- 5/21/2025
During remarks on the Senate floor Wednesday, Sen. Sheldon Whitehouse (D-RI) spoke about Republicans' effort to use the Congressional Review Act to stop a California regulation on electric vehicle sales.
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00:00:00Senator from Rhode Island. Thank you very much, Mr. President. Let me describe what
00:00:09I think is going on here on the Senate floor. Today is an unusual and
00:00:17interesting day. What we understood the plan was, was that the majority was going
00:00:29to move to the Congressional Review Act regarding the California Clean Air Rule
00:00:40in an effort to overrule the Clean Air Act rule for the fossil fuel industry
00:00:49which the majority so diligently serves. The problem with that is that the
00:01:02parliamentarian has ruled that the Congressional Review Act does not apply
00:01:12to the waiver that California gets allowing it to do its own clean air
00:01:22standard. So they had a problem. The problem was that Democrats were going to
00:01:33make a point of order saying, hey you can't do that. We've argued this matter.
00:01:36We both went before the parliamentarian. We made our case. We filed our pleadings.
00:01:42We got a decision. In our view it was not even a close call of a decision but that's
00:01:47in our view. And what you're really doing here is for the fossil fuel industry
00:01:53going nuclear, overruling the Senate parliamentarian to accomplish a
00:02:01legislative task to amend basically the Congressional Review Act. And then open
00:02:10the door for that to undo a 30-year tradition of California and other states
00:02:16like Rhode Island being able to operate under better clean air standards and
00:02:22vehicle emission standards than the federal government may be willing to
00:02:28accomplish. So that's where we thought we were. Now what is happening is that we've
00:02:36gone to a different CRA. This one having to do with hydrogen vehicles. And the
00:02:45minority has five hours. There's a total of 10 hours evenly divided. I suspect
00:02:49that the majority is not going to use much that time. But the minority has five
00:02:54hours to talk about what is going on. And so we are now in the five-hour debate
00:02:58period on the hydrogen vehicle CRA as the majority moves towards making its
00:03:10play on the California clean air standard. So this is a slight bump in the
00:03:21road for them. But our understanding is that there is a new plan. And the new
00:03:31plan is at the conclusion of our five hours to make a point of order that
00:03:41allows them to do the California CRA effort and create a new way to get
00:03:56around the terms of the Congressional Review Act. So the predicament for them
00:04:04is that the Congressional Review Act as a law passed by the Senate, passed by the
00:04:09House, signed into law by the President, says in the Senate, which is where we are,
00:04:16when a committee is discharged from further consideration of a joint
00:04:19resolution, which is where we are, all points of order against the joint
00:04:26resolution are waived. And they intend to create a Senate exception to that. We
00:04:36expect that the parliamentarian will say, when they offer this point of order,
00:04:41the parliamentarian will say based on the statute, based on the law, well that's
00:04:47not in order. And then they'll go nuclear on this. And they'll bring everybody back
00:04:56to, by a simple majority vote of 51, overrule the parliamentarian as to that
00:05:03new point of order. So the purpose is to create a point of order that allows a
00:05:11bypass of the parliamentarian's decision, a very sound one and clear one in my
00:05:17view, based on precedent, law, history, tradition, all of it, that the CRA effort
00:05:32to undermine California's clean air standard does not work under Senate
00:05:40rules. So in a sense this is like a double nuclear option. They're going to
00:05:47overrule the parliamentarian to create a new point of order under the CRA that
00:05:55will amend in effect the CRA, will make the law regarding this no longer
00:06:03effective because they will come in and overrule the parliamentarian. And then
00:06:11even though the parliamentarian's ruling is you can't use the CRA to go after the
00:06:16California waiver, they don't have to overrule that directly because they will
00:06:22by overruling the parliamentarian created this little end around. So I
00:06:31guess this is a demonstration of how many hoops the Senate majority is
00:06:40willing to jump through for their fossil fuel supporters. And it ends at the same
00:06:51point, which is the purpose of the exercise. It ends with the parliamentarian
00:06:55being overruled and it ends with an attack on California and other sovereign
00:07:04states' ability to require cleaner air and lower vehicle emissions in their
00:07:13states. Now why does that matter? Well obviously if you're the fossil fuel
00:07:19industry, one of the things you sell is gasoline. And one of the things that the
00:07:25California clean air and emission standards do is to require the auto
00:07:32industry to make automobiles more efficient. Maybe even make them hybrid.
00:07:38Maybe even make them electric. And whether they're more efficient or hybrid
00:07:43or electric, it all ends in the same place for the fossil fuel industry, which
00:07:47is we can't sell as much polluting gasoline. And we want to sell more
00:07:55gasoline. And we don't like clean air standards that get in the way of us
00:08:00selling as much gasoline as we want to. So we are here through this complex
00:08:12parliamentary rigmarole to overrule the parliamentarian to get around her
00:08:21ruling that the Congressional Review Act only covers rulemakings, not the
00:08:31California waiver and other things. One of the problems with that is that, you
00:08:39know, if you give a mouse a cookie, it doesn't stop here. It opens the
00:08:45Congressional Review Act, which was very specifically designed to address
00:08:50rulemakings within a period of time after the conclusion of the rulemaking.
00:08:57And this would allow essentially anything you could put into the federal
00:09:01register to be submitted to Congress for Congressional Review Act review no
00:09:10matter when it was done. All you have to do is re-up it with a submission and
00:09:14send it into Congress, the California waiver being an example of that in the
00:09:20sense that it's been around for about 30 years now. So one of the Congressional
00:09:28Review Act limitations was it had a brief time window in which you were
00:09:33allowed to come to Congress to disapprove a rule. And that time period is
00:09:42now blown to smithereens if they go through with this parliamentary scheme.
