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A Conversation with John Kerry

Speaker: John F. Kerry, U.S. Senator (D-Ma)
Presider: Richard E. Salomon, Chairman, Mecox Ventures, Inc.
October 29, 2007
Council on Foreign Relations New York, NY

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RICHARD SALOMON:  Good afternoon.  Can I get your attention, please?  It's a pleasure for me to welcome Senator Kerry and all of you to today's program at the Council on Foreign Relations.

Before I introduce Senator Kennedy -- Senator Kerry --

AUDIENCE MEMBERS:  Boo!

SALOMON:  -- let me -- let me make two announcements.  First, turn off the cell phones, and secondly, Senator Kerry's remarks today will be on the record and so will the entire program.

Senator Kerry, of course, needs very little introduction to this audience or, I guess, to any audience for that matter.  He was the 2004 Democratic Party nominee for president.  He has served as a U.S. senator from Massachusetts since 1985, and in the Senate has served on the Foreign Relations, Finance, Commerce, Science and Transportation Committees, and was also the subcommittee of the Science, Technology and Innovation Committee, which is going to be important for the topic we talk about primarily today.  In addition, Senator Kerry served two tours as a naval officer in Vietnam, was awarded a Silver Star, a Bronze Star and three Purple Hearts as a result of that service, and we all know he's an accomplished skier and windsurfer.

Senator Kerry will talk to us today primarily about climate change as a national security issue.  This is not a new topic for him.  He's been speaking out on the topic of climate change for some 20 years now and has promoted hi-tech green solutions to stabilizing climate change and called attention to the economic risks of failing to address climate change.  He's also advocate for the adoption of innovative and strategic national energy policy.

In December, Senator Kerry will be leading a congressional delegation to the U.N. conference in Bali, the purpose of which is to map out a frame work to replace the Kyoto Protocol, which expires in 2012.  This is a daunting and vital undertaking, and Senator Kerry, we look forward to your thoughts on this topic and other topics you choose to talk with us about.  (Applause.)

SENATOR JOHN KERRY:  Well, Richard, thank you very, very much for your introduction.  I completely forgive you for mistaking me with my senior colleague.

I want you all to know that is -- it really is explainable, and I'm not sure what it is about -- I guess it's the onomatopoeia, whatever you call it, but it happens frequently.  And I have to tell you, once I was being introduced by a fellow by the name of Ted Kennedy, and he was waxing on -- and all of you know how Ted can really get going and he's terrific and energized -- and he starts getting carried -- he says, "Ladies and gentlemen, it's my pleasure to introduce to you the junior senator from Massachusetts, John Kennedy!"  (Laughs, laughter.)  So Richard, if it could happen to my colleague after about 16 years, it can happen to anybody, and I'm -- I've grown totally accustomed to it.  Thank you for the introduction.

Thank you -- thank you all of you for the pleasure of being here before this terrific institution, which I have been a member of for many, many years, though I haven't been able to partake of it as much because I'm doing it in a different forum.  But it's a pleasure to be here and to be here with my sister, who I think enjoys these meetings a great deal -- Peggy, who works over at the United Nations and has worked there for many years now -- and my stepson, Christopher Heintz, who is a new member here and who enjoys that membership.

Let me -- you know, I promised I wouldn't gloat for too long about the Red Sox -- (laughter) -- and that's about as long as I will gloat for, but it is a -- it's funny to sort of watch the Yankees going through this turmoil all of a sudden because we've been so many years of it that somehow it's good that it isn't in Boston for once.  And that's all I'll say.

Here's what I would like to do -- and I think it's what you would like to do also -- and that is to sort of maximize the dialogue and minimize the rhetoric and minimize the senatorial pontification and try to get down to the nitty-gritty as fast as we can.  This is a smart group of people.  All of you have thought about these issues a lot, and I think, therefore, the more we can dialogue about it, the better.  And I'm not going to spend the whole time -- I'm going to spend the time of my introductory comments on global climate change, and I think you'll see why when I do it, but I also want to invite any questions that you would like to explore with respect to the obvious, ranging from the Middle East, where I now serve as chair of the South Asian Mideast Subcommittee on the Foreign Relations Committee, obviously, Afghanistan, Pakistan, Iraq, the war.  There are just as many issues as there are locations in the world today, and I'm happy to tackle them as you would see fit.

But it seems to me there are, above all, three predominant challenges in terms of the foreign policy of our country, which is obviously a challenge that it has been in a long, long time.  This is the most extraordinary period of negligence, arrogance, indifference, incompetence mix of engagement with respect to world affairs to the degree that we are obviously -- and everybody knows this within certainly opinion circles -- as troubled as we have been as a nation in terms of our credibility and our leverage at any time in modern memory.

It's been so repeated almost in these last months that you don't have to go back through the litany of the whys and wherefores.  The question is:  Where are we going to go, and how are we going to get there?  And I would respectfully suggest that a great deal of that is going to be answered automatically the moment we have a new president, and it will be an unprecedented moment of opportunity to move on any numbers of fronts simultaneously that can much more rapidly than a lot of people think make up for the roads untraveled in these past years.  To some degree, there may even be a pent-up demand that, with the right creativity and the right leadership, will afford us an opportunity to do some things that you might not otherwise have been able to.  And I really believe that, particularly if the outcome with respect to the Congress is also, and I hope it will be with respect to the presidency.

But let me just summarize.  There are three most significant compelling international issues, none of which are receiving the attention and the creative diplomacy that they deserve. 

The first, obviously, is the war on terror itself, as it's been named, ineptly and inaptly, but the whole question of extreme jihadism, under whatever rubric you want to put it. 

The second is -- remains something we've lived with all of our lifetimes, and that's the nuclear challenge and the challenge of proliferation and the ability to continue what we started with Nunn-Lugar and the other efforts in terms of securing those -- that fissile material that's already out there. 

And the third -- and this is the one I want to talk about briefly today -- is now global climate change, in no uncertain terms. 

