The Senate was horrified and vowed to act. Then,in the face of concerted lobbying and a geyser of donations by fossil fuel interests,the body sometimes referred to in the US as “the world’s greatest deliberative body” achieved nothing until Sunday afternoon (Monday AEST),when it passed a sweeping climate,tax and healthcare bill.
Senate Majority Leader Chuck Schumer:“It’s been a long,tough and winding road,but at last,at last we have arrived.”Bloomberg
The package,which was conceived by President Joe Biden as the Build Back Better Bill but born as the Inflation Reduction Act,is now likely to breeze through the House of Representatives by the end of the week.
It has been welcomed by climate activists as an historic moment,the first time in which the US Congress has acted as an accelerant for climate action rather than a brake.
The climate provisions alone will see $US370 billion ($534.15 billion) spent on incentives for homeowners to electrify their homes and buy EVs,and industry to invest in clean energy.
It will raise revenue by hiking taxes on large companies,increasing funding for the Internal Revenue Service that has been starved of funds for a generation,and reducing the amount the government pays the private sector for medicine.
help the US reduce emissions by 40 per cent from their 2005 high,reducing emissions by the equivalent of nearly one billion tonnes of carbon dioxide per year by 2030.
Chuck Schumer,the Democratic Senate Majority leader who championed the bill which most believed was dead just weeks ago, it was the “the most comprehensive piece of legislation affecting the American people in decades”.
“It’s been a long time coming,but the Senate has finally advanced transformative climate legislation,” said former US vice president Al Gore,who won a Nobel Prize for his work communicating on climate change.
It comes as the new Australian government looks set to pass its own legislation enshrining a 43 per cent emission reduction target.
In purpose,ambition,scale and potential impact,the two pieces of legislation are incomparable,but there are important parallels between them.
Both are the work of governments that are at once inclined towards climate action but cautious of it. As a result,both have abandoned efforts to introduce an emissions tax,widely regarded as the most efficient way to secure economy-wide greenhouse gas reductions.
Having surrendered on a carbon price,policy-makers in Australia and the US are now reaching for other levers to reduce emissions,says the Australian National University environmental economist Professor Frank Jotzo.
The pragmatic policies they are pursing instead are built to achieve multiple policy goals. The Biden government’s package serves also to ramp up some corporate taxes,rebuild decayed public infrastructure and even cut some pharmaceutical costs.
The Labor government’s plan includes $20 billion in spending on Australia’s electricity transmission system,a system that desperately needs the upgrade irrespective of climate change.
Jotzo notes that this trend away from making emissions the singular focus of climate policy reflects a global trend endorsed by the United Nation’s climate body the IPCC,which recognises that successful climate policies now serve multiple policy objectives - environmental,economic and social.
That said,on climate grounds alone,the success of the Democrats in securing the passage of a vast and complicated bill through a senate held by the narrowest possible margin is,as Biden once said of Obamacare,“a big f---ing deal.”
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