Biden’s State of the Union Address Adheres to his Climate Agenda

by | Mar 4, 2022 | POLITICS

President Biden touted his climate agenda in his state of the union address despite the rising price of oil and natural gas, which has helped to spur the worst inflation in the United States in many years.

In President Biden’s March 1, 2022, State of the Union address, he continued to push for top-down, centrally controlled energy policies designed to fulfill his personal pledges on behalf of Americans to adhere to his United Nations climate commitments. Although it is not a Constitutional Treaty, he is treating it as though it was through his actions.

While the United States still gets 60 percent of its electricity from coal, natural gas and oil, Biden is pushing electric vehicles that the American public can’t afford and do not want and will only increase the demand for electricity that wind and solar cannot satisfy. Further, only wealthy Americans can afford the premium for electric cars that results from costly batteries whose supply chain China dominates, decreasing U.S. national security instead of improving it as supporters argue. In his address to the nation, Biden praised Ford and GM for devoting a combined $18 billion toward making electric vehicles in the United States. What he didn’t say is his climate policies are forcing them to do it or that there are significant costs to consumers. He touted his failed Build Back Better bill that contains lucrative tax credits for electric vehicles, saying “Lower the price of electric vehicles, saving another $80 a month that you’re not going to have to pay at the pump.”

The entire point of Biden’s climate agenda is to raise the price of energy for Americans by reducing the supply and increasing the cost of coal, oil and natural gas, which he thinks will push Americans to electric vehicles and other technologies that fulfill his climate agenda. So far, his plan to increase prices is working, as oil prices broke through $110 the day after his speech.

Biden took credit for the country’s economic recovery from the coronavirus lockdowns. But, despite the American manufacturing sector adding 400,000 workers in the past year, jobs in the sector, which accounts for around 8 percent of the workforce, are still down from pre-pandemic levels. Adam Posen, the president of the Peterson Institute of International Economics, tweeted that Biden should not feed lies to deluded voters by pandering to macho manufacturing fetishes and ignoring the majority of workers outside heavy industry. Biden also infuriated Tesla’s Elon Musk, who after the speech tweeted that Tesla had created 50,000 U.S. jobs and invested more in electric-vehicle technology than GM and Ford combined.

But, Biden’s focus has been on automakers with unionized workforces—not Tesla, which is not unionized, but has built and sold more electric vehicles in the United States than any other auto company.

That was not the first time that Biden bypassed Tesla’s achievements. Biden did not invite Musk to participate in a meeting with automakers at the White House and falsely stated that GM leads the electric car industry, when in fact Tesla produced over 300,000 electric vehicles last quarter and GM produced 26. General Motors reported U.S. sales of 26 electric vehicles, including one Hummer pickup and 25 Bolt EV models during the fourth quarter. And, GM recently announced it was extending its production halt of their Chevrolet Bolt EV until early April. In 2021, Tesla delivered nearly a million cars, a 90 percent increase from 2020.

Tesla was able to capitalize on the industry by its early entrance and by earning zero-emission vehicle credits, largely from a program in California where automakers not reaching their quota had to purchase credits from an automaker that had exceeded its quota. Because Tesla only produced electric vehicles, which are considered zero-emission vehicles because the government ignores how cars are manufactured and how electricity is currently produced, it had credits to sell and was able to use those revenues to continue its production and sales of Tesla vehicles.

Biden’s plan is to make half of new car sales in 2030 electric – up from 4.5 percent last quarter. But, electric vehicles today cost an average of $55,000, versus regular cars at $35,000. President Biden’s goal for the United States to be 50-percent electric by 2030 proposes in Build Back Better to extend and enlarge the electric vehicle tax credit from $7,500 to $12,500 per vehicle with part of the increase given if buying union-manufactured vehicles. In addition, automakers are all but forced to sell electric vehicles in order to get credit toward Biden’s stringent corporate average-fuel-economy standards. Biden is essentially dragooning automakers into manufacturing electric vehicles.

Biden’s manufacturing push for electric vehicles ignores that fewer manufacturing jobs are created to make electric vehicles than internal combustion engine vehicles because they have fewer components. Makers of mufflers, fuel injection systems and other parts could go out of business, leaving many workers jobless. Nearly three million Americans make, sell and service cars and auto parts. It also ignores that prices for battery materials like lithium, nickel and cobalt are already skyrocketing, which could limit electric vehicle sales in the short term by driving up the cost of electric cars. Further, China dominates the supply chain for electric vehicle batteries, moving the United States from being 23 percent dependent on the Middle East for imported oil in 2001 to being 80 percent dependent on China if Biden accomplishes his climate agenda.

The transition could also be limited by the lack of places to plug-in electric cars, which has made the vehicles less appealing to people who drive long distances or apartment residents or street-parking people who cannot charge at home. There are fewer than 50,000 public charging stations in the United States. The infrastructure bill that Congress passed in November includes $7.5 billion for 500,000 new chargers, but that number is too small to make a major difference. Another issue is the exorbitant times for recharging electric vehicle batteries, which reduces the effective use of electric vehicles to local driving. The long charging times means more charging stations will be required to be sited and built than existing service stations. For example, a fuel pump that can service 8 vehicles in 40 minutes at 5 minutes each for a fill-up would require 8 charging points to handle the same volume for electric vehicles that might take 40 minutes for a fast charge giving substantial range.

Battery fires have also plagued the industry. GM has had to recall all of its 141,000 Bolts going back to the 2017 model, which is expected to cost the company $1.8 billion because of battery fires. More recently, a ship carrying luxury cars from Europe to the United States was set aflame with a lithium-ion battery fire that cannot be put out with water alone. The ship, the Felicity Ace, was carrying about 4,000 vehicles, including Bentleys and Porsches, when it caught fire on February 16. On March 1, it sank.

Conclusion

President Biden touted his climate agenda in his state of the union address despite the rising price of oil and natural gas, which has helped to spur the worst inflation in the United States in many years. As part of his speech, he praised U.S. auto manufacturers for aligning with his electric vehicle program and goal of making 50 percent of auto sales in 2030 be electric vehicles. He also tried to push his Build Back Better program with its enormous tax incentives for electric vehicles and “green” technologies. But, he fails to recognize that Americans have other priorities that his anti-oil and gas policies have created by making it harder to make ends meet in Biden’s America.

Made available by IER.

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The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.

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