Time magazine recently had a headline and it said, "How to Prevent the Next Darfur."  Step one:  get serious global climate change. 

So when you see what is happening there, you've heard the warnings -- drought, famine, floods, refugees, devastated crops, lost GDP, instability, border tensions -- I mean, all of these things are growing in their ability to confound all of the other efforts of global institutions and the kinds of developmental efforts that we've engaged in and spent so much money on and expended even so many lives in support of.

I'm pleased that the council itself is pursuing this, and I look forward to reading the report that comes out from George Pataki and Tom Vilsack.  I think it'll be hopefully important and add to our ability to put this in its right context. 

But let me just share with you quickly.  Since the IPCC report -- and I'll give you a little background.  I was privileged to be part of the first hearings that we held in the United States Congress on this subject, with Al Gore, on the Commerce Committee, where we sat together in 1987, 20 years ago.  Twenty years ago, we held hearings on this topic.  Twenty years ago, we had scientists in America who were already laying out the science to us. 

And subsequent to those hearings, Al and I and Tim Wirth and John Chafee and others joined together as part of an official Senate delegation to go to Rio, to the Earth Summit, and in Rio we helped to lay the foundation, with others, many others -- an event, incidentally, in which George Herbert Walker Bush, as president, came to and spoke, and the administration joined in, in creating the voluntary framework of the United Nations, which we've operated under for all these years. 

We left Rio with hope and with a sense of optimism about the possibilities of the future, 150-plus nations signing on to this agreement.  Only the United States of America has not ratified what came out of Kyoto and what we -- came out of that agreement.  And over the ensuing 20 years, I attended the conferences, the so-called COP conferences, Conference of the Parties, in The Hague, in Buenos Aires.  And subsequently I was in Kyoto, where I joined with Stu Eizenstat and Vice President Gore, then, in helping to try to shape what came out in terms of the Kyoto agreement.  And I managed the Kyoto agreement on the floor of the Senate when that 95-to-0 vote took place, which was never properly interpreted for what it was and what we said it was at the time.  It was not a rejection of Kyoto per se.  It was a rejection of the notion that you can solve the problem without having less developed countries and others in some structure by which you're bringing people simultaneously, all of them, to the table. 

Now, the IPCC report came out, and there's been now a year and a half of additional science that has come forward since that report was made.  And this is what's important and what I wanted to kind of lay out to you today as an introductory comment.  The IPCC report was cut off towards the end of 2005.  So we've had fully all of 2006 and the better part of 2007 now to digest what it warned us about or what it may even have been occasionally inconclusive about.  And since then we now know that the models understated the sea level rise that was being measured and witnessed.  Over the last 20 years there has been a 25 percent faster sea level rise than any 20-year period ever recorded and ahead of what all the models suggested as a result of the 2005 IPCC study. 

We now know there is a very close relationship between temperature and sea-level rise.  And that has been true throughout the 20th century so that now, they are predicting, absent the West Antarctic and absent the Greenland ice sheet, that we would have somewhere between 20 inches and 55 inches of increase in sea level over the course of this century. 

Now, to some people, that may not seem consequential, but 2-to-3-feet-plus is enormous to islands and lowlands all around the globe.  And there would be some 50 million people displaced as a consequence of just that now-conservative prediction based on fact. 

In addition, point two:  Warming has pushed to the upper predictions of all of the models that were laid out, so there's not cushion there in those predictions.  Whereas some people said it's going to be in the low end; it'll be in the -- it's all in the upper end.  And that means that over the last 16 years, there's been a 6 degree Fahrenheit increase, which is the very upper end of the IPCC report of 2001.  And over the past 9 years, we have lived through the warmest successive years of the last 25 years of measurement. 

In addition, that, coupled with the sea-level rise, is of particular concern for the following, now newly-noted, point.  The Greenland and West Antarctic sheets are melting at a record rate.  Now, why isn't that of greater concern?  For the simple reason that the ice -- the sea ice of the Northwest Passage, et cetera, and the Arctic is floating.  And therefore as you all know, by the law of physics, it displaces.  And as it melts, it doesn't change the sea-level rise per se except, to the degree that it melts, it loses its whiteness and its reflective capacity.  It then becomes an absorber of rays of the sun and heats up more and then melts ice faster.  So you get faster into the cycle of melting. 

But the problem is that the sheet ice of the Antarctic and of Greenland is on rock, and so it is not displacing,  And as it melts, it adds per se, and they are noticing.  You can go up to Greenland and see this.  You can see torrents of water rushing underneath the ice as that melting is taking place as an accelerated rate. 

Now, one thing scientists don't know is, what's the slippage factor?  What happens, to the degree that creates a substructure to the ice where, because there's so much water, the ice moves in some massive amounts?  And you had a breakoff up there of the size of the state of Rhode Island on one occasion, for instance, now floating separately as its own island. 

So this is of enormous consequence.  It is melting at a rate of 100 billion tons a year and it is adding about 3 millimeters per year to the level of the ocean.  At its current rate, which nobody knows for sure, it will maintain. 

Fourth, the sea ice itself is at a breaking point.  September 4th of 2007 was the record low and it was 20 percent lower than the record low of 2005, which preceded it.  And the monthly average for Augusts, measured over the course of since 1979 -- it is 31 percent below the average of those averages over those 30-plus years. 

Five:  Species are being measured now as already being severely impacted by the consequences of global climate change.  You can go to the prosaic.  Go to South Carolina, where there would be no duck hunting today in our country if it weren't for the fact that there are foreign ducks.  Go to Arkansas and see a diminution of the population from million-plus down to about 150,000 or so today. 

But more importantly I met the other day with the head of Audubon, who tells me that their gardeners across the country who report to them are now reporting a 100-mile zone of vegetation transition in the United States, and of crops that no longer grow where they used to go, and a transition greatly impacting crops and gardens and species as they move northwards.  In fact, we are witnessing -- there are 1,700 species that have been studies.  And they show a poleward migration of 6 kilometers per decade, and a vertical migration of some 6 meters per decade, since 1959. 

