Inflation Reduction Act Quotes

They also needed a name: Manchin toyed with calling it the Energy Security Act. Together they dubbed it the Inflation Reduction Act. The moniker didn’t really capture the contents of the bill, or its grandeur. But the tax credits and health care provisions would make life cheaper. That might be a touch disingenuous, and it certainly wasn’t a title that would echo through the ages, but it had the feel of good politics. —

During Biden’s long period of flailing, I had feared that he had missed his chance to avert the worst consequence of climate change—and that another opportunity to protect the planet wouldn’t come around for years, after it was far too late. But then in the summer of 2022, Congress passed the Inflation Reduction Act, a banally named bill that will transform American life. Its investments in alternative energy will ignite the growth of industries that will wean the economy from its dependence on fossil fuels. That achievement was of a piece with the new economics that his presidency had begun to enshrine. Where the past generation of Democratic presidents was deferential to markets, reluctant to challenge monopoly, indifferent to unions, and generally encouraging of globalization, Biden went in a different direction. Through a series of bills—not just his investments in alternative energy, but also the CHIPS Act and his infrastructure bill—he erected a state that will function as an investment bank, spending money to catalyze favored industries to realize his vision, where the United States controls the commanding heights of the economy of the future. The critique of gerontocracy is that once politicians become senior citizens, they will only focus on the short term, because they will only inhabit the short term. But Biden, the oldest president in history, pushed for spending money on projects that might not come to fruition in his lifetime. His theory of the case—that democracy will succeed only if it delivers for its citizens—compelled him to push for expenditures on unglamorous but essential items such as electric vehicle charging systems, crumbling ports, and semiconductor plants, which will decarbonize the economy, employ the next generation of workers, and prevent national decline.

failed to create an arm of the government that will be forever attached to his name, nothing like Obamacare or remotely resembling social security. But the thrust of the Inflation Reduction Act can still be described as transformational—and it will change American life. The theory of the legislation is that the world is poised for a momentous shift. For a generation, the economy has taken tentative steps away from its reliance on fossil fuels. New technologies emerged that lowered the costs of solar panels and wind turbines and batteries; the mass market showed genuine interest in electric vehicles and heat pumps. But the pace of adaptation was slow, painfully slow given the looming changes to the climate. On its own, the economy was never going to evolve in time to avert the worst consequences

of climate change. What was needed was a massive nudge in the right direction. In the past, the stick of regulation and the rod of taxation were the methods that environmentalists believed could break the fossil fuel economy. But the Inflation Reduction Act doesn’t rely on such punitive tactics, because Manchin culled them from the bill. Instead, it imagined that the United States could become the global leader of a booming climate economy, if the government provided tax credits and subsidies, a lucrative set of incentives. There was a cost associated with the bill. By the Congressional Budget Office’s score, it offered $386 billion in tax credits to encourage the production of wind turbines, solar panels, geothermal plants, and battery storage. Tax credits would reduce the cost of electric vehicles so that they would become the car of choice for Middle America. But $386 billion was an estimate, not a price tag, since the legislation didn’t cap the amount of money available in tax credits. If utilities wanted to build more wind turbines or if demand for electric vehicles surged, the government would keep spending. When Credit Suisse studied the program, it estimated that so many businesses and consumers will avail themselves of the tax credits that the government could spend nearly $800 billion. If Credit Suisse is correct, then the tax credits will unleash $1.7 trillion in private sector spending on green technologies. Within six years, solar and wind energy produced by the US will be the cheapest in the world. Alternative energies will cross a threshold: it will become financially irresponsible not to use them. Even though Joe Biden played a negligible role in the final negotiations, the Inflation Reduction Act exudes his preferences. He romanticizes the idea of factories building stuff. It is a vision of the Goliath of American manufacturing, seemingly moribund, sprung back to life. At the same time that the legislation helps to stall climate change, it allows the United States to dominate the industries of the future. This was a bill that, in the end, climate activists and a broad swath of industry could love. Indeed, strikingly few business lobbies, other than finance and pharma, tried to stymie the bill in its final stages. It was a far cry from the death struggles over energy legislation in the Clinton and Obama administrations, when industry scuppered transformational legislation. The Inflation Reduction Act will allow the United States to prevent its own decline. And not just economic decline. Without such a meaningful program, the United States would have had no standing to prod other countries to respond more aggressively to climate change. It would have been a marginal player in shaping the response to the planet’s greatest challenge. The bill was an investment in moral authority.