After innumerable stops and starts, Senators Joe Manchin (D-WV) and Chuck Schumer (D-NY) finally agreed on a legislative package, now called the “Inflation Reduction Act of 2022,” that would lower prescription drug costs, extend health insurance subsidies, and reduce carbon emissions. The bill, according to its proponents, would also reduce the federal deficit by $300 billion.
The climate provisions, while scaled back from what Democrats initially envisioned, are historic. The bill includes $369 billion in climate spending which “would represent the single biggest climate investment in U.S. history, by far.”
The climate provisions of the bill target the sectors of the economy that are the most carbon-intensive: transportation and electricity generation. For transportation, the bill provides tax credits to incentivize Americans to buy clean cars — up to $4,000 for a used vehicle and $7,500 for a new vehicle — through 2032. There are also billions in incentives to construct new manufacturing facilities (or retrofit older facilities) to produce zero–emissions vehicles in the United States. On electricity generation, the bill would provide “$30 billion in targeted grant and loan programs for states and electric utilities to accelerate the transition to clean electricity” and fund a “$27 billion clean energy technology accelerator to support deployment of technologies to reduce emissions.”
These and other provisions would put the United States on a path to reduce carbon emissions by 40% below 2005 levels by 2030. That’s not quite enough to avoid the worst impacts of global warming. (The administration had been targeting a 50% reduction in previous iterations of the package.) But it’s a giant step in the right direction.
This legislation would provide critical support to car manufacturers like General Motors (GM), which has pledged to “completely phase out vehicles using internal combustion engines” and only produce electric vehicles by 2035. In November 2021, GM told Popular Information that it “supported the goals” of a more ambitious version of the bill. Specifically, GM said it “supports economy-wide efforts to address climate change including a drive toward an all-electric future that strengthens American jobs and enhances the well-being of American consumers.”
But GM did not respond to a request for comment about its position on the Inflation Reduction Act of 2022. Meanwhile, GM CEO Mary Barra is leading an effort to defeat the legislation.
In January 2022, Barra became the Chair of the Business Roundtable, a corporate lobbying group representing hundreds of America’s top CEOs. The Business Roundtable claims it is committed to addressing climate change. On its website, the Business Roundtable says it believes “corporations should lead by example [and] support sound public policies… needed to address climate change.” The group acknowledged the imperative of reducing carbon emissions by 45% by 2030 — an even more aggressive reduction than is contemplated by the latest agreement.
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