00:09:48The second thing is it had to be a rulemaking. That it added a process at
00:09:54the end of the Administrative Procedures Act rulemaking when the rule was finally
00:09:57enacted into law as a agency rule. You always had the ability to court and sue
00:10:06and say that the Administrative Procedures Act was violated, was
00:10:09arbitrary and capricious, was in violation of law, whatever. This gave it a
00:10:13political extra opportunity, which was to jump straight to Congress and just ask us
00:10:19to disapprove it. You don't have to prove then that it's anything wrong with the
00:10:24rule, just politically we don't like it so we're going to jam it. And so when you
00:10:31expand beyond just APA rulemaking to essentially any executive decision
00:10:39that can be dumped into the Federal Register to create a submission that can
00:10:42then be brought here, you have opened a massive, massive array of executive
00:10:51actions to Congressional Review Act disapproval. As my colleagues have said,
00:10:57it could be as simple as a lease, as simple as a permit, as simple as a
00:11:02license. Essentially any executive decision since the passage of the
00:11:07Congressional Review Act can now be brought here on a purely political basis,
00:11:11boom, blown up. If my colleagues on the other side don't think that we will use
00:11:18this if they do this, they have taken leave of their senses. Of course we will.
00:11:25They are about to create a new Senate in which the CRA can be used for an immense
00:11:33array of purposes well beyond what the actual law says. They don't have to be
00:11:42doing this, let's be clear. They do not have to be doing this. There are other
00:11:46ways to serve their fossil fuel industry friends in the industry's desire to
00:11:55attack the vehicle emission standards, the clean air standards. There are a
00:12:01whole bunch of them. One, they could do it administratively. In fact, in 2019 the
00:12:08Trump administration withdrew a previously granted Clean Air Act waiver
00:12:14and to do that it made findings per a Clean Air Act process, administrative
00:12:26findings per a Clean Air Act process as to the three criteria established under
00:12:33the Clean Air Act that determine whether a waiver application gets
00:12:40granted or denied. So they already tried that once, they know that that's an
00:12:46avenue. Why did they not want to do that? Well, for starters, it's amenable to
00:12:51challenge if it's done unlawfully, if it is done arbitrarily and capriciously, the
00:12:58magic words of administrative mischief and you end up in a forum like a court
00:13:07where you have to defend your facts. Unlike here where all you have to do is
00:13:11have a majority and ram it through. So they didn't want to do it
00:13:16administratively but they could have and they already tried in the last Trump
00:13:20administration. What else could they have done? Well, this is California's Clean Air
00:13:26Act standard. They could have gone and negotiated with the sovereign state of
00:13:31California and the other sovereign states that have attached themselves to
00:13:36the cleaner standard of California, which includes Rhode Island. This could be done
00:13:44through a regular process of negotiation. We just had the administrator of the EPA
00:13:52in the committee this morning for a lively exchange and he repeatedly talked
00:14:00about how interested EPA was in cooperative federalism, that the federal
00:14:05government has to be a real partner with sovereign states, that we shouldn't be
00:14:09lording it over the sovereign states. They have expertise and interests of
00:14:13their own and cooperative federalism means that the federal government and
00:14:17the state governments should work as partners to accomplish goals. Well that
00:14:22was pretty rich while EPA is trying to roll a sovereign state that is the
00:14:27fourth biggest economy on the planet without any hint of negotiation or
00:14:33cooperative federalism or effort because when you're negotiating the other side
00:14:39gets a vote too and you have to come to an agreement and it's much easier to
00:14:44come here and have your friends in the Senate do your bidding in the Senate
00:14:52without any standard other than do we have the votes. But they could have done
00:14:59it that way. There's a totally clear path to negotiate with California. Say, hey
00:15:03circumstances have changed in this way or that. We have new policy issues that
00:15:07we want to argue to you and let's try to figure out if we can work this out. Nope.
00:15:13Didn't even try. The other way to do this would be to go back and actually
00:15:19change the Congressional Review Act. Right? It's a statute so we can amend it
00:15:23and we could go through the process of amendment and say okay we don't want the
00:15:30Congressional Review Act to be limited to rulemakings any longer. We want to
00:15:35open it up to more stuff and we could have a conversation about what should
00:15:40and should not be included in an expanded gateway to the Congressional
00:15:44Review Act. The House would have it say you'd end up doing what we call around
00:15:49here regular order and in the Senate the minority because you'd have to get
00:15:54through cloture. The minority would have a chance to make our points and you
00:15:59could do an amendment using regular order. Again, they'd have to listen to us
00:16:04and that have to pay attention to facts. Now all they have to pay attention to is
00:16:09interests and the fossil fuel interest is their dominant interest and votes. Do
00:16:16they have the votes? And those make it easy to choose this way to go nuclear in
00:16:23the Senate rather than do the work either of amending the Congressional
00:16:29Review Act by law or negotiating with a sovereign state in ordinary federal
00:16:37state cooperative federalism or pursue that Clean Air Act administrative
00:16:44process that they had begun back in Trump one. Again, the reason not to do all
00:16:51those three is you can't just roll everybody and do what the fossil fuel
00:16:56industry wants. So here we are. This is because this is the shortcut. This is the
00:17:02thing that does what the fossil fuel industry wants and the price is going to
00:17:07be very very high because in my recollection there has never been a
00:17:12legislative outcome in this body determined by overruling the
00:17:16parliamentarian. We've gone back and forth on nominations but on a
00:17:22legislative outcome which changes the Congressional Review Act and which
00:17:26allows an attack on a statutory waiver in the Clean Air Act for the state of
00:17:34California. Those are legislative in their effect and so to me that is not
00:17:42the right way that we should be going about this. So there are a bunch of
00:17:53problems with what is going on here but to understand the floor machinations
00:18:03we're about to go through, the overruling of the parliamentarian to create an end
