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Debate Over Global Warming May Heat Up

From Reuters

A conflict between U.S. lawmakers and the Bush administration over global climate change could boil over in the coming week when the Senate debates legislation that would require U.S. industry to cut emissions of heat-trapping gases.

President Bush has rebuffed pleas from world leaders, including British Prime Minister Tony Blair, to take joint action to reduce emissions of carbon dioxide, which are blamed for rising temperatures.

But three Senate approaches to address the issue could be offered as early as today as amendments to pending energy legislation.

The Senate debate comes two weeks before the Group of Eight industrialized nations meets in Scotland, where Blair hopes to hatch a plan for rich nations to combat global warming.

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The most sweeping option is from Republican Sen. John McCain of Arizona and Democratic Sen. Joe Lieberman of Connecticut, who are applying pressure with a plan that would set a cap on U.S. carbon emissions.

“You’ve got to have an immediate effort to reduce greenhouse gas emissions,” McCain said, adding that any climate-change plan that doesn’t do that is “a fig leaf” and “a joke.”

Their proposal would create a trading program for emitters to buy and sell carbon allowances, modeled on a successful 1990 program to control acid rain.

The McCain-Lieberman plan to cut U.S. carbon output to 2000 levels by 2010 was defeated nearly two years ago in a 55-43 vote, but environmental groups say it is gaining support.

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“Global warming is serious, it’s real and it’s here,” Lieberman told reporters this month.

The two senators contend their plan is long overdue to rein in the United States, the world’s biggest emitter of heat-trapping gases that have been linked to shrinking glaciers, rising seas and warmer temperatures.

A second approach, which would encourage voluntary cuts by industry, was developed by Republican Sen. Chuck Hagel of Nebraska.

His plan would offer tax breaks to companies willing to cut emissions, but it would not cap overall U.S. emissions.

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Democratic Sen. Jeff Bingaman of New Mexico has crafted what is seen as a compromise plan. This option would cut U.S. greenhouse gas intensity -- or emissions per unit of economic growth -- by 2.4% a year starting in 2010.

Bingaman’s proposal would also create a carbon-emission allowance trading program but would limit prices for the allowances that noncomplying utilities could buy at $7 a ton, far below the record of nearly $25 a ton set recently in the European market.

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The Week Ahead

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Today

Conference Board reports its index of leading economic indicators for May.

Wednesday

Quarterly earnings report is expected from Morgan Stanley.

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Thursday

National Assn. of Realtors reports sales of existing homes for May.

Quarterly earnings report is expected from FedEx Corp.

Friday

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Commerce Department reports May’s orders for durable goods and new-home sales.


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