And polar bears, we now know, are increasingly jeopardized, because the ice is melting earlier.  They fish.  They can't go out and fish so they're moving.  And some polar bears are now, as you know, perhaps even on the threatened species.

Six.  We have now learned that tropical forests are far more critical as a sink.  A sink is an absorber of carbon dioxide, and the forests are a sink.  The oceans are a sink.  So we need those forests, but we always thought that northern forests were more important than they evidently are.  We now have found that it is the tropical forests that are far more critical.  And what is devastating about that is that deforestation itself in the last year has released 1.5 billion tons -- metric tons of CO2. 

Twenty percent of all greenhouse gas emissions are coming from deforestation.  And without slowing deforestation from its current rate, we will add 87 -- now, remember what I just said, in one year we did 1.5 billion -- we will add 87 to 130 billion tons over the century, which is equivalent to 10 years of fossil fuel at its current levels.  The danger is, we're not going to continue to use fossil fuel at current levels; it's going up.

Seven, emissions from fossil fuel and biomass burning have doubled the smog concentrations in countries around the world, which is having a profound effect on photosynthesis and on growth and plant life.  Jim Hansen, who's been a hero through all of this -- we can remember his testimony back in 1988 when he first signaled this to us -- Jim Hansen has warned of the super-El Nino, which is an asymmetrical warming between the Western Equatorial Pacific and the Eastern Equatorial Pacific, which creates much greater intensity to the storms and the hurricanes, et cetera.  We haven't had a lot of them hit us this year, but they've been equal number to the numbers that were predicted.  They went to Mexico and elsewhere.

Nine -- and there are only 10 -- nine -- that I'm going to give you today -- (laughter) -- the warmer temperature invites its own set of predicaments.  You can go to Alaska and find some 50,000 acres of forest where it's been infested with beetles.  The pine is dying.  You can go to Montana, where the same thing is happening.  In fact, at Yellowstone the whitebark pine seeds, which are a major source of grizzly food, are infested and dying off, and grizzlies are moving and/or are not being adequately -- receiving adequate nutrition.  And virtually all the whitebark pine stands in Yellowstone area except for two small areas are going to be severely damaged over the next couple of decades as a consequence of this.  Why?  Because it's warmer and they don't die the way they used to when it got cold, and the result is that you've got these infestations and transitions taking place in plant life that we haven't had the ability to adjust to.

And finally -- and this is really critical.  I've been chairman of the Oceans Subcommittee, and I've heard this warning 15 years ago, perhaps, but without an understanding adequately of how to respond to it, and that is this.  I said the oceans are a sink.  Well, the oceans are a critical sink.  They store almost a quarter of the CO2 that we emit.  And we have relied on the oceans to be that storage bin.  But scientists have warned us for some period of time that we don't know to a certainty where the regurgitation point is, when have they reached saturation and then you're really in an explosive situation because it begins to not be able to hold what we've held for all of these years. 

Well, now we know that's happening, folks, not across the board, but it is happening in selected areas where they've studied it.  And there was a report came out about a week and a half ago from a study -- I think the Australian -- University of Australia was doing it -- and the oceans are losing the ability to absorb the CO2.  And we've measured this, incidentally, level of CO2 in the oceans as far back as 20,000 years.  We have a (stock ?) measurement of this through the sediments.  So this is pretty hard science. 

And it can have a profound effect because the acidity of the oceans has grown by some 35 percent because of the amount of CO2, and that's affecting the pH-acidity relationship, which affects all crustaceans -- so starfish, shrimp, skin -- lobsters, crabs, et cetera -- and the barrier reefs.  They are particularly concerned off Australia they may be literally losing the barrier reefs as a consequence of what is going on.

So every single warning, ladies and gentlemen, that Mother Earth herself is giving us is coming back at a greater rate and to a greater degree than our best scientists have predicted.  And so this becomes more compelling than ever because the scientists have also told us, up until two years ago, that we could tolerate a 550 parts-per-million greenhouse gas emission level, which translates into a 3 degrees Centigrade increase in the temperature of the Earth.  They don't tell us that anymore. 

Because of this rapid feedback, we now have had science in America and across the globe tell us no, we can't tolerate 3 degrees -- it's now down to 2 degrees before you get to the tipping point of catastrophic transition -- and 2 degrees and 450 parts per million. 

Now, why is that important?  Well, it's important for very simple reasons.  We are today at 380 -- 370, 380 parts per million.  Before the Industrial Revolution we were at 270.  So it took the entire Industrial Revolution up until now to get us to the 380 parts per million.  That is a cushion that we have up until 450.  You can do the math.  We're already warmed by .8 degrees Centigrade. 

What is up in the atmosphere today and what we are putting up in the atmosphere at a greater level every single day, not a lesser level, is continuing to do damage and will continue to do damage, barring some scientific discovery nobody yet knows about, and the half-life of that CO2 is such that 70 or 80 years from now what's up there today will still be doing damage.  So you can anticipate probably an increase of somewhere in the vicinity of a minimum of .8 further or so, which brings you to 1.6, 1.5, whatever you want to take it at, and that's a cushion of .5, .4 degrees in terms of what you have in terms of temperature increase and a cushion of very little in terms of the increase in parts per million.

The reason that is so important is, over the next 25 years, ladies and gentlemen, oil consumption in developing Asian nations is going to double to 32 million barrels per day, accounting for 80 percent of the increased global demand in the use of fossil fuels, not to mention our own increase in demand.  And right now China is building one pulverized coal-fired power plant per week, and we're planning to build about a hundred next year, over the course of the next couple years. 

China last year built the equivalent -- when we talk about a power plant in America, we usually talk about a power plant that's about 5,000 -- upwards of -- megawatts.  China last year built 114,000 megawatts of power plants, all pulverized coal plants.  This year they are building some 90,000.  And the likelihood is that if we continue without this mitigation and transition, we're going to go up to 700 parts per million on the current pace. 