00:18:07around so we don't have to overrule but can only violate the order of the
00:18:11parliamentarian on the CRA, you really got to understand the baseline story
00:18:17here. The baseline story here is that this is the fossil fuel industry in
00:18:20action. It may look like it's a majority and a minority in the Senate having an
00:18:26argument. No, it's the fossil fuel industry in action trying to create a
00:18:30shortcut for itself so it can sell more gasoline and pollute more and ignore all
00:18:35the states that have joined with California to demand cleaner air for
00:18:40their constituents. The fossil fuel industry essentially runs the Republican
00:18:46Party right now. The fossil fuel industry hates this clean air standard
00:18:51because it sells less gasoline in the states where the clean air standard is
00:18:56there and it sells less gasoline in other states because it's hard to market
00:18:59both a clean vehicle and a dirty vehicle side-by-side so to get to the enormous
00:19:06number of states that are with California on this and to sell into
00:19:10their markets they've got to make more efficient vehicles everywhere. So
00:19:13everybody enjoys the benefit of spending less on gasoline, getting better
00:19:18vehicle mileage, and having cleaner air. So it actually works out pretty well for
00:19:21everybody except the fossil fuel industry which of course wants to
00:19:27sell more gasoline, period, and end of story. And what they have is a willing
00:19:34Senate majority that will basically do whatever it is that they want. And they
00:19:40have an executive branch that has been infiltrated by fossil fuel interests
00:19:47and is now essentially run by fossil fuel interests. In my previous Time to
00:19:53Wake Up speeches I've described, I'm probably not going to get this perfectly
00:19:58right because I'm going from memory here, but there is a kind of wasp that
00:20:05injects its larvae into another bug. And as the larval wasp begins to grow, it
00:20:19takes over the neural system. It takes over the command and control system of
00:20:26the other bug. So the other bug is still alive. It still looks like the other bug
00:20:36shape and size and all of that. It doesn't look any different than a
00:20:41regular other bug, but it's being driven from inside by the larval wasp which
00:20:49tells it to go do things that then create a place where the larval wasp can
00:20:56grow, can nest, can feed, whatever it needs to do. It takes over the bug from
00:21:01the inside and takes over command and control and steers it around. That to me
00:21:07is a pretty good analogy for what the fossil fuel industry is doing with
00:21:10the United States government right now. All of their front groups, all the
00:21:15machinery that they've created over years to propagate the fraud of climate
00:21:19denial and to exert wild political influence throughout the country, all of
00:21:25that now just slots right into positions in government that are taken over by
00:21:31people who say that the concern about climate change is crud. Climate
00:21:37change is a religion and not science. They speak utter nonsense. It's like the
00:21:44worship of Baal back in biblical times, bowing down to fossil fuel and doing
00:21:51whatever it is that the great god Baal wants. Well, things didn't work out too
00:21:56well for the priests of Baal, if you follow that analogy, but that's where we
00:22:00are and what all of this overlooks is the coming storm. When the president
00:22:09pretends that climate change is a hoax, he disables government's ability to
00:22:13prepare for a coming storm. When the executive branch censors the use of the
00:22:21terms climate change, demands that they be struck from government documents, that
00:22:28prevents the executive branch from preparing for the coming storm. When the
00:22:35executive branch, as we heard just today in the Environment and Public Works
00:22:39Committee, goes around and terminates grants based on a heresy hunt, where
00:22:48they're looking through the grants for language they don't like, like equity.
00:22:53There's a bad word. Inclusion. Can't have that. Climate. Definitely worth
00:23:02terminating a grant over that. They are destroying the programs that would help
00:23:11communities prepare for the coming storm because they have the word climate in
00:23:16them. They even went so far in the executive branch as to have an executive
00:23:23order on energy that refused to include either solar energy or wind energy in
00:23:31the definition of energy. Like you can say what you want about whether you like
00:23:36solar or whether you like wind, but all you have to do is go to a solar facility
00:23:42or go to a wind facility and you can see the electrons coming off of it. The idea
00:23:47that that is not energy, that's not just a violation of law and common sense.
00:23:54That violates the dictionary. But that's how far the fossil fuel industry wasp
00:24:01will drive the Trump administration bug to ignore the coming storm. What does the
00:24:11coming storm look like? Well let me start. I ask unanimous consent to use a larger
00:24:17than usual graphic in order to show an old page from the New York Times. This is
00:24:23always good to remember because it wasn't always this way with President
00:24:26Trump. Here in 2009 there was a full-page ad in the New York Times. President Obama
00:24:34was getting ready to go to send a crew to Copenhagen for the COP, the climate
00:24:39change conference, and business leaders spoke up about that saying as business
00:24:46leaders here's what we have to say. One, if we fail to act now it is
00:24:54scientifically irrefutable that there will be catastrophic and irreversible
00:24:58consequences for humanity and our planet. Well that's kind of the point here and
00:25:06I'll get in a moment to what some of those catastrophic and irreversible
00:25:09consequences look like. And it goes on to demand that the Obama administration
00:25:15show leadership on climate change. Please allow us, the United States of America, to
00:25:21serve in modeling the change necessary to protect humanity and our planet. Signed
00:25:28by Donald J. Trump, Chairman and President, Donald J. Trump Jr., EVP, Eric F.
00:25:37Trump, EVP, Ivanka M. Trump, EVP, and the Trump Organization. So there have been
00:25:48times when the Trump family understood what climate change was all about,
00:25:52understood the catastrophic and irreversible consequences that were
00:25:57looming, and were willing to say so. But in between came exposure to politics,
00:26:03exposure to the power of fossil fuel on the Republican side, and the
00:26:08understanding that if you really want to make it in Republican politics you've
00:26:11got to do whatever the fossil fuel industry wants, whenever the fossil fuel
00:26:16industry wants it. And that means we're ignoring some pretty serious warnings.
