President Joe Biden rescued at least part of his ambitious agenda from the drain this week, securing the support of enough Democrats (including pesky outliers Senators Joe Manchin and Kyrsten Sinema) to pass one of the biggest, most consequential pieces of economic policy in ages. It’s not quite the $3 trillion game changer Biden and many other Democrats dreamed of, but it will bring sweeping changes to many parts of American life — perhaps most significantly to the fight against climate change.
The nonpartisan Committee for a Responsible Federal Budget estimates that the bill will funnel around $385 billion towards the environment, much of it geared towards cutting carbon emissions. Senate Majority Leader Chuck Schumer says the bill would reduce U.S. carbon emissions by nearly 40 percent by 2030 — less than most scientists say is necessary, but far beyond what activists have grown accustomed to expecting from the U.S. government.
Manchin has stressed the bill’s promotion of natural gas domestically, helping the U.S. gain some independence from reliance on fossil fuels from overseas.
The bill will include things like $80 billion in rebates for green energy and electric vehicles, $1.5 billion in incentives for slashing methane emissions and $27 billion for what’s called the Clean Energy and Sustainability Accelerator — a “green bank” for environmentally friendly technology. And biggest of all, a whopping $260 billion in clean energy tax credits to incentivize investment in renewable sources.
Democrats had hoped to repeal the Republicans’ 2017 tax law, including the corporate and individual income tax cuts promoted by former President Donald Trump. Sinema appeared to be the holdout there so those laws aren’t going anywhere. But paying the bill will rely on raising taxes, primarily on large corporations.
“This would certainly be the biggest corporate tax increase in decades,” Steve Wamhoff, a tax expert at Institute on Taxation and Economic Policy, told the Washington Post. “We’ve had decades of tax policy benefiting the rich, but this is really the first attempt to raise revenue in a progressive way that would begin to combat wealth and income inequality.”
Many Democrats are going to be disappointed that many prized policies — like housing, child care and paid leave programs — didn’t make the cut. But it’s still a big deal, and seems like it will put at least a little wind in the sails of Biden’s re-election hopes.
The politics of it are understandably toxic and messy. But the hope here is that this bill’s passing will make green energy more financially viable than fossil fuels.
