Enviros warn of trade war after House vote on emissions trading

A "trade war" could result from the House's passage of a bill that bans European countries from imposing emission-trading requirements on U.S. airlines, environmentalists said.

The House on Monday approved legislation to block the European Union from requiring U.S. airlines to participate in its Emissions Trading System starting next year. Under the proposed system, which is similar to cap-and-trade policies that were once pursued in the U.S., airlines from any country would have to trade credits for pollution emitted by flights to European destinations.

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Republicans and Democrats in the House argued that system was unfair to U.S. companies, but the New York-based Environmental Defense Fund said lawmakers had overstepped their bounds.

"The House passing this bill is like another nation saying, 'We don't care if the U.S. has a law enacted by Congress and upheld by the U.S. courts — we're going to prohibit our companies from complying,’" International Counsel Annie Petsonk said in a statement. "It's unlikely that our Congress would let that kind of action go without retaliation.

"This bill could ignite a trade war that would put tens of thousands of U.S. jobs in jeopardy," Petsonk continued. "By barring U.S.-based airlines from complying with applicable law for flights traveling to EU airports, this bill would compel those airlines either to drop their EU routes or become scofflaws. It’s bizarre Congress would knowingly pass a law that compels U.S.-based airlines to become outlaws when they do business in the EU.”


Petsonk defended the Emissions Trading System as being "a modest, non-discriminatory first step to tackling pollution from airlines." The plan calls for airlines to reduce their emissions from 2006 levels by 3 percent by 2013 and 5 percent by 2020.

She contended that airlines have fought the rules every step of the way.

“The airlines have done back-flips to dodge pollution control in the International Civil Aviation Organization, where countries have spent nearly 15 years failing to agree on a program to cut carbon pollution," Petsonk said. "The EU law was duly enacted several years ago, and a preliminary ruling from Europe's highest court a few weeks ago advised that the airlines' challenge had no merit."

Oakland, Calif.-based EarthJustice agreed.

“This bill prohibiting U.S. airlines from complying with a European environmental law sets a very dangerous precedent and could seriously undermine U.S. efforts to keep Americans safe," EarthJustice attorney Sarah Burt said in a statement. "Currently the U.S. requires European airlines to comply with U.S. health and safety regulations as a condition for doing business in the U.S. Now Congress is trying to say that if the Europeans impose conditions on our planes flying into Europe it’s an attack on American sovereignty.

"Congress should do more to protect our citizens and our environment from the harms of climate change, not obstruct the sensible actions of other countries," she said.

The airline and travel industries, which lobbied hard for the bill, offered a vastly different perspective.

“During these precarious economic times, anything done to inhibit travel will be a drag on the global economy and impede recovery,” U.S. Travel Association President Roger Dow said. “We join our U.S. travel industry partners — and numerous foreign countries — in supporting this bill.”

Republicans on the House Transportation and Infrastructure Committee, who strongly backed the bill, agreed with Dow's assessment, calling the emission trading system a "scheme."

“This appropriately named EU scheme is an arbitrary and unjust violation of international law that disadvantages U.S. air carriers, threatens U.S. aviation jobs, and could close down direct travel from many central and western U.S. airports to Europe,” Transportation Committee Chairman John Mica (R-Fla.) said in a statement. “Congress and the United States government will not support this ill-advised and illegal EU tax scheme.”

After months of fighting between members of the two parties over transportation issues like the funding of the Federal Aviation Administration, support for the ban on the emission trading was bipartisan.

The ranking Democrat on the committee, Rep. Nick Rahall (W.Va.), called the EU plan a "go-it-alone approach" that would "fly in the face of the international community."

“Only through international dialogue will we reach consensus on how to deal with a global challenge, but I am confident that, if our European friends will act in good faith, we will more than rise to the occasion," Rahall said in a statement after the vote. "For the meanwhile, this bill will protect U.S. airlines and all Americans who rely on them for travel and employment from the unjust effects of the EU’s plan.”

But despite the bipartisan fervor in the House for the bill to ban EU emission trading, the Democratically controlled Senate has not yet said much about the issue.