00:26:21One of the earliest warnings came from Freddie Mac. Freddie Mac is not a green
00:26:28organization. Freddie Mac is a huge mortgage company, a federally chartered
00:26:35giant mortgage company. And as a giant mortgage company, it has a very distinct
00:26:44interest in the mortgage market. And what did the chief economist for Freddie Mac
00:26:51warn? He warned that climate change was making coastal properties uninsurable.
00:27:03Climate change was making coastal properties uninsurable either because sea
00:27:08levels were rising and they would flood, or because storms were worse and they'd
00:27:14be more damaged by hurricanes and massive rains, or because, who knows, they'd lose
00:27:20access to the freshwater in their wells because of the infiltration of salt
00:27:25water underground. There are all sorts of ways in which climate risk hits coastal
00:27:33properties. And so the chief economist said here's how that works. The climate
00:27:39risk disrupts the insurance industry as to certain properties, meaning those
00:27:46properties also can't get a mortgage any longer. Freddie Mac is a mortgage giant.
00:27:53It knows what's needed for a mortgage. What's needed for a mortgage is an
00:27:56insurance policy. No insurance policy, no mortgage. So now you've got properties
00:28:02along the coast that are at risk that can't get insurance and can't get a
00:28:06mortgage. What happens to the value of those properties? Well, it goes down, he
00:28:11predicted. He predicted a coastal property values crash as a result of
00:28:18that cascade from climate risk to uninsurability to no mortgages. And the
00:28:25coastal property values crash, he predicted, was going to be so severe that
00:28:30it would look like 2008, that mortgage meltdown, all over again. And he stands by
00:28:37that testimony. In fact, he came when I was chairman of the Budget Committee to
00:28:42reiterate it. Something else has changed in the meantime, though. It's not just
00:28:49coastal property risk. Ask any of our Western colleagues about wildfire risk
00:28:56and about what is going on in areas that have wildfire risk that the insurance
00:29:03company can't figure out, can't predict, and therefore backs away from. We are
00:29:11seeing that all across the country. The coastal property values crash warning
00:29:17now has an evil sibling. The wildfire adjacent property values crash warning.
00:29:25And either one of them, or both, could create that cascade from uninsurability
00:29:32to un-mortgageability to crash in property values to nationwide recession.
00:29:40He's not alone. A little over a month ago, the chairman of the Federal Reserve,
00:29:46Chairman Powell, came and testified in the Banking Committee. What did Chairman
00:29:52Powell have to say? He said that in 10 to 15 years, it will be impossible to get
00:29:58insurance or a mortgage in entire regions of the United States. Exactly
00:30:07that cascade. Climate risk, uninsurability, can't get a mortgage, property values
00:30:13crash. Here's the chairman of the Federal Reserve, also not green, just a guy who's
00:30:19interested in dealing with risks to the financial system. And he's saying, here it
00:30:25comes. Buckle up. We're gonna see that in 10 to 15 years. Well, if we're gonna see
00:30:31that in 10 to 15 years, who's looking at that now? Investors are. Insurance
00:30:36companies are. You can't wait 10 to 15 years for the effects of entire regions
00:30:43of the country that can't get mortgages to start to be felt. That's gonna start
00:30:48to happen now. And in fact, it is. Look at the high-risk areas in the country.
00:30:54Here we see things like, from our Budget Committee work, these are non-renewal
00:31:00rates around the country. And you can see in high-risk areas, Florida for coastal,
00:31:05California for both coastal and wildfire, that non-renewals are spiking up in
00:31:11areas of climate risk. What's a non-renewal? The non-renewal is when your
00:31:16insurance company says to you, you know, thanks for all the premium you paid all
00:31:19these years, but your piece of property has now become uninsurable. We can't
00:31:23manage that risk any longer. Therefore, you're fired. Go find another insurance
00:31:28company. Well, that's a big mess. Then we go on to First Street, which took some of
00:31:35this data and others, and started predicting forward. This is where home
00:31:40values are headed because of climate change. And you can see in these darker
00:31:44red areas, you're looking at actual reductions in home value, right? Not your
00:31:54home is your castle and it's always going to be valuable, but actually the
00:31:59value of it goes down. And some of the marks go as much as 100% loss of value.
00:32:0580% is this color. 60% is this color. And you can see it's speckled throughout the
00:32:11country. Places where in the time of a 30-year mortgage, in the time of a
00:32:1730-year mortgage, you are going to see property values actually go down. The
00:32:22property values crash that was predicted by Freddie Mac and the loss of mortgage
00:32:33availability that was predicted by Chairman Powell. Here's another one. Where
00:32:39do insurance premiums go in the next 30 years? Well, a lot of places like down in
00:32:43Florida, we've already seen them double, triple, and quadruple. Average insurance,
00:32:48home insurance payment in Miami-Dade County is $17,000 a year. You look down
00:32:53here at Miami and it's in the dark zone where it's supposed to go up 300%. That's
00:32:58a quadrupling, just so you know. So if you're at $17,000 now and you're going to
00:33:04quadruple in 30 years, that means you're going to end up, do the math. I'm not doing
00:33:10it right now in my head, but let's say it's $70,000 a year, right?