So, ladies and gentlemen, there's no other way to put it, other than that this is urgent.  We responded to the potential threat of a nuclear weapon eliminating civilization as we know it.  Well, we're staring at another kind of weapon, man-made, likewise, and uncontrolled at this moment, that has the ability to change life as we know it on this Earth.

Now, I can't predict to you what's going to happen, and none of you can either.  But the precautionary principle suggests that we each have a responsibility to be out there doing something more serious about it, and the United States of America has to lead.  We are 25 percent of the world's pollution.

And China -- I've talked to the delegations.  I understand the dynamics.  They view this as a Western conspiracy -- or have until recently -- to stop them from developing and so forth, but that's changing.  China has 16 of the 20 most polluted cities on the planet, and China has watched the Mingyong Glacier disappear, the sacred glacier disappear, and they're seeing changes in the rivers and changes in their climate and changes in their agriculture likewise.  They actually have set emissions standards on automobiles -- fuel efficiency standards that are going to get 37.9 miles to the gallon, better than the United States Senate and better than the Congress and better than Detroit has allowed us to do. 

So the United States has to lead in order to leverage with credibility our ability to build a global approach.  And I will go to Bali as a co-chair with Barbara Boxer of the delegation, and we've already been meeting with the foreign ministers and environment ministers from other countries to try to lay the groundwork for this.  The action is going to be in the Congress, not in this administration. 

And we now have a bill in the Senate, the Lieberman-Warner bill, which many of us have contributed to and worked on, which will set a cap-and-trade emissions standard for the United States.  That will be the standard that we're going to talk about and take to Bali in hopes that we can build a framework to deal with the finance mechanisms, the mitigation mechanisms, the adaptation mechanisms in order to bring people together around an agreement that must be put together in the year 2009, so that we can be prepared to go forward after 2012, when Kyoto has to move into its next phase.

So that's the urgency.  That's the challenge.  It's doable.  What's so galling about this is that there's this huge amount of money to be made by moving towards these technologies.  If we created a global investment fund, a global research consortium, if we joined together as we have on the space station and worked with the Chinese and others for clean coal technology, there are all kinds of possibilities out there about how we could deal with this, none of which are being adequately explored or being put on the table today.  So there is a crying shame dearth of leadership at this moment. 

You know, after the Cuban Missile Crisis, Khrushchev and Kennedy had a telephone line where they talked and had the ability to be able to deal with these kinds of things.  We need some telephone diplomacy again.  We need to get back to a creative effort that's going to meet this challenge.  And I will tell you -- I base this on, you know, now 35 years of being involved in this effort; you all know this because you're involved in this -- your ability to achieve things in the international arena is not just a reflection of the policy.  It's not just a reflection of your president or whatever.  It's a reflection of relationships that you build.  It's a relationship that's built on credibility about your country and the other things you care about. 

To have walked away from Kyoto is to have hurt our ability to lift, the United Nations to deal with Iraq or other things, to walk away from Iraq.  To do the things we've done badly in all these arenas affects the other arena.  And it's the conglomerate of that distrust and of our indifference that has created the predicament we're now in.  I believe we could just change that almost overnight by showing our bona fides, and that begins by stepping up on global climate change.  And I think it will pay off dividends in a host of other arenas. 

Let me throw it open to questions.  (Applause.)

SALOMON:  Excellent.

KERRY:  You want me to sit?

SALOMON:  Well, thank you, Senator Kerry for what were very provocative and sobering remarks. 

I'm sure you're going to have many questions.  What we're going to do is, Senator Kerry and I are going to talk about a couple of these elements of his comments for a little while, and then we'll call on questions from this distinguished audience. 

I want to pick up on one of the points you make with respect to credibility.  I suspect the American people believe in the seriousness of the issues that you outline.  But I also suspect that they wonder if anything will ever come of the efforts to deal with this from a policy standpoint.  After all, we've heard for many years that the issue of energy dependence was a direct threat to our national security, and yet we observe a really bipartisan failure to do anything about it.  We have no national energy policy.  We seem to lack the political will for a tax on gasoline.  We have not increased fuel efficiency standards.  We refuse to increase the imports of ethanol from Brazil. 

In my view, compared to energy dependence, climate change is a little bit less direct, a little less readily apparent and perhaps a little bit less immediate as a threat to our society and to our national security.  So how do you overcome the skepticism?  How do you help us all feel that we're going to fare better with respect to climate change and global warming than we have with energy policy?

KERRY:  Very fair question. 

History moves in currents, as we all know.  And there are certain moments when you can grab something, and then there are certain moments, obviously, where you can't.  It's not that -- and I'll come back to that in a minute -- it's not that the Congress -- that the Democrats actually failed on the energy bill or -- we're still, first of all, negotiating it. 

But secondly, we passed an energy bill, and we passed a funding mechanism.  We looked at the source of problem, which is fossil fuel; we looked at the revenue streams in the country and saw that the most profitable companies in America last year -- $255 billion of profit -- were oil and gas; and we determined, since we were trying to move away from oil and gas and towards alternative and renewable fuel, that it really wouldn't hurt those companies if their profits weren't 255 billion (dollars), they were 230 billion (dollars) instead. 

And so we funded all of these alternative efforts of clean coal technology, wind power, solar, et cetera, with a set of -- with paying for it by walking back the tax breaks that have been given to oil and gas in the years we thought it was going to go -- to be moving in that direction, and putting it in this other sector.

Lo and behold, the power of money in American politics and the power of lobbying created a direct confrontation on the floor of the Senate, and we lost that vote.  We lost it.  Now a few Democrats voted the other way, unfortunately, very few; almost exclusively Republicans voted to allow oil and gas to continue to have those profits at the expense of every choice we just laid out.

So this is the choice as we go into 2008, folks.  Now obviously no one wishes that 2004's outcome had been more different than I do, but at least we laid a groundwork in 2004 and made Maine bluer, made New Hampshire, you know, a bluer state -- the Democratic governor; Washington, Ohio, Colorado, Ken Salazar, et cetera, and began the march towards '06.  And '06 we went further.  We've got six new senators, we won two new congressman, Democrats, in New Hampshire; we began and continued that movement -- got rid of the secretary of State out of Ohio, got a Democratic governor and so forth -- and I predict that that historical march that I opened up with is exactly where we are right now.

