In his bombshell statement yesterday, Senator Joe Manchin listed several reasons why he purportedly cannot support the Build Back Better (BBB) budget reconciliation package. Manchin’s primary concerns do not apply to the climate provisions in the bill, and can be overcome through re-negotiating and restructuring. The reservations he expressed regarding clean energy spending are inaccurate.
Congressional Democrats initially proposed a BBB package that included $3.5 trillion in investments, with plans to pay for the whole bill so as not to add to the national debt. Senator Manchin made clear that he would not vote in favor of a package more than half that size. This left congressional Democrats with two options: remove a number of provisions entirely, or scale them back by funding many policies for a shorter timeframe than the usual 10-year window.
Members of Congress were divided on this question. Many progressives favored the latter option, and won out in the previous BBB negotiations. Senator Manchin has long expressed his concern that this short-term funding approach is a “gimmick” because, hypothetically, future congresses could extend the programs’ funding without paying for those extensions, thus adding to the debt (although as a member of the Senate, Manchin would have an influential voice and vote on such extensions).
The good news is that this objection can be overcome by revising BBB to only include policies that are fully paid for over the 10-year window. The even better news is that the climate provisions in the package are already fully paid for.
Senator Manchin also expressed concern about inflation; however, a veritable parade of economists have said that BBB will not worsen inflationary pressures, and 17 Nobel Prize winners argued, “Because this agenda invests in long-term economic capacity and will enhance the ability of more Americans to participate productively in the economy, it will ease longer-term inflationary pressures.” Moreover, in the wake of Senator Manchin’s announcement, economists from Goldman Sachs and Moody’s Analytics downgraded their forecasts of US economic and employment growth over the next year, indicating that BBB would benefit the US economy.
It’s also worth noting that a price on carbon pollution could generate even more revenue without adding to inflation, were one added to BBB.
Senator Manchin also expressed concern that “the bill will also risk the reliability of our electric grid and increase our dependence on foreign supply chains.” These worries are unfounded. As supporting examples, Manchin referenced power outages in California and Texas, which were caused by extreme weather events. In Texas in particular, last winter’s outages were largely caused by frozen fossil fuel supplies and an isolated power grid. California’s very limited blackouts (affecting only about 2% of state residents, for between a few minutes and 2 ½ hours) in the summer of 2020 were largely caused by poor grid operator planning during an intense heatwave.
Limiting the frequency at which such infrastructure-straining extreme weather events strike in the future will require curbing climate change. That’s precisely what the climate investments in BBB aim to do. Without BBB, US greenhouse gas emissions are projected to fall about halfway short of the Biden administration’s strengthened Paris pledge to cut American emissions 50–52% below 2005 levels by 2030. In fact, we would not even be on track to meet the Obama administration’s initial Paris pledge to cut emissions 26–28% below 2005 levels by 2025. Although as Senator Manchin noted, “The energy transition my colleagues seek is already well underway,” it’s progressing far too slowly to avert dangerous climate change.
The BBB climate investments are critically important for curbing climate change and thus strengthening the reliability of the US power grid. Likewise, accelerating away from fossil fuels and toward domestic clean energy sources like wind and solar will reduce our dependence on foreign supply chains.
Fortunately, Senator Manchin’s BBB counteroffer last week reportedly retained much of the package’s climate investments. The White House and Senate Democrats may use this outline to re-engage negotiations with Senator Manchin. It would benefit the economy, the climate, public health, and domestic energy security if those efforts prove successful.
Posted by dana1981 on Tuesday, 21 December, 2021
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