U.S. Senate Republican Policy Committee - Larry E. Craig, Chairman - Jade West, Staff Director
June 10, 1998

Nonpartisan GAO Blasts Administration's Kyoto Blueprint
Congressional Audit Reveals Fundamental Omissions in Greenhouse Gas Plan

At a hearing last week before the Senate Energy Committee, the General Accounting Office (GAO), Congress' nonpartisan investigative office, revealed that the White House virtually had no plan behind its proposal to reduce greenhouse gas emissions as it entered into the final negotiations of the international climate change protocol completed last December in Kyoto. Nor has the GAO found any evidence of a solid plan to date -- even as the Administration continues aggressively to move forward in lobbying for support of the Kyoto agreement.

On December 10, 1997, when the Administration announced its support for the Kyoto protocol, President Clinton stated "this agreement is environmentally strong and economically sound." Yet, based on the GAO's findings, it appears the Administration had been operating less on knowledge and more by seat-of-the-pants.

In the course of its investigation requested last November by Senators Craig, Murkowski, Helms, and Hagel (which precipitated the Energy Committee hearing), the GAO indicated it was unable to find:

And for this the Administration has asked $6.3 billion in President Clinton's latest budget. Meanwhile, the Administration has not submitted, and has no intention of submitting, the Kyoto protocol to the Senate this year for ratification, knowing it would fail.

GAO's findings run counter to the Government Performance Results Act (GPRA) -- as well as to simple commonsense management practices. A budgetary outlay of $6.3 billion is at stake here, to say nothing of the impact on the entire U.S. economy.

GAO's Damaging Findings: There's no "There" There

GAO's findings, or rather lack thereof, are profoundly disturbing. The Administration officials working this issue essentially are peddling a pig-in-a-poke -- a plan, apparently, with which even they are unfamiliar. In reviewing the Clinton Kyoto proposal, this is the bottom line: In contrast to what would be expected for a federal program involving 14 agencies and some $6.3 billion in spending that essentially begins immediately, and which commits the entire U.S. economy to extremely burdensome mandatory emissions controls in just 10 years, the GAO told the Energy Committee that no blueprint exists.

CongressDaily reported GAO official Victor Rezendes as saying, "President Clinton's phased plan for putting the nation on a path of greenhouse reduction fails to establish a quantitative goal for reducing emissions." Rezendes also said the administration "has no specific time frame for preparing a more detailed plan that would include overall performance goals and measures." And, he said the GAO has been unable so far to determine how the $6.3 billion increase in climate change spending proposed by the administration this year "will meet the protocol's target for emission reductions." Overall, the GAO remains "uncertain" whether Clinton's plan "will effectively lay the foundation for the 31-percent emissions reduction required by the protocol [by 2010]" [CongressDaily, 6/4/98].

What follows is an excerpt from an unofficial transcript from the hearing, an exchange between Senator Craig and two officials from the GAO. What the series of questions and answers reveals is this: according to GAO, not only is there no "there" there, there never was and there is no evidence that there ever will be. [Questions are addressed to either Mr. Rezendes or Mr. Marwick of the GAO]

Q: So Mr. Rezendes, in your judgment does the administration have an overall implementation plan for stage one?

A: It's a very broad, general plan.

Q: Does it have an overall plan for the costs and the benefits?

A: No, it does not.

Q: For the overall coordination plan for the various federal agencies involved in the plan, is there one?

A: No, sir.

Q: And yet we were told there are 14 different agencies?

A: Yes, that is a concern for us. Whenever you have a group that size coordinating an effort, you would think that there would be a more specific plan, you would hope anyway.

Q: In your judgment, how does the stage-one plan fit with an overall plan for the implementation of the Kyoto protocol? Because we hear that there's a hand and glove relationship here. We're not going to get the protocol, we've shifted to a domestic policy that tends to fit it, the question is: does it?

A: Well, that's really the point. There are no measurable goals to be achieved at the end of stage one, so it's hard to figure how that would flow into the second stage, and third-stage requirements.

Q: So you're suggesting that the proposed 31-percent reduction of greenhouse gases by 2010 as a stated goal of the proposed protocol and stage one don't necessarily fit because there are no indices or measurement as to how they might come together?

A: That's correct. Basically what I am saying is that we have three different stages and at each stage we would expect a milestone, a target to be achieved so Congress would know whether they got the results of the $6.3 billion that they spent for the first five years. As you know, the biggest part of that $3.6 billion is just a tax credit and there are no stated benefits to be achieved yet, they're still working on that.

Q: In your judgment, does the administration have a longer-term implementation plan for those years after stage one?

A: No, we haven't seen it.

Q: For the cost and benefits to be derived from it?

A: Again, no.

Q: For the overall coordination plan, for the various federal agencies involved in this plan?

A: Again, no.

Q: Is this what you had expected for a federal undertaking of this size and importance?

A: We would hope for significantly more. Especially since how serious the administration claims this problem is. We would expect a more rigorous coordination and detailed implementation plan.

Q: So, you are saying by the statements this morning, this is the most significant environmental undertaking of this country or this administration, and there appears not to be lines connecting the dots?