I think these issues are going to come to a head in '08.  I think that is what '08 is going to be about.  I think we're going to grow the Senate, grow the House, and obviously and hopefully win the presidency, at which point we're going to have the first moment potentially of progressive legislating in this country since the New Frontier, Great Society, which was the first moment in great terms since Franklin Roosevelt.  And I think that's the course we're on.  And then, I think we will deal with health care; we will have to confront entitlements and the question of Medicare, Social Security.  We will have to confront -- we, obviously, have got to deal with No Child Left Behind and education, and we will deal with the sole question of energy.

And these are high stakes, and that's why some of us are in this business, and that's what you all are making the choice out, that I believe that's what we're -- that's what '08's going to be all about.  So the best hope I can give you is, '06 and '04 made a difference, they're part of the march forward, and we've just got to get the job done this time.

SALOMON:  Let me ask you a question also about enforcement.  Let's assume that through Bali and afterwards you succeed in establishing the kind of successor frame work to Kyoto that you're setting out to achieve.  We've seen in Rio and Kyoto that voluntary compliance standards really don't make much a difference, and so what we need are more binding targets and strict enforcement of those targets to really make a difference.

As you look at the world today, it seems hard to see that the world is in any mood to accept discipline.  We on the energy policy issues have not accepted that kind of discipline.  Look at the European countries.  The euro -- the countries who have subscribed to the euro can't discipline themselves for what are very obvious violations of the budget deficit, which they've all agreed to.  It was very clear what the budget deficit levels would be.  The countries that have violated them are very clear, and yet they have avoided any punishment.

How do you get the world to accept enforcement when in a sort of look-the-other-way world no one seems inclined to accept it?

KERRY:  Well, you have to show -- look, first of all, you can't begin to even talk about it, yet alone do it, if you don't have, in terms of the law, the old theory of clean hands; I mean this is a clean hands deal, folks.  You've got to begin with the high plate -- you know, the high ground, the moral authority, and the United States has absolutely none on this issue.

You know, I found -- and I don't mean to sound trite about this at all, and I hope it doesn't.  But to a degree I have found that nations behave and governments behave, you know, according to what they can get away with sometimes, which depends often on the level of leadership that is being offered in opposition to what they can get away.  When you have strong leadership at a global level -- and we don't today, candidly -- you know, like the teacher's out of the classroom, the kids fool around.  It's sort of basic human psychology.  A lot of people don't do the things that they don't think they need to do, they can get away with it.  Well, nobody feels they have to do anything right now.  Even Kyoto everybody slipped.  Why?  Because the United States of America, which is the world's leader on these issues, is not pushing and cajoling and moving in the way that we did during the 19 -- late '40s, '50s, '60s, where we moved on nuclear weapons with the authority of the U.N. and the Perm 5 and so forth.  Everybody's even slipped on that.

And so what I've found, you know, when I travel to the Middle East or I go to other countries and I meet with leaders, it's stunning to me to listen to their level of mistrust of us and their level of disrespect for the order, so to speak, today.  And so I say to you respectfully that it doesn't matter what the issue is.  Unless you're consistent, unless you're clear and unless you lead by example, it is very, very difficult to achieve any of these kinds of things. 

But, and here's the but, the world is waiting.  Populations all over the planet are waiting for that kind of leadership.  And if you stand up and you're reasonable in it, if you say, sure, we don't want to hurt all of our economies; yeah, we've got to find a way to do this that's reasonable.  You know, we don't want to -- you know, you can, I think find a working relationship that would stun people in people's willingness to grapple with these kinds of issues. 

Now, point two:  There isn't this big, ugly, horrible downside that everybody thinks there is.  I'll give you an example.  When we did the Clean Air Act in 1990, I remember sitting with Bill Reilly and John Sununu.  And we were negotiating with George Herbert Walker Bush, who to his credit negotiated and bought into this deal. 

And I'll never forget, the industry came in.  We were trying to do, you know, sulfur and acid rain and carbon dioxide and so forth.  And industry came in and said, don't do this to us.  It's going to kill us.  You're going to lose jobs; you're going to make us non-competitive.  It's going to cost $8 billion; it's going to take 10 years to do it.  You're going to kill us. 

The environment community came in and said, no, no, no, no, no, that's just all industry stuff.  Don't worry about that.  It's going to cost 4 (billion), $5 billion -- what was it -- yeah, $4 billion, and it's going to take about 2 years, take about 4-and-a-half, 5 years. 

To the credit of Sununu and Bush, et al, they did it.  They bought in with the Senate, and we passed the act.  And guess what, ladies and gentlemen?  You know what happened?  It cost about $2 billion and it took about 2-and-a-half years. 

Why?  Because nobody is able to quantify what happens when a great nation, like the United States, commits the full power of its entrepreneurial market and its research and development, and puts the money there.  Nobody can predict what happens with the technology.  And just like computers and just like weapons and everything else we do, once you start down the road, we're going to find alternatives and cheaper ways of doing this, because the market is going to demand it. 

So the government shouldn't come in and pick the winner or the loser.  The government needs to create the structure that excites the private capital to move in these directions.  And so help me, God, the private capital will do it. 

Now, right now, you're seeing that.  Vinod Khosla and folks out in California are investing hugely in cellulosic ethanol, in thermal solar.  There's a huge thermal solar plant, going up out in Nevada, which is a complete alternative to coal and to nuclear and to fossil fuel.  They're doing a woodchip ethanol plant down in Georgia to prove that you don't have to depend on corn and grain-based ethanol, in order to do this, which is expensive and drives up land prices and food prices. 

So all of these alternatives are just sitting out there.  And I think if the United States were to show the world we're moving in this direction in the most serious way possible, you'll shame other governments into moving in that direction.  And their populations will demand the same kind of response, because everybody wants to survive. 

