From the Daily Caller
Bonner Cohen
Author, Repairing America's Crumble Underground Infrastructure
Vice President Kamala Harris vowed to “pass a middle-class tax cut that will benefit more than 100 million Americans” during her speech at the Democratic National Convention on Thursday night. In fact, while serving as vice president, Harris played a key role in crafting legislation that increased the cost of living for all Americans.
When President Joe Biden signed the Inflation Reduction Act (IRA) on August 16, 2022, he said it was “one of the most important laws in our history.”
This is no exaggeration.
Contrary to its label, the law has nothing to do with reducing inflation. In fact, it can quickly drive up the price of essential goods such as food, electricity and transportation. The IRA is the government's signature energy transition initiative and includes provisions that strengthen the government's role in health care and increase IRS staff numbers. The Senate was deadlocked 50-50, with Harris casting the deciding vote that ultimately passed. (Related: The good, the bad and the ugly: Biden’s climate bill turns two)
IRA supporters sold it to the American public for $750 billion as a tool to combat the “climate crisis”. But by April 2023, Goldman Sachs calculated that the regulation's subsidies and other grants would cost $1.2 trillion over ten years. In fact, the cost of the IRA cannot be measured in dollars and cents because the law’s impact on the lives of ordinary citizens, the viability of the U.S. economy, and U.S. national security is so profound that it cannot be quantified.
At its core, the IRA was about delivering massive handouts, paid for by taxpayers, to politically favored industries and organizations, most of whom would see their quality of life decline as the law tightened its grip on the nation's energy industry. For example, the law expanded subsidies for notoriously inefficient offshore wind turbines amid a push to transition the country away from fossil fuels, at a time when several offshore wind projects along the Atlantic seaboard were high-profile due to rising costs and pushback from the Atlantic coast. Cancel.
The IRA rigged the game against gasoline-powered vehicles, extending the $7,500 tax credit for new electric vehicle (EV) purchases to include point-of-sale discounts if the EV and its batteries are assembled in the United States and the mineral batteries The raw materials come from the United States or countries with free trade agreements.
Yet despite the IRA's preferential treatment for electric vehicles, sales of these cars have stalled, an ominous sign for U.S. autoworkers who are transitioning to making cars that the driving public continues to shy away from and whose Assembly work already requires less labor. Electric vehicles currently account for 6.8% of new sales, meaning more than 93% of buyers still choose gasoline-powered vehicles. However, people who buy conventional cars still pay federal taxes to subsidize the sale of electric vehicles.
America’s already crumbling power grid would also be at the ruthless mercy of the IRA. In a January 2023 update in a publication titled “Building a Clean Energy Economy: A Guide to Clean Energy and Climate Action Investments under the Inflation Reduction Act,” the White House boasted that the IRA has “invested nearly 30 million dollars in the U.S. transmission system. These investments will not only address critical vulnerabilities, but will also advance the Biden-Harris Administration’s path to cleaner, more affordable power by 2035. Ambitious goal of 100% carbon-free electricity.
But therein lies the rub. The energy sources favored by the IRA – wind and solar – are neither clean nor cheap nor reliable at all. End-of-life wind turbines and solar panels filled with toxic chemicals will be shipped to landfills across the country, turning each dump into a potential mini-Superfund site. They are “cheap” only because they are supported by taxpayers, and even with subsidies, wind and solar cannot compete with natural gas, which is at its lowest prices in years.
Providing steady intermittent power to the grid only increases its vulnerability. In a joint letter to Congress on Aug. 16, 55 free-market and conservative groups urged lawmakers to eliminate IRA subsidies, citing the law's threat to the electric grid.
“The very threats to grid reliability warned about by entities like PJM and the North American Electric Reliability Corporation are exactly what this regulation actively encourages,” the coalition wrote. “Thanks to the IRA, the American people face a greater likelihood of blackouts in the future — —and being forced to pay for that privilege.” (Related: Diana Fuchgot-Ross: Two years later, it’s clear Biden’s inflation-cutting bill does the exact opposite)
Recipients of IRA giveaways may temporarily benefit from the energy chaos that the IRA and like-minded “climate-friendly” Biden administration regulations will bring to the country. But the real beneficiary of the law is Beijing. China can only marvel at how the United States has unilaterally disarmed itself, abandoning global leadership in fossil fuel production in favor of energy sources controlled by Beijing. China controls global supply chains for cobalt, lithium, graphite, nickel, copper and rare earth elements that are at the heart of the energy transition the IRA aims to drive.
Decades before the IRA, the economist Friedrich Hayek captured the spirit of the “fatal conceit” of central planners who showed “that they knew little about their imagined design capabilities.” Very few.”
Dr. Bonner Russell Cohen is a senior policy analyst at the Committee for a Constructive Tomorrow (CFACT).
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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