00:33:15Quadrupling $17,000. $68,000 a year. If you have a property that has a carrying
00:33:26cost for the buyer of $68,000 a year, how valuable is that property? What is the
00:33:35present value of that liability that comes with the property? It's a huge
00:33:41liability and it knocks down the value of the property. So that's why the home
00:33:49value evidence that First Street collected here relates to the insurance
00:33:56premium expense. You don't just lose the value of your house when your property
00:34:03isn't mortgageable any longer and you can't find anybody to buy it other than
00:34:09a cash buyer. You also lose the value of your house when the carrying cost of
00:34:15your home insurance becomes so great that nobody wants to buy into that
00:34:22annual $68,000 liability. How much would you pay to have to write a $68,000
00:34:29check every year? Not much. You have to be pretty darn nice house to cover that.
00:34:33And for a lot of people, that just erases the value of the home, which is why we
00:34:40get there. So First Street, their estimate was that climate change could
00:34:47have raised 1.4 trillion dollars in US residential real estate value by 2055
00:34:54due to these concerns that they put on the chart. And they're not alone. It's not
00:35:02just Freddie Mac, it's not just First Street Foundation, it's not just Fed Chair
00:35:05Powell. Here's the Mortgage Bankers Association, right? You think that's a
00:35:09green group? Huh, fat chance. But they do care about mortgages and what they say in
00:35:15their report is, and I'm quoting here, chronic physical risk associated with
00:35:20climate change, i.e. the insurance risk, may exceed the capacity of insurance and
00:35:27government assistance to sustain some areas. That kind of tracks with Jay Powell
00:35:36saying there are gonna be whole regions of the country where you can't get a
00:35:39mortgage any longer. Even with government help, even with insurance, you
00:35:43just, it doesn't work any longer. So when an advocacy group like that for the
00:35:50Mortgage Bankers is giving this warning, it might be worth paying attention to. It
00:35:55might be worth not just dismissing it. Oh, climate change is a hoax. None of us
00:35:58need to worry about that. The Economist magazine, also about as un-green as it
00:36:06can be, and the Economist magazine, this is the cover story. If you can't read it,
00:36:12it says, the next housing disaster. And it's a house on a piece of land that's
00:36:17being eroded by seas. Here's what it warned, and I'm quoting, if the size of
00:36:24the risk suddenly sinks in and borrowers and lenders alike realize the collateral
00:36:35underpinning so many transactions, like those mortgages, is not worth as much as
00:36:43they thought, because those prices have fallen as insurance rates climbed, a wave
00:36:58of repricing will reverberate through financial markets. Climate change, in
00:37:07short, here's the punchline, climate change, in short, could prompt the next
00:37:13global property crash. Another way they say it in the article is this, at present
00:37:21the risks of climate change are not properly reflected in house prices. A
00:37:29study in Nature, a journal, finds that if the expected losses from increased
00:37:36flooding alone, that's that coastal value crash risk, not the wildfire one, just
00:37:44flooding, expected losses from increased flooding alone were taken into account
00:37:50the value of American homes would fall by from 121 billion to 237 billion
00:38:02dollars. Again, aligning with what First Street predicted, changes in Americans
00:38:12home values because of climate risk, uninsurability, and un-mortgage ability.
00:38:19121 billion to 237 billion is a pretty big hit on those homeowners whose
00:38:29properties have lost that value. And globally what they say is that we're
00:38:34looking at a 25 trillion dollar hit to global real estate markets, the largest
00:38:41asset class on the planet, they say, is real estate and it's looking at a 25
00:38:44trillion dollar hit. Yeah, let's ignore that and believe fossil fuel funded
00:38:50White House that says it's a hoax. That makes a lot of sense. Obviously if
00:39:00there's going to be a property values crash and if mortgages are going to be
00:39:05in the center of it, that's not great for the banking industry. Why? First of all,
00:39:11the banking industry makes a lot of money off of mortgages. And if a whole
00:39:14bunch of property won't sustain a mortgage any longer, that shrinks the
00:39:18market. So there's less revenue to be had for the banking industry. But also, if
00:39:24you've got a mortgage on your books as a bank, the liability, what the owner owes
00:39:33you on the mortgage, gets offset in your solvency determinations by the value of
00:39:39the collateral that you hold against that liability. The collateral is the
00:39:44value of the home. What happens to a bank in a region where the value of the home
00:39:52has fallen in half? What happens when the homeowner owes more money than the
00:40:03property is now worth? That hits the bank's loan-to-value ratio. That is a
00:40:11determinant of bank solvency. And so guess what? This is not just me saying
00:40:16this. The International Financial Stability Board just did this report in
00:40:27January, giving a warning to the global banking system. Look out. Buckle up.
00:40:35Climate risk is coming. Uninsurability is coming. Unmortgageability is coming. And
00:40:43you need to plan to stay solvent through and survive that crisis. So I will tell
00:40:53you, this is a very technical report, done by very technical people. The
00:40:59Financial Stability Board is, again, not a green organization. But they do have an
00:41:04obligation to look forward and predict risk, and they are predicting this risk
00:41:08to the global banking system. So, Commodities Futures Trading Commission,
00:41:18during Trump 1, by the way, issued this report, Managing Climate Risk in the U.S.
00:41:26Financial System, saying that climate change poses systemic risks to the U.S.
00:41:32economy across multiple sectors, simultaneously, and within a short
00:41:37timeframe. This is coming at us. Undermining the U.S. financial system's
00:41:43ability to sustain the economy. Let me read the opening sentence from the
00:41:47report, from the executive summary. Climate change poses a major risk to the
00:41:53stability of the U.S. financial system, and to its ability to sustain the
00:41:58American economy. Precisely as the other experts argued. Risk to insurance, to
00:42:06mortgage, to property values crash, to economic collapse. On the next page, they
00:42:15say, among findings of the report, a central finding of this report is that
00:42:22climate change could pose systemic risks to the U.S. financial system. Let me say
00:42:29a word on systemic risks. It sounds like a pretty dull term. It's not like
00:42:33apocryphal risk, apocalyptic risk, catastrophic risk. It just says systemic
00:42:39risk. What does that mean? That means that the whole system takes a hit. That means
00:42:44that the damage is not contained to the sector where the damage is happening.
