosure Project, major companies like Delta, Google and Disney use an internal carbon price in their business decisions.  Why?  Because investors and CEO’s see the cost of climate change, and the value of taking action.

We know a global problem needs a global solution.  Although we can’t act for other nations, when the United States of America leads, other nations follow.  We set the bar for solutions.  We set the pace for progress.  Years ago, it was American chemical companies like DuPont and Honeywell that innovated safer chemicals to replace the ones destroying the ozone layer, and sold those solutions to the rest of the world.  And President Obama just convened a group of those companies at the White House last week, to acknowledge their commitment to slash even more pollution, and to announce administrative action that will support and speed up those efforts.

When it comes to the American economy, cutting pollution doesn’t dull our competitive edge, it sharpens it. Thanks to our fuel efficiency standards, the auto industry is once again a source of economic strength.  The number of cars coming off American assembly lines, made by American workers, is the highest it’s been in 12 years.  From catalytic converters to smoke-stack scrubbers, America has a legacy of innovating the world’s leading environmental technologies—accounting for more than 1.5 million jobs and $44 billion in exports in 2008 alone. That’s more than other big sectors like plastics and rubber products.  If you want to talk return on investment, in over four decades, we’ve cut air pollution by 70 percent, while our GDP has tripled.  The health and economic benefits of the 1990 Clean Air Act amendments by themselves outweigh the costs 30 to 1; Phil, I know you championed those amendments while you were in Congress.

Today we have more cars, more jobs, more businesses, and less pollution.  That’s how we define progress, and how we build a low-carbon economy.

So it’s sad to see a small but vocal group of critics hide behind the word “economy” to protect their own special interests; when the truth is, climate action is in everyone’s best interest.  It’s worrisome when we hear those critics say, quote, “…I’m not a scientist, but climate action is going to ruin the economy…”

Well, as President Obama has said, those critics have one thing right: they are not scientists.  They’re not economists, either.  But guess what, we’ve got some pretty good ones at EPA.  And at NOAA.  And at NASA.  We trust them to put astronauts in space, and to tell us if the air is safe for our kids to play outside.  These world-renowned scientists, medical professionals, and economists like you are calling for climate action.

Simply put: the economy isn’t a reason to fear action, it’s a reason to take it.

A report from The New Climate Economy shows that not only is global climate action affordable, but it could actually speed up economic growth.  Another recent study shows that U.S. states that are still skeptical, like Arkansas, Louisiana, Oklahoma and Texas, would actually see an annual net economic benefit of up to about $16 billion dollars. That’s billion with a “b.”

A surefire way to damage our economy is to neglect our need for a healthy environment to live, work, and play in.  That’s what’s at stake.  Back when we took action to heal the ozone layer, special interest critics manufactured doomsday predictions.  They spun stories of supermarket refrigerators shutting off, and manufacturing plants shutting down.  Guess what?  None of it happened.  If those scare tactics sound familiar, it’s because they’re the same ones we hear today on climate change.

Those same critics point fingers at other nations dragging their feet as an excuse for the United States to stand still.  We don’t hide behind the inaction of other nations as an excuse for mediocrity.  We are not about stagnation, we are about innovation.  And we don’t bend to the false warnings of those who lack faith in American ingenuity, and toss aside the values that make America great.  Can you imagine President Kennedy looking up at the moon and saying, “Nah…we’ll just wait for someone else do it.”

When we’ve faced challenges before, we have acted time and time again.  And it’s made our nation stronger.  Because we acted, our kids don’t grow up with acid rain or toxic leaded-gas fumes.  Because we acted, we eat safer foods, drink cleaner water, and breathe cleaner air.

Because we acted, nations came together, compelled by American leadership, to save our ozone layer and protect our people.  Kofi Annan called that effort the “single most successful international agreement” of any kind.   Our climate challenge is not just a responsibility we should accept.  It’s an opportunity we should seize, to retool and resurge with new technologies, new industries, and new jobs.

Let’s remind ourselves what we’re capable of.  Let’s embrace this defining moment of American leadership.  We owe it to our kids to lead on climate change.  Not just to leave them a cleaner, safer planet, but an opportunity-rich economy for generations to come.  Thank you.