A: Only in a very general way. That's correct. We're not seeing specific performance goals, specific measures, specific time frames by stage as to how this is going to achieve the result in the end.

Q: How does this compare with the sound management principles and with the spirit of government management reform or the Government Performance and Results Act?

A: It doesn't. In fact, as you know, GPRA is not anything really extraordinary, it is really common sense: as you have a federal program and you are spending money, you have specific goals, objectives, and those are cascaded throughout the organization with clear performance measures and targets to know how you are progressing between them. It is not revolutionary, but it's common sense and a good framework. We think that this does not meet the spirit of GPRA.

Q: I guess I could suggest from those comments -- though I do not want to put words in your mouth -- but I'll say that there appears to be no common sense in the way that it has been put together. Could you give us a professional analysis of [Dr. Janet Yellin (Chairwoman of the President's Council of Economic Advisers)'s] recently revealed cost estimate for overall implementation?

A: We haven't seen enough of the assumptions that underlie her estimate to enable us to determine whether they're reasonable. . . .

Q: ...Have you found that specific plans existed as a preparation for the Kyoto meeting when the administration had stated that the goal was to reduce greenhouse gas emissions to the 1990 level?

A: No. We're not aware of any. They might have been, but in discussions with these officials we've not been made aware of them.

Q: Were such plans under development?

A: I'm not aware of that either. I don't believe so.

Q: Were any plans or estimates produced on which to base the administration's negotiating positions at Kyoto?

A: There are various studies, as you know, done by national laboratories that were part of the input into the decision-making that the administration used.

Q: But there were not a set of specific plans?

A: Correct.

Background: The Importance of Evaluating the Administration Blueprint

The purpose of the Energy Committee hearing was to examine the Administration's blueprint -- its implementation, its economic analysis, inter-agency coordination, for example -- underlying the Kyoto accord.

The need for the hearing was precipitated by a request last fall by Senators Craig, Murkowski, Hagel, and Helms for GAO to examine four basic questions about the Administration's proposal to reduce GHG emissions to the 1990 level:

  1. What are the specific elements affected by the proposal and how much GHG reduction is anticipated from each element?

  2. Are the GHG reduction goals consistent with historical experience on similar types of initiatives?

  3. Has the Administration analyzed the economic impact of the accord and the likely impact on the economy?

  4. How does the Administration's analysis compare with outside analyses?

Since the Senators submitted their inquiry to the GAO, the Administration has moved forward on its efforts to move the protocol forward:

  1. It helped negotiate and signed onto the Kyoto protocol that would require developed nations to meet mandatory reductions of GHG emissions and require the United States to reduce GHG emissions 7 percent below 1990's level -- an amount fully 7 percent below the Administration's previously stated objective;

  2. it has proposed $6.3 billion in its latest budget to implement the Kyoto accord;

  3. it has held and is continuing to hold outreach programs to encourage support for the Kyoto accord;

  4. it has sent a team to Bonn, Germany to work with other nations to address compliance issues; and

  5. it is planning to send a team to Buenos Aires in November to work with other nations to clarify two terms in the protocol.

However, the Administration has not yet either submitted a protocol to the Senate or announced a timetable for doing so -- despite an unanimous Senate resolution offered by Senators Byrd and Hagel requiring that this be done.

It is to be assumed that since the Administration has requested billions in funding for Kyoto-related programs, since it is encouraging support for Kyoto, since it is working with other nations on compliance and enforcement of Kyoto, and since it is obviously a long way toward implementation, that it must have developed a pre-Kyoto analysis, as well as a post-Kyoto analysis. Congress needs to know the Administration's overall blueprint for Kyoto.

The White House's Kyoto Proposal: A Disturbing Lack of Planning

Congress and the country should be comfortable assuming that no White House would enter into international negotiations or agree to worldwide accords that had not been thoroughly studied, particularly the economic effects, or that an accord would be signed for which there had been no thorough evaluation of its implementation. However, the GAO analysis reveals that in this case, such assumptions would be flat wrong.

The Administration's environmental do-gooders are peddling Congress (via a $6.3 billion FY99 request) and America (via the economic consequences of the overall Kyoto accord) a pig-in-a-poke -- so cleverly disguised, in fact, that even they do not fully understand it. In pursuing their Kyoto proposal, the White House is following a process that violates its own "reinventing government" initiative and Congress' Governmental Performance Results Act rules -- a process that wouldn't hold up for the construction of a single federal office building. Yet, this is the construction of a multi-billion-dollar budgetary proposal, one that lacks a blueprint. This is the very height of irresponsibility.

On March 4, 1998, Janet Yellen, chairwoman of the President's Council of Economic Advisers, stated that it was "not yet possible to provide a full authoritative analysis" of the Kyoto accord, but still was able to state that the cost impact would be "modest." Again, GAO could not find evidence to support the Administration's assertion.

Congress' first complaint with the Clinton Kyoto proposal is not about flawed science, it is not even about flawed economics -- though it surely is both -- it is about a flawed process, from which a good outcome cannot result regardless of the good intentions behind it.

By failing to prepare for its first step, how can the White House expect to reach the goals to which it will bind this nation? Knowing this, how can Congress in good conscience commit the country to follow?

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