00:42:52That's like 2008 all over again. We had that set of bad mortgages, but when that
00:43:00set of bad mortgages became apparent, that that was fake and phony, and that
00:43:05there was not real value there, it didn't just harm the mortgage holders. It took
00:43:12down entire investment firms, and that crash cascaded out through the entire
00:43:21economy. Those of us who were here in 2008, I can remember the agony, the
00:43:26financial agony of Rhode Islanders when that recession hit so hard and so
00:43:32suddenly. I can remember the people who were at the Treasury and at the Fed who
00:43:38were supposed to prop up our economy in a state of absolute sweating panic about
00:43:44how this crash was going to wipe out the U.S. financial system. That's what
00:43:50systemic risk is. It means the whole thing goes down, the whole system. So it
00:43:58sounds like a pretty mild term, but if you're familiar with economics, you know
00:44:05that that is one of the scariest words in the economic lexicon. What else have
00:44:14we here? We've got Deloitte, not very green either, big consulting powerhouse.
00:44:18Here's what they say about continuing to fiddle around on climate change and
00:44:23pretend it's a hoax and censor the term and act like idiots about a true coming
00:44:29risk with abundant warnings about the risk. They say that we've got a range of
00:44:40outcomes. By 2070, that was their target period, they said if we can start
00:44:48getting climate right, if we can start addressing this problem before these
00:44:55systemic harms happen, then what's going to happen is that global GDP will
00:45:03increase by around 40 trillion dollars, i.e. the world will be better off
00:45:11financially by 40 trillion dollars for us making the right decisions to get
00:45:16climate change right. That's one outcome. The other option is that we continue
00:45:24goofing off. We continue fiddling around and lying about climate change or
00:45:29believing the lies about climate change. We continue ignoring the evidence. We
00:45:34continue ignoring what we're seeing with our own eyes in the insurance industry
00:45:39in regions of the United States right now already. Go around Florida and talk
00:45:45about property insurance and tell me what you hear, because I'm pretty sure I
00:45:48know because I've been there and heard it. The other is a hundred and eighty
00:45:59trillion dollar hit to global GDP, which means there's a two hundred and twenty
00:46:08trillion dollar swing that will come to pass in the life of children now. The
00:46:18world can be two hundred and twenty trillion dollars poorer or two hundred
00:46:24and twenty trillion dollars richer depending on whether we continue to
00:46:28screw up responding to climate change. Ignore it and listen to the worst people
00:46:36in the world to listen to the fossil fuel industry, which is wreathed in
00:46:40conflict of interest on this subject. Crawling with conflict of interest,
00:46:45infested with conflict of interest, and eager to shove that conflict of interest
00:46:52into our politics with lies and dark money, secret influence. It is one of the
00:47:01fouler things that has been done, what has been done in our Congress by the
00:47:05fossil fuel industry. And if Deloitte is right, that two hundred and twenty
00:47:12trillion dollar swing is a hell of an outcome for people who will be alive
00:47:17then, all because we won't make good decisions now. Potsdam Institute says
00:47:26that climate change losses by 2049 could hit thirty-eight trillion dollars and
00:47:33then get bigger after that. So again, we're dealing with a sooner window than
00:47:412070, but we're dealing with very, very, very big numbers. Twenty-five trillion
00:47:46dollar hit to the global real estate sector. Thirty-eight trillion dollars hit
00:47:50from lost agricultural yields, labor productivity, and infrastructure. Two
00:47:56hundred and twenty trillion globally depending on whether we get this right
00:47:59or continue to be fooled by those with the worst conflict of interest. And then
00:48:07recently Allianz, which by the way is the biggest insurance company in the
00:48:13world, trillion dollar company. Two things about the insurance industry and
00:48:20Allianz in particular, the insurance industry needs to predict accurately in
00:48:25order to price its insurance correctly. So first of all, they're making like
00:48:30trillion dollar bets on what the future is going to look like. They're not just
00:48:35lying to make up stuff so that they can sell more gasoline next year in
00:48:41California and Rhode Island and other states. They have to look out. And when
00:48:47they do look out, not only do they have that huge bet that they're placing on
00:48:51what the world is going to look like, what risk they're insuring, they're
00:48:55actually under a fiduciary obligation. They can be sued by their shareholders
00:48:59and by their members if they're not doing proper due diligence and getting
00:49:05it right. So when the insurance industry is doing signals like this, it's worth
00:49:13paying attention. The insurance industry is under a fiduciary obligation to get it
00:49:18right. The fossil fuel industry has a massive conflict of interest to tell us
00:49:23stuff that is wrong and we're believing the fossil fuel industry? It's madness or
00:49:30it's politics or worse. Well, here's what the Allianz board member wrote. We are
00:49:41fast approaching temperature levels 1.5 degrees centigrade, 2 degrees centigrade,
00:49:473 degrees centigrade, where insurers will no longer be able to offer coverage.
00:49:55Entire regions are becoming uninsurable. Sound familiar? Fed Chair Powell used
00:50:05almost the exact same language. They're seeing the same thing. This is a systemic
00:50:12risk. Remember what I said about systemic risk? Here's a board member of
00:50:18the largest insurance company on the planet with a trillion dollars at stake
00:50:23saying this is a systemic risk that threatens the very foundation of the
00:50:31financial sector just like the Commodity Futures Trading Commission report
00:50:38threatened, just like the International Financial Stability Board warned. This
00:50:45is a systemic risk that threatens the very foundation of the financial sector.