SALOMON:  Before I start calling on questions from the audience, just let me make one comment in terms of showing the world. 

I attended recently a meeting that Tom Brokaw hosted with President Clinton on this very topic of global warming, and particularly climate change and national security.  It was interesting at that session, because they cited many of the same very compelling statistics that you cited.  Afterwards, at the end of the presentation, it was clear that half of the audience -- this is mostly hedge fund and financial people, investment people, some of the ones who you actually mentioned, who were there. 

The ones who were 45 and over were all very interested in those statistics and in the case to be made for global warming.  The ones who were 45 and under were there already, and they are no longer in need of hearing this case.  What's frustrating to them is that you can't show them what we do now.  What do I do?  This is where showing, I think, can really make a --

KERRY:  Yeah, well, we -- yeah, I agree with that.  Is that -- did you want to --

SALOMON:  Yeah, no, I just --

KERRY:  Well, we can.  I mean, look, I agree with that distinction too between -- but you know, there's an educating process to all this.  But what I've learned talking to people, and we've been working with people on the Street here.  You know, Goldman Sachs and so forth are really interested, and it's very interesting. 

I met with -- working with -- USCAP, which is the, you know -- it's all the big corporations, the largest corporations, that have come together in an effort to try to get a cap-and-trade system. 

So you got Chad Halliday at DuPont; and Lew Hay down at Florida Power, Light and so forth; the head of Siemens; the head of Dow Chemical, et cetera, meeting with all of these people.  They want us to get the cap-and-trade in place.  They want the market to have the certainty as to where we're heading with respect to carbon pricing.  And as long as we have an auction, as long as it's predominantly auction and the market sort of sets the prices, then we can go out and make this happen.  I think people believe in that.  And that's exactly the experience we had again back in 1990.  We set a price originally of over a thousand dollars per unit on sulfur, and eventually, because the market worked so effectively, went down to about 60 bucks, and then it bounced back up to about a hundred, and the trading took place and people had an asset they could trade and so forth.

So there are a lot of things we can do, but the most important is the government is going to have to decide to set the framework.  It's very difficult that -- a lot of companies are moving unilaterally, and they're learning that it's good business, it's good bottom (down ?).  I mean, Bernie knows this.  You know, Dallas-based Texas Instruments was going to move to China, and the workers were obviously upset and came and talked to the management.  They said, "Please don't do this to our jobs." 

So they got together with Amory Lovins at the Rocky Mountain Institute, and he came down and looked at their plans for the plant they were going to build in China, and they redesigned the plant.  They lowered it by a whole floor, from three floors to two.  They designed pipes that, instead of those traditional bent curve pipes, which take more energy to drive the fluids through them, they made them straight-line pipes; created climate control throughout the building; used different kinds of green products.  Net-net, they didn't go to China; they found they could make the savings necessary to stay in Dallas.  It means 88,000 jobs to the community, $14 billion over the life of the plant.  And most importantly, they are netting $3 million a year net profit because they're processing their own water and they're more effective in terms of their heating and use of electricity and cooling and so forth.

Now, this is staring us in the face.  The United States alone is as energy inefficient as we are.  You go to Japan -- you all have -- or Europe and you walk out of your hotel room and the lights come on, and they go down when you get in the elevator.  Did you ever see -- how often does that happen in an American hotel?  You walk up to an escalator and the escalator's not working, and you say, "Oh, God, it's broken."  You get near it, and it starts.  You get off it and nobody else is coming, and it stops.  Ours are just going -- (making the sound of a moving escalator) -- 24 hours a day, all the time.  We waste unbelievable amounts of energy.

So if we get going, there are three big grabs.  Energy efficiency is the biggest, fastest, cheapest, most effective and efficient.  Then you've got alternative renewable fuels and alternative technologies.  And then you've got clean coal technology.  And obviously, coal, we're all better off if we could find a way to burn coal clean because we got so much of it, and so do they. 

So those are the biggies, folks.  And we need -- when you say what can you do, you can take personal decisions about the choices you make, about the kind of car you build, your house, your design, your design of products, the things you buy, and you can help create the political climate so we get the funding to create the structure so that the marketplace will take off.  Those are the two big things.

SALOMON:  Let's turn to questions.  Our usual drill.  Wait for the microphone, identify yourself, and please keep your questions concise and short so we can get as many questions answered as we can.

Yes?

QUESTIONER:  Thank you, Senator Kerry.  I'm Stephen Kass, Carter Ledyard & Milburn.  Cap and trade, which you've referred to several times, will be effective, as I understand it from economists and environmentalists, in dealing with the power sector in particular because there are identified a relatively small number of players, as in the sulfur dioxide cap and trade.  But most economists and environmentalists I've spoken to think that really to be effective and to change the economy, you're going to have to move to some kind of a serious carbon tax.  Similarly, you're going to have to go beyond cap and trade in order to deal with the coastal cities in the developing world that are not going to be able to afford the adaptation that they will need to survive and prevent mass explosion -- social explosions.

And yet I'm told that most people in Congress don't have the courage or the guts to stand up for a serious carbon tax, or even the appropriations necessary to deal with the developing world's needs for adaptation.  What can we do about that?

KERRY:  Well, I've thought about -- I mean, obviously, I hope you think I've thought about this issue a lot.  I have thought about it a lot, and I'm not at a carbon tax yet because I'm not convinced -- genuinely on the substance -- that you can't get this done through the setting of the price of carbons through cap and trade, which effectively is going to -- if it's economy wide.  If it's economy wide, it's going to affect every level of the food chain.  And therefore, you know, you're letting the marketplace, in effect, set the price.  And I think that will move the technology faster. 

Now, I have said -- I know Al Gore has said maybe both -- I've said if you can't get it done through that -- and it's clear, you've got to have lookbacks in this, you've got to have clear measurements as you're moving along -- but you're just not going to get it done, and the science continues to come in faster, then you've got to go that next step.  And I'm -- I'm certainly prepared to do that.  But I don't think the evidence dictates that that absolutely has to be done yet.  That's -- that's the only reason why there -- I think there's resistance. 

