📰 "Did Joe Manchin just Save the Planet?"

Podcast’s Essential Bites:

[1:40] SR: "Who can blame you if you are caught off guard by West Virginia Senator Joe Manchin's potentially historic compromise with the rest of the Democrats? He, after all, was famously not into Build Back Better. [...] But now it's a yes."

[1:57] LZ: "What we know is that Manchin has been talking to economic experts, including Larry Summers, who's a notorious inflation hawk, who has reassured him that actually these investments are not going to add to inflation, and that's something that potentially contributed to his decision. [...] Additionally, there's an interesting timing element, where previously Senate Minority Leader Mitch McConnell had threatened to hold this other bill hostage if Democrats moved forward with budget reconciliation. [...] That bill, which was an investment in semiconductors known as the CHIPS Act, passed last week. [...] A couple hours after it passed, Manchin announced this agreement. So there's some speculation that McConnell lost his leverage and then Democrats decided to move forward."

[3:28] LZ: "We're spending $433 billion. [...] And then revenue wise, the bill is expected to bring in $739 billion dollars. That amounts to $300 billion more in revenue than in spending and that funding is going to be used to pay down the deficit. [...] [There are] three big sections of this package: we have health care, taxes, and climate."

[7:33] LZ: "[Joe Manchin] was down to do pretty significant investments in climate. It's about $369 billion total that they're going to be putting into tax credits to incentivize manufacturing of clean energy, to incentivize people to drive electric vehicles, to invest in clean energy for their homes, and to also address the impact of pollution in different places and help provide grants for communities that have historically faced consequences from different infrastructure projects."

[15:45] RL: "If this [bill] actually passes, this is the biggest amount the US has ever spent to combat climate change. [...] If this bill works as it's intended, it will basically push Americans away from relying on fossil fuels in all parts of the economy."

[16:51] RL: "This helps clean up the car industry by providing tax credits for new and used electric vehicles. The idea is bringing down the cost for electric vehicles for everyone. So this more targets the lower and middle income brackets to help make cars more affordable. So that's why I think the tax credits for used electric vehicles is particularly interesting here."

[17:41] RL: "This is basically Biden's campaign promises to enhance US jobs and manufacturing. So there are credits for manufacturers to produce electric cars. There's also some stipulations in the electric vehicle tax credits section that more parts of the car have to be produced in the US and those actually ratchet up over time. So ideally, over the next decade, you see more cars being put together, parts being produced in the US."

[18:46] RL: "The power sector is a really important piece of this puzzle. Because as we have more electric cars, as we replace appliances in people's homes with electric appliances, that's going to be plugging into a grid. So we're only as clean as the grid is."

[19:54] RL: "The other thing it does that is really big is it tackles methane emissions from the oil and gas sector. So there is a methane fee and fines for oil and gas operators that are basically leaking this very powerful greenhouse gas throughout its supply chain. So this is the first industry wide kind of fee that tries to bring down this really polluting greenhouse gas. Compared to CO2, methane pollutes up to 86 times more over a 20 year period."

[21:33] RL: "There's also the first National Green Bank. We have green banks throughout the country, some states and cities have created these. But at the federal level, this is a quasi public private bank that has a social mission, which is to boost clean energy. They are expecting a return on their investments. This isn't just a government grant, but. The idea is to boost spending in all kinds of clean energy sectors. And one thing I think this does, that is unique to what a National Green Bank could do as opposed to the private sector, is it dedicates a portion of those funds to low income communities."

[24:19] RL: "There have been a bunch of different analyzes from economic modelers looking at what the benefits this bill delivers versus the costs. And they've been unequivocal that this far outweighs what those fossil fuel projects do, that the climate benefits are considerable. Overall, the several different analyzes from groups [...] are saying that this bill delivers about 40% in emissions cuts by 2030. That is a much bigger number than where we were at without it."

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