00:50:51How? Here's what he continues. If insurance is no longer available, other
00:50:58financial services become unavailable too. A house that cannot be insured
00:51:04cannot be mortgaged. Same deal that the chief economist of Freddie Mac was
00:51:11predicting. No bank will issue loans for uninsurable property. Credit markets
00:51:21freeze. This is a climate-induced credit crunch. He also points out in his
00:51:33article something that I hadn't paid attention to. I was looking at the
00:51:37insurance to mortgage to property values crash. But what he points out is that if
00:51:45you go into the financial sector, big wheeler dealers in the financial world
00:51:51do big deals and transactions and very often those transactions depend on
00:51:58insurance component to make the deal work. And in areas where the risk
00:52:06involved in that transaction is uninsurable, then the transaction can't
00:52:13happen any longer. So it's not just mortgages and the mortgage market that
00:52:20is imperiled by this insurance risk. It's a whole swath of other financial
00:52:27transactions, which is why the title was An End to Capitalism. That is what we're
00:52:43dealing with. There's a lot more that I could go through. Here's my current
00:52:50binder on the economic risks of climate change that includes these articles and
00:52:56more. I've circulated it to Finance Committee members. I've circulated it to
00:53:04Budget Committee members. I've circulated it to Environment Public Works Committee
00:53:08members. I don't think anybody really wants to read it because in this place
00:53:15the fossil fuel industry gets what it wants, whenever it wants, whenever it
00:53:22wants. And the fossil fuel industry does not want the Senate or the House paying
00:53:28any attention to these looming risks, to these storm warnings that are coming.
00:53:35I've been through small insurance collapses in Rhode Island, two of them.
00:53:44One was a banking insurer, a state-backed banking insurer, that failed just as I
00:53:51was coming in as a new governor's legal counsel. And as we saw this beginning to
00:53:57fail, he asked me to handle the issue. So it was a handful of an issue, I'll tell
00:54:05you, because we knew that the insurer was going to fail. And we knew that all of
00:54:14the insured banks would no longer be able to honor their accounts. And we knew
00:54:20that about a third of Rhode Islanders had money in those various banking
00:54:25institutions, and that they would lose access to their funds until we could
00:54:28sort this out. And it happened the day that the new governor was sworn in. I can
00:54:35remember preparing the needed papers to take over the closed institution in an
00:54:42all-nighter in a law firm, and in the morning running the papers up to the
00:54:48governor's office through the cold weather of a Rhode Island January, as the
00:54:52guns were firing, signaling the start of the new administration, the ceremonial
00:54:58guns of probably the Newport Artillery Company. And on day one, we had to close
00:55:06all these banking institutions, and I spent the next many months of my life
00:55:10trying to figure out how to get them back, get depositors repaid, and clean up
00:55:16the insurance system. So I know that when Ernest Hemingway, when asked, how did you
00:55:30go broke? And he said, gradually, and then all at once. That's how these insurance
00:55:44crises happen. The Rhode Island Share and Deposit Indemnity Corporation
00:55:51went broke gradually, and then all at once. It was just a matter of days from
00:55:59steady state status to complete calamity, and we had to dig our way back out of it.
00:56:06The next one was workers' compensation insurance. That too, gradually, and then
00:56:14all at once. Like the California Fair Plan, we had a backstop insurance entity
00:56:21that, if you couldn't get insurance in the regular market, you'd go to the state
00:56:27entity, and then your risk would be farmed out to all of the other companies.
00:56:34Which is fine, if it's two or three or four percent of the market, but when that
00:56:38company starts to have a huge share of the market, and huge losses, and the
00:56:45insurance companies look around and say, wow, we're going to own our share of
00:56:48those losses? I don't want to do business here any longer. They came in, and in a
00:56:54matter of a day or two, every single workers' comp insurer in Rhode Island had
00:56:59said, we're out of here, we're done, we're closing. And we had until the end of their
00:57:04policy to stand up a whole new workers' compensation system that paid for itself
00:57:13and was fair to workers. Between those two things, I don't think I've ever worked
00:57:17so hard in my life, but we solved both of those problems. Now you may say, well
00:57:22that's just a little problem in a little state. Yeah. Many years ago, my father set
00:57:29up Special Operations and Low Intensity Conflict in the Defense Department. He
00:57:35was the first SOLIC, they called it. And one of the things that the people in
00:57:40Special Operations really didn't like was that being told what they were doing
00:57:43was low intensity. Mr. Whitehouse, when it's you that's being shot at, it's not
00:57:48low intensity. We've got to get rid of that name. So small fights can be brutally
00:57:55intense fights. And these were small but brutally intense situations in Rhode
00:58:01Island. And the lesson to me is really clear. These things happen gradually and
00:58:07then all at once. And we are well into the gradually part of what climate
00:58:13change is doing to insurance markets and the cascade from that into mortgage
00:58:18markets and into property values and into economic recession is now entirely
00:58:25predictable. Indeed, predicted by essentially anyone who is A, paying
00:58:33attention to this, and B, not on the payroll of the fossil fuel industry. So
00:58:46when we're messing around with Senate parliamentary procedures, when we are
00:58:54actually going, threatening, maybe cooler heads will prevail, threatening to go
00:59:00nuclear, threatening to overrule a ruling of the parliamentarian, just to run a
00:59:08political errand for the fossil fuel industry, to help it sell more gasoline,
00:59:13we're doing two really evil things at once. We are doing real damage to this
00:59:23institution that will be very hard to walk back from. And two, we are indulging
00:59:30an industry with a massive special interest and a massive conflict of
00:59:37interest that is simply out to sell more gasoline and that wants us to
00:59:47ignore the risk that its emissions are creating in the world. And we are now in
00:59:55this building so overwhelmed by that fossil fuel political influence