And we're going to build some lookbacks into this system, because we're going to have to.  The goal is by 2050 to have a -- you know, the current goal is 70 percent, but we all know we need 80 to 90 percent, so we're trying to get where we can get a starting point and then we'll move further down as fast as we can to meet the targets.  Yes.

I'm happy to move on to any other topics if people want to.  Yeah?

QUESTIONER:  Well, I'm going to do that.  Marlene Sanders, former television journalist.  We're happy to have you here and hear your views.  We've missed you.  And I think a lot of people expected you would be an outspoken critic of the administration, but we haven't heard very much from you.  And I'm wondering whether you've backed off --

KERRY:  On what?

QUESTIONER:  -- or you're not getting coverage.  On -- what everything they're doing.  (Laughter.)  Have you not been getting coverage, or have you backed off?

KERRY:  Well, I certainly haven't backed off.  I think I've been about as outspoken as I've ever been.  I gave a series of speeches at Faneuil Hall in Boston -- which were well covered -- in which I laid out an agenda on the war on terror, on energy, on all of these topics.  I think I've been so outspoken -- I was on "Meet the Press" recently debating John McCain on Iraq. 

And during the debate on the war, I led the fight.  It was my amendment that was brought last summer that got 13 votes to set a date in Iraq.  And if you recall the front page of the New York Times, some of my colleagues were furious at me for forcing them to the vote and, you know, forcing the issue.  By the end of the summer, it was the closing argument of the Democratic Party.  That's why we won the seats we won in 2006. 

So I think I've been anything but bashful, and anything but -- clear in all of these issues.  It's hard -- look, I'm not running for president.  And I have learned since I've not been running just how painful that can be in terms of getting coverage or not getting coverage.  There's a syndrome in American media that you're -- you know, that's where everything is happening.  But I'm, you know, happy doing what I'm doing and will continue to work it.  And I'm certainly not shy and bashful and reserved and held back.

SALOMON:  Let's stick with climate change for the moment, and then if we run out of questions there, we'll go to other topics.

 Yes, in the back.

QUESTIONER:  Lansing Lamont.  Senator, and on your very thoughtful remarks and subsequent dialogue, I have never heard the word "nuclear" mentioned, as in nuclear energy.  And yet we've been told over the decades this is one of the cleanest forms of energy there is.  Why is there such a politically (sic) taboo on this?  Why has it been a political nonstarter for so long?  Why can't we get over Three Mile Island if the French, for example, have most of their energy nuclear energy and have also figured out an effective way to get over the bugaboo of how to deal with their waste; namely, by recycling it?

KERRY:  Well, some of it.  They do some dry gas and pool storage too.  So it's not all recycled. 

There are three principal reasons that nuclear remains a problem.  Reason number one is the economics.  Wall Street's not going to support a nuclear plant right now.  You can't finance it.  It's too expensive.  Maybe that'll change, but the siting and so forth remains an enormous problem. 

Number two, the proliferation issue.  I mean, we need -- America and the world need a new proliferation protocol.  And we would stand a chance, in my judgment, of getting nearer there if we had a different attitude about how to approach Iran and engage in a serious global discussion that involves thinking out of the box a little bit, which means thinking about everybody's supply source for fissile material and how we verify it and control it. 

The United States, in this newer world that is emerging, is going to have a harder time acting in a sort of "this is for everybody else, and this is for us" way.  And I think to earn the credibility and the fast movement in certain directions that we need, we're going to have think carefully about the IEA process, our own level of verification, our own level of -- I mean, look, we didn't do the nuclear test ban treaty; we've continued down the -- I mean, the chemical treaty.  We're sort of viewed by a lot of folks as kind of outside of our own values, if you will, and the things we have preached for a long period of time, and I think we've got to get back there.  So that's number two.

And number three is the waste issue itself.  It remains an enormous problem.  We haven't even been able to site Yucca Mountain -- and I was against siting Yucca Mountain because of the earthquake analysis there -- but we don't have a national depository; we have 50 patchwork efforts, people transfer to different states.  It's a -- you know, it has its own risks, and we've got to get that under control.

Now -- and there's a fourth reason.  The fourth reason is that Jim Hansen and most of the scientists tell us we have about a 10-year window to get this right; a 10-year window to get this right, if you look at the pace of the CO2 emissions that I just described, means you've really got to say now, today, now, no pulverized coal-fired power plant is going to be built without capture and sequestration.  Now I've introduced legislation to do that; it doesn't have a prayer of passing today, notwithstanding everything that I've just said to you.

But that's a reason you can't do it in a 10-year time frame.  You can't do what you need to -- you won't build enough nuclear plants to deal with the kind of crisis we face in terms of fueling America, and you're only dealing at that point with power for air conditioning and electricity.  You're not dealing with transportation and the other fossil fuel issues we face.  There's one other -- there's actually an 11th biggie that I didn't mention, which I should because it's important in this context -- because of the melting of the permafrost, large pockets in Siberia, Alaska and elsewhere have methane that have been frozen for several hundred thousand years are now being exposed and are opening up.  Methane is 20 to 30 times more powerful than CO2 in the damage that it does, and if this continues and these methane pockets kind of start exploding around us, you're going to have a much greater response.  So we're really, I think, on an urgent clock, and nuclear doesn't quite meet that urgent clock.

Now, the book I just recently wrote with my wife talking about these challenges, I did have a small section on nuclear, and I said it would be part of the mix.  And I don't rule out, you know, if we can solve those kind of issues.  I don't rule it out as something that can be part of the mix at all just because of the urgency of this issue, but you've got to solve those other issues.  Now the financing may take care of itself out of urgency, but the waste and proliferation pieces we've really -- you know, you've got to put together and give people greater confidence that you're not opening Pandora's box and a new can of worms.

SALOMON:  Time for a couple more questions.

Sir.

