The Biden administration, to its credit, never misses a chance to emphasize the importance of dealing with climate change. President Joe Biden calls it an “existential” threat to humanity. John Kerry, his special envoy on the issue, said in April: “That means life and death. And the question is, are we behaving as if it is? And the answer is no.”
That was certainly true under former President Donald Trump, who championed coal, abandoned the 2015 Paris agreement on climate and dismissed global warming as a hoax. Biden has brought a badly needed shift on policy. But his policies sometimes are at war with his rhetoric.
One crucial part of his agenda is speeding the transition from gasoline-powered vehicles to electric ones. Cars and light trucks account for 16% of all U.S. greenhouse gas emissions, and Biden wants half of all autos sold in this country to be electric or plug-in hybrids by 2030. That transition would significantly reduce carbon output.
But let’s not get the idea that the administration is laser-focused on whatever it takes to curb climate change. Its enthusiasm for electric vehicles, it turns out, is not unlimited. In Biden’s eyes, some electric vehicles are good and some are bad, and the difference has nothing to do with greenhouse gases.
The social spending and climate package recently approved by the House of Representatives would encourage Americans to buy electric vehicles by providing a tax credit of as much as $12,500 for each purchase, an increase over the existing $7,500 credit. That indirect subsidy is needed because these cars generally cost more to purchase than comparable conventional cars.
But Biden and his congressional allies are not enamored of all electric vehicles. They want to restrict the full tax break to those cars that are built by union workers in the United States and have batteries built by union workers in the United States. Buyers of other vehicles would get only a $7,500 credit — a $5,000 penalty.
That penalty would apply to almost all of the 50 electric vehicles currently sold here, including every model made by Tesla, the Ford Mustang Mach-E, the Nissan Leaf, the Rivian pickup, the Hyundai Ioniq and more. The only exceptions are two Chevy Bolt models. It would also harm workers in U.S. plants operated by foreign automakers, which are nonunion and produce nearly half of all the vehicles sold here.
The discrimination is a giant favor to the United Auto Workers, a stalwart of the Democratic Party that has been weathering a major corruption scandal. “The union has stressed to the Biden administration that the country shouldn’t sacrifice union jobs to meet its climate goals,” reported The Wall Street Journal. A White House spokesman insisted that “jobs taking on the climate crisis must also be jobs that build the middle class.”
There are some obvious flaws in the administration’s logic. One is that given the monumental size of the battle against climate change, it is imperative to enlist every automaker, including nonunion ones.
To exclude nearly all electric cars from the full tax credit will make the national transition away from gas-powered vehicles — a hugely formidable undertaking under the best of circumstances — slower and more expensive. It’s exactly the wrong strategy if you place a supreme priority on saving the planet from excessively high temperatures.
The UAW has repeatedly lost elections allowing workers at foreign-owned plants to decide whether to sign up with the union. Limiting the tax credit will hurt those workers. It will also encourage automakers to build electric cars abroad, where they can achieve lower labor costs — enough, perhaps, to overcome the tax disadvantage.
It will also be a boon to the internal combustion engine. As Jeffrey Schott, a senior fellow at the Peterson Institute for International Economics, told me, “If you raise the cost of electric vehicles too much, people will buy gas-powered cars.”
The Trump administration refused to require any sacrifice from fossil fuel companies and their employees merely to avert the worst-case climate scenario. The Biden administration is willing to act against climate change, but it too insists on protecting certain groups at the expense of the broad American public — and all humanity.
Denying the full tax credit to the vast majority of electric vehicles will mean more carbon emissions and warming of the planet. But hey — it’s not like this is a matter of life and death, right?