01:00:01infrastructure, all its dark money running through super PACs, all its lies
01:00:06being spouted out by phony front groups, all of the fake scientists making up
01:00:11stuff that isn't science but sounds good because it was cooked up on Madison
01:00:16Avenue to sound good, and now they've actually infiltrated the office of
01:00:21government and they're running the US government from the inside with a view
01:00:26to making sure that nobody pays attention to the climate harm. And I'll
01:00:37close with a different point, which is that I've spent my time so far on the
01:00:45floor talking about how a corrupting industry has used its influence in
01:00:56Congress to steer us away from paying attention to a massive economic risk
01:01:03that numerous expert voices have warned us is in peril. And not just expert
01:01:16voices but many who are under a fiduciary obligation to their
01:01:19shareholders. We had in the Budget Committee the CEO of Aon, which is one of
01:01:24the biggest companies, insurance companies in the world. He's their
01:01:28US CEO. He came in to testify and give that same warning over and over and
01:01:33over again. We're getting that warning about the economic peril that is looming
01:01:38where we're now into gradually and we're waiting for all at once to happen. And I
01:01:48talk about that as an economic matter because this is the House of Mammon
01:01:57where the worship of the fossil fuel God Baal and money is the number one thing
01:02:04that we do. So I'm speaking in the terms that the Senate and the House most pay
01:02:11attention to, which is money. Money. But know that behind the economic peril is
01:02:22real natural disaster, is real tumult in the natural systems of the earth that
01:02:34have allowed our species to develop for 20,000 years in a relatively safe harbor
01:02:43of limited atmospheric carbon, a healthy climate range, moderate storm activity,
01:02:55and a robust ecosystem around us where that security and that safety have
01:03:03allowed the ecosystem to flourish. And it happens in a million small ways. One of
01:03:08my favorites was the red knot. There's a bird. It's called the red knot. It lands
01:03:16in Delaware every year. And lots of them land in Delaware every year. And they
01:03:20come to Delaware every year because the horseshoe crabs in Delaware Bay come
01:03:29ashore to lay their eggs. So it's like social hour for horseshoe crabs, but it's
01:03:38also feeding frenzy for birds like to eat the horseshoe crab eggs. But here's
01:03:48the deal about the red knot. Bet you don't know where it came from to get to
01:03:54Delaware Bay for that moment when the horseshoe crabs are laying their eggs.
01:04:05They come from Brazil. They've come from all the way down in Patagonia and they've
01:04:11flown up to Brazil and then they go from Brazil over the water to Delaware Bay.
01:04:18Imagine how long it takes to fly from Brazil to the East Coast to Delaware in
01:04:29a jet plane. These little birds, they do it on their own. They're not big. They're
01:04:38about that big. And they fly all that way on their own. It is such an arduous
01:04:43journey that their bodies actually metamorphose a bit during the journey to
01:04:50make it possible. It's one of the miracles of creation that this little
01:04:54bird can make that astonishing journey and have the physical changes to its
01:04:59body that take place during that trip make it possible for that little bird to
01:05:04make that journey. And the reason that species makes it and survives is because
01:05:11in God's great ecosystem they have figured out that if they land at this
01:05:19time in this Bay the food will be there for them. And if we screw that up with
01:05:25fossil fuel emissions so that the schedule of the horseshoe crabs egg
01:05:31laying goes off and those red knots come all the way from Brazil and there are no
01:05:40eggs there for them, they're too late, they're too early. That's how populations
01:05:48crash. That's just one tiny example. That's one thread of this beautiful
01:05:56interlocking natural planet that we have. And there are a million more such threads
01:06:04that put the world together that we take for granted. Behind the looming
01:06:14economic risk is a disruption of the Earth's natural systems that goes well
01:06:26beyond just economic harm. It means that the creek where your grandfather taught
01:06:35you to fish and where you want to teach your granddaughter to fish isn't going
01:06:42to have the fish in it any longer. Can you put a price on that? Nope. It means
01:06:50that the water flowing out of the Himalayas fought over between Pakistan
01:06:55and India forever becomes less because there's dramatically less glacier in
01:07:01the Himalayas to provide the glacial flow down into those rivers. And now you
01:07:07have a conflict between those countries over that most elemental need of humans,
01:07:13water. Can you put a price on that risk? Coastal homes all over the world are
01:07:27being lost to sea level rise. After Superstorm Sandy, I walked the beaches
01:07:34near Matunik, Rhode Island, and there was a man standing on the shore near his
01:07:40house. And his house was tipped over because the storm had eroded the
01:07:49foundations of it. And he was looking at his house. They'd spent time going into
01:07:54it. It was tipping over. It was dangerous to go in, but they'd been getting out as
01:07:57much stuff as they could. And I asked him, you know, tell me the story of this
01:08:02house. It was a nice old house. They'd been there a long time. He said, well, I
01:08:05remember being here as a baby. It was my grandparents' house. They came here in
01:08:11the summers. And it was beautiful. We had all this beach in front of us. We even
01:08:14had lawn in front of us. And the thing I want most in my life is to be able to
01:08:20pass this home on to my grandchildren, to have this family tradition, generation
01:08:25after generation after generation, to be able to come to this beautiful place and
01:08:30enjoy this beautiful shore and continue this glorious family tradition. How do
01:08:36you put a price on that when that's taken away? Because we're too damned
01:08:41lazy and indolent to clean up the fossil fuel industry's mess when they won't do
01:08:49it. My point is that as I focus on the economics of this, because that's what
01:08:55people care about in this place, there is a whole other set of costs to
01:09:01mankind and to our earth that we will be forcing future generations to bear that
01:09:09have nothing to do with the almighty dollar, but actually may be worse in
01:09:15terms of humankind and the human spirit. With that, I'll yield the floor.