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For the climate, 'Build Back Better' better pass

From the column: "We are now down to a mere eight years to cut greenhouse-gas emissions by 50%. We need the Build Back Better bill."

Eric Enberg.jpg
Eric Enberg

You have probably heard that President Joe Biden’s signature bill, the Build Back Better bill, is in serious jeopardy because of opposition to parts of it by Sen. Joe Manchin of West Virginia.

There are many parts to the bill, but you need to know just how much economic skin you have in this game if its climate provisions don’t pass.

For instance, say you want to purchase an electric vehicle. You might have noticed that a Tesla is synonymous with “very cool, very pricey.” Part of this is a business model whereby Tesla first produced high-end vehicles, which financed medium-priced models, which in turn will finally allow for vehicles for the everyman. However, the tax code also played an important role.

Current tax law gives a $7,500 tax credit for the purchase of an electric vehicle until the manufacturer hits a ceiling of cars sold, after which the credit is phased out. Several manufacturers have hit this limit. Additionally, most people with less than $60,000 in income don’t have enough tax liability to take advantage of the credit. This makes owning an electric vehicle very difficult for low- and middle-income people and helps to explain why auto manufacturers view electric vehicles as premium products with prices to match. In fact, almost all the benefits of the current program have been used by the wealthiest 20% of households.

These shortcomings were noted by U.S. Senate and U.S. House Democrats (sadly, no Republicans) when crafting the Build Back Better bill. If it passes, you will be able to slash the cost of a new or used electric vehicle by signing over the $7,500 credit directly to the dealer at the point of sale, instead of financing it and waiting until the following year for a refund. There is also a push to increase the credit to $12,500 if the electric vehicle was made with American union labor, though this provision is controversial. Either way, the credit will no longer be dependent on your tax liability and will dramatically drop the price of an electric vehicle vs. a fossil-fueled vehicle. It will create a strong market for reasonably priced electric vehicles and will catapult their sales.

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Besides, who wants to plaintively sacrifice a $3 million electric Bugatti to MnDOT’s Great Winter Salt God anyway? The test drive would be mind blowing, though.

Similar tax-credit provisions cover home and commercial solar and heat pumps for home and business heating. The net effect of these policies for rural and urban low- and middle-income families is staggeringly positive. It will help these families produce their own electricity, heat their homes with that electricity, and, likewise, power their transportation needs.

Additionally, by making clean energy and the mechanisms that use it less expensive, the Build Back Better bill allows for aggressive regulation at the federal level that will require industry to build these products. This synergistic effect occurs because federal regulations have to show that they will not cause economic harm. By literally dropping the price of clean-energy technology, the federal government allows regulators to go further and faster than they otherwise would have been able to.

We are now down to a mere eight years to cut greenhouse-gas emissions by 50%. We need the Build Back Better bill. Please call your U.S. Sens. Amy Klobuchar (202-224-3244) and Tina Smith (202-224-5641) and ask them to strongly support the bill.

Dr. Eric Enberg practices family medicine in West Duluth and is group leader for the Duluth Citizens' Climate Lobby. He also is a member of the Duluth Climate and Environment Network.

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