Thursday, March 28, 2024

Woke ‘Capitalism’ Betrays True Cost Of Inflation Reduction Act

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While we're on the topic of – or, as so devastatingly called it, “legal plunder” – it turns out the ill-named which larder subsides on the green energy sector, may cost hundreds of billions of dollars more than previously thought.

Yes, hundreds of billions of dollars more. The original cost estimate: roughly $391 billion over 10 years. The real figure could be $1.2 trillion.

Even by the magical thinking that substitutes for budgeting in official Washington, this is a whopper of a miscalculation. How did it happen? The Wall Street Journal points to a Goldman Sachs research note that exposes a costly flaw in the IRA's wording:

By Goldman's estimate, the IRA tax credits will cost tens to hundreds of billions more than CBO estimated over 10 years. The forecast misses include electric vehicles (difference: $379 billion), green energy manufacturing ($156 billion), renewable electricity production ($82 billion), energy efficiency ($42 billion), hydrogen ($36 billion), biofuels ($34 billion) and carbon capture ($31 billion).

Goldman says the difference in the EV credit estimates owes to its projection that more vehicles will meet the law's “self-sufficiency” mineral and battery material conditions for the partial $3,750 consumer credit and full $7,500 credit. But even Goldman's estimate for the EV credit could be low if Treasury loosely interprets the credit conditions, which is what auto makers are lobbying for.

Goldman Sachs doesn't necessarily oppose the higher spending. The Journal's editorial board says the whole thing could lead to “an enormous new corporate entitlement whose costs will increase on autopilot…”

That would make it like almost every other entitlement program on the books today – politically costly to reform and politically suicidal for those who try to end it.

If there is any bright side to this orgy of legal plunder, it's how the corporations thirsting after the subsidies have put “paid” to the notion that they are somehow great defenders of free enterprise and free markets. A few still are. But they are an increasingly vanishing breed.

And good day, Tim Cook. How nice to see your statement about the relationship between Apple and China:

“Apple and China… grew together and so this has been a symbiotic kind of relationship that we have both enjoyed. I am thrilled to be back in China. It means the world to me and I feel really privileged to be here.”

Nothing to see here. Move along….

The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.

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Norman Leahy
Norman Leahy
Norman Leahy has written about national and Virginia politics for more than 30 years with outlets ranging from The Washington Post to BearingDrift.com. A consulting writer, editor, recovering think tank executive and campaign operative, Norman lives in Virginia.

2 COMMENTS

  1. Is there anything the Government can’t screw up? Why aren’t “Sunset Clauses” put on these subsidy Bills? They are to serve one purpose, but they become permanent. We can’t afford to have more welfare programs on the books and none of the “Representatives” have the guts to try to stop any of them.

  2. The days of Abraham Lincoln are GONE. In other words, no poor man will ever become President again. Only the rich can afford all the techniques of mass manipulation (media ads, propaganda distribution, etc.). The politicians we elect are therefore experts at making a buck and they know all the tricks. The only remaining question is: how many of them are ETHICAL capitalists? I know this applies mostly to Republicans, for the DemoCreeps are largely radicalized socialist goons who are determined to climb aboard the gravy train by fleecing John Q. Public.

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