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The House passed the Waxman-Markey cap-and-trade bill last Friday on a largely party-line 219-212 vote. The New York Times editorial board now urges the Senate both to strengthen and pass the House-passed bill. But the Senate is right of the House on climate, so the choice will be to strengthen or pass a bill. Senate passage would require “weakening” the bill from the standpoint of a cap-and-trade advocate. This legislative situation provides me with a great teaching opportunity about the hard choices of practical legislating.

I wrote last Friday about the China/India hole in the American climate strategy:
America appears to lack a high-probability strategy for how to get China, India, and Russia to agree to self-impose a significant positive carbon price.
The Administration and its Congressional allies are trying to impose a significant carbon price in the U.S. through something like [...]

The House Energy & Commerce Comittee reported legislation last Friday that would create a cap-and-trade system for greenhouse gas emissions in the United States.  I’d like to expand a bit on some recent writings by Bjørn Lomborg and Greg Mankiw about this topic.  Dr. Lomborg wrote in last Friday’s Wall Street Journal about a developing [...]

(Editorial note:  I was doing so well moving to shorter posts.  I fail miserably in achieving that goal here.  I went the comprehensive route instead.  I promise to return to shorter posts in the future.  Buckle up – this is a long ride.  I hope you find it’s worth it.)
(Update:  There’s an important correction in [...]

I watched the President’s Tuesday evening press conference twice, and have been studying the transcript as well.  I believe the best way to understand a policymaker is simple:  read, watch, or listen to the words that he or she says.  Getting a policymaker’s views through a news filter distorts and loses content.  In this blog, [...]

Welcome to my new blog.  If you would like to learn more about American economic policy, I would be honored to be your guide.  I will do my best to explain the options faced by senior American economic policymakers, and to analyze the choices they make.
I anticipate defining “economic policy” broadly as we did at [...]

About Keith Hennessey
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About Keith Hennessey

I served as the senior White House economic advisor to President George W. Bush.  My job was to coordinate economic policy for the President, including macroeconomic issues, financial markets and institutions, tax [...]

The Senate is now debating a climate change bill, typically referred to as the “Lieberman-Warner” bill, referring to Sen. Joe Lieberman (I-CT) and Sen. John Warner (R-VA).  Technically, we think they’ll end up considering a slightly different version of that bill, offered by the Chair of the Senate Environment and Public Works Committee, Sen. Barbara [...]

The President delivers his State of the Union address this evening, beginning just after 9 PM.  We typically release “fact sheets” along with the address.
Since the big document is 36 pages long, we also have versions of the different component fact sheets on whitehouse.gov.  Here are the economic ones:

Economy
Budget
Free trade
Energy
Health care

We also have separate fact [...]

In his State of the Union address, the President proposed an energy plan we call “Twenty in Ten”.  The goal is to reduce U.S. gasoline usage by 20% within 10 years (by 2017).  There are two main components to 20 in 10 that would reduce gasoline usage:

fuel economy standards – we would increase the “CAFE” [...]