QUESTIONER:  John Brademas, New York University, 3rd Congressional District of Indiana.  That was a brilliant analysis, Senator, and makes the case, in my view, for educating the American people.  I think it was about 30 years ago that I wrote the Environmental Education Act in Congress, which authorized federal grants to schools for teaching about the environment and the universities preparing teaching materials.  That legislation under this administration has sort of disappeared, and it would seem to me imperative, if we're to make progress along the ways you've suggested, that we need to educate the electorate.

I understand that measure is now in EPA.  I don't know what's happened to it.  Do you have any idea what's happened to environmental education in this country?  I should have thought that educating the American people, beginning in school, would help immensely --

KERRY:  Yeah.

QUESTIONER:  -- deal with the problems you've discussed.

KERRY:  Well, John, I'm thrilled to hear you say that.  First of all, thanks for your many years of terrific service. 

Teresa and I back in 1995 started a foundation called Second Nature.  And it was specifically to teach teachers how to teach using the environment as a means of teaching.  It's still in existence, but it has been difficult to get it to the level that we've wanted to because of just the complete kind of indifference and sort of lack of imagination, I guess, for a better word, within the hierarchy about sort of how people want to teach and what they ought to be teaching.

Our theory was exactly that, that you use environmental materials to teach in architecture, in design, in -- oh, God, any number of different disciplines, and even use it in language classes, so people become conversant with some of the questions and concepts.  And that way, when kids came out of school asking questions about the kind of materials they're using or what the harm is downstream or what the agricultural practice runoff might be, became second nature.  That was the whole theory of it, that everybody grew up in a new generation automatically moving in these directions, so we have sustainable practices. 

It's just -- you know, as you know better than anybody, it's harder than hell in America to get any school district to embrace any new pedagogy, let alone something that some people sort of question as being ideological and/or party-oriented. 

So it comes back to leadership, folks.  I mean, you really got to have leadership to take these on.

And I've found, I've learned -- I mean, the great thing of running for president was getting to parts of the country you don't normally go to.  And I regret -- I wish I'd had more time to go to some of these communities, because I find that when you could really talk to people, face to face and disarm the stereotypes and the fears, you can find common ground on these things.  And I think Americans are sort of hungry for it.

So hopefully -- you know, a lot of universities are in fact embracing a greener agenda.  A lot of them are teaching more effectively.  Yale, I know, for instance, has now got an entire nutrition program based on sustainable production.  And a lot of the colleges and universities -- there's a group of presidents -- I met with them down in Washington; they came together, several hundred strong -- who are moving their campuses towards a greener set of practices in terms of what they're doing with their buildings and their equipment and their fleets of vehicles and so forth.

So there's more happening, perhaps, than people know.  But think what could happen if you've gathered all of this and put it into a critical mass and really got it out there. 

Are we almost out of time? 

SALOMON:  We are.

KERRY:  Could I just -- can I just say one thing, since we're out of time?  I thought there might be a question on Iraq and Afghanistan and so forth.  I just want to leave a thought with all of you.  First of all, Afghanistan is just a huge challenge for us and getting worse, not better, unfortunately.  And it lacks a unified command.  It lacks a unified reconstruction command.  It is not out of reach, because the level of Talibanism is not so broad spread at this point that we can't get a handle on it. 

But I'll tell you, absent some very significant moves soon, it could become very troubling.  The Kabul -- you know, the Karzai government in Kabul is becoming quite isolated from the governorships.  There's a lot of unrest, a lot of corruption.  Ninety percent of the world's heroin is coming out of there, 50 percent of it from one particular area.  And we still don't have a unified cooperative effort between the various U.N. factions that are there -- I mean the NATO groups.

And NATO itself is at risk in this process.  I mean, there's a huge challenge to NATO in the long run if we don't get this right and do this.

The tragedy is, when you go back and sort of look at the history of it, the degree to which we took out the CIA and military people who were competent when the 2001, you know, invasion took place and shifted them to Iraq and the degree to which we don't have a sufficiency of capacity there because of the shift to Iraq is just -- it's painful, literally painful in terms of America's real security interests. 

And then you look, obviously, at Iran, where you have an Iran that is more powerful; that knows our bellicosity and threats are nothing, you know, that can be completely followed up on, except in the worst and gravest consequences, which they understand.

So we're just diminishing ourselves and digging our hole deeper.  Hamas is stronger.  Hezbollah's stronger.  I was in Lebanon recently meeting with the Siniora government and others, and I met with Hariri when he came over here recently.  And you know, they're on this precipice, where you have a real democracy that's trying to survive, barely getting the support from us, when we're trying to create a democracy where there's never been one, to the tune of billions and billions of dollars in the wrong way.

I mean, folks, everybody here in this room who cares about this stuff it just, you know, tears your guts out to see the real security interests of our country so ineptly and badly served.  And the war on terror itself is such a misnomer measured against the global sort of counterinsurgency with these 60 different countries and 60 different kinds of al Qaedas and kinds of interests -- all of which demand a global response, and we have to take it seriously.  I'm not diminishing it one bit.  But we're just conglomeratizing them into this one group with this maxi-focus in Iraq, and therefore, winding up with a National Intelligence Estimate that's telling us how al Qaeda is more dangerous today, how they're reconstituted and the interest of our country is set back.

So for those of you who measure these things, you know, as the Republicans run around the country with this bellicose talk and saber rattling and as we measure the real interests of our nation, I believe this is a year perhaps not unlike 1960 with Kennedy and Nixon, where we ought to stand up and call them for what they are.  They're paper tigers.  They're making America less safe.  They are in fact not protecting the security of our country; they're making it worse.  And I believe that we have a better plan and a better way of providing for that security, and I think we ought to draw that line as clearly and as distinctly as we ever have and make it clear to Americans there is a much better choice by which we can be protected and look to the long-term interests of our country.

So thank you for the privilege of sharing thoughts.  (Applause.)

SALOMON:  Thank you, Senator Kerry.

KERRY:  My pleasure.  Thank you.

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