Baby orangutanPhoto: Rhett A. Butler, MongaBayBoth President Obama’s proposed budget and especially House Republican proposals fall significantly short of the administration’s $1 billion pledge for short-term forest finance made at the Copenhagen climate summit – putting the United States’ climate credibility at even further risk. However modest, the $1 billion pledge was one of the few concrete, deliverable commitments on international climate finance that the United States has made.  Without these funds, the United States will be doing very little indeed to address climate change internationally.

Here’s the breakdown:

According to the administration’s revised numbers, the United States is currently spending the $169 million authorized for tropical forests for fiscal year 2010 – and the continuing resolution that is currently in force to authorize funding for 2011 includes the same levels of funding.

But House Republicans are looking to slash the 2011 figure – if they cut it in line with overall development assistance that will bring forest funding down to a measly $100 million. There’s a significant likelihood that House Republicans will target this funding for even deeper cuts.

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For 2012, the President’s budget includes a fairly healthy $421 million for forest programs such as Reducing Emissions from Deforestation and Degradation (REDD+) – though even these funds don’t add up the $1 billion pledged, even under the most generous of accounting. Of course, it’s far from certain that Congress will appropriate the full amount. Even under a best case (and extremely unlikely) scenario in which forest funding for 2011 is maintained and the President’s full $421 billion is funded, the administration will still fall $241 million short of its $1 billion pledge. In practice, the gap is more likely to be in the $400 to $500 million range.

One silver lining: the President’s budget for the first time contains $1.3 million in dedicated funds for enforcement of the Lacey Act’s ban against import of products from illegal logging. Although it falls short of the $13-$14 million needed to fully enforce this law, it’s a great step forward – and given the outsize gains from enforcement of our laws against illegal logging, appropriators should consider setting aside some of that $421 million aside for Lace Act enforcement.

SO…how can the administration fulfill its tropical forest pledge and avoid once again coming up short on a promise to the world? The Millennium Challenge Corporation.

The MCC is a development assistance entity created during the Bush administration that receives over $1 billion a year to be spent in bilateral development assistance for countries that meet certain economic, governance, and “freedom” benchmarks. This year, they are in the process of completing a bilateral development assistance “compact” with Indonesia that is anticipated to run about $700-$800 million (though this could be cut too).

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The MCC has normally funded very traditional development, such as road-building, and has too often looked at the environment as something to avoid harming rather than something to actively protect. However, given the major obstacle that deforestation presents to Indonesia’s development in terms of depleting their natural resources, declining employment in the timber sector (no wood left to harvest), soil erosion, the giant brown cloud that fouls the air every year from forest burning, pollution of water, and vulnerability to weather and other disasters, there is no better way to use this money than protect forests. If there’s any country whose people desperately need green development, it’s Indonesia!

Just one example: the 2004 tsunami was way worse because of the destruction of the mangrove forests that had provided a natural buffer between the sea and the people.  

For these reasons, a diverse group brought together by the Commission on Climate and Tropical Forests, including Center for American Progress CEO John Podesta, former U.S. Army Chief of Staff General Gordon Sullivan, and President Bush’s Deputy Interior Secretary Lynn Scarlett, and many others have all called for a very significant percentage of these funds to be dedicated to forest protection.

Despite the enormous development benefits of forest conservation and sustainable management, there are still some people at the MCC who don’t understand that building a dam or bridge isn’t always the best path to prosperity, who are willing to turn a blind eye to Indonesia’s extreme vulnerability to natural disasters, or who don’t understand the enormous proven benefits of green development. MCC CEO Daniel Yohannes (a former banker who founded the New Resource Bank to finance green projects and environmentally sustainable business) seems sympathetic. Unfortunately, there’s still too much of a 1950’s development mindset in which the only path to prosperity is through exploitation of natural resources rather than their conservation at the MCC.

President Obama needs to talk directly with the MCC – and let them know that his personal credibility, the hopes of the Indonesian people, and even the fate of the climate hinge on their decision.  


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