The Washington Post mentions “Skylar Holden, a cattle farmer in eastern Missouri,” who is not receiving $240,000 in federal funding that he was awarded under the Environmental Quality Incentives Program because Trump froze it. The headline is: “Farmers [are] on the hook for millions after Trump freezes USDA funds,” In The New York Times, Michael W. Webber describes the broader pattern: “Mr. Trump’s G.O.P. rank and file might not let him choke off the money flowing to Republican districts; a majority of federal clean energy investments for wind, solar, batteries and clean tech factories are going to those regions.”

This was the design; the policy was built to survive political opposition. I believe the authors of the the $739 billion Inflation Reduction Act and related bills (provisions in the $1.9 trillion American Rescue Plan and the $280+ billion CHIPS Act) held the mental model shown on the right side of the image that accompanies this post.

You could read the image by focusing first on the teal loop. By burning carbon, people cause both good and bad outcomes. The net result is bad; probably around $185 of damage per tonne of carbon dioxide emissions (Rennert et al 2022), which I think comes to about $6.8 trillion per year for the world.

Governmental policies could reduce that social cost. A big carbon tax is an example. However, virtually no governments do enough. The reason is that carbon produces a set of interest groups–some environmental ones, but many stronger groups that are committed to cheap carbon. Not all of these groups are elite. They include working people in carbon-intensive jobs and their elected representatives. The carbon economy also generates public opinion, including concerns about climate change as well as deep support for carbon-intensive jobs and products. The interest groups and public opinion influence governments to adopt the policies that they enact. For the most part, it is a vicious circle.

To create an alternative loop (shown in light green on the left side of the diagram), Biden and the Democratic Congress basically poured a lot of money into green industry. Their goal was to create new interest groups that would demand continued funding for green technologies as well as other supportive policies. Just as conventional car owners demand cheap gas, electric car owners will demand charging stations. Public opinion would also evolve so that more people would support environmental policies and recognize their economic benefits. Ultimately, once the green loop was bigger than the teal one, there would be political support for pushing carbon emissions down.

The Biden policy probably lowered carbon emissions substantially. But it had no positive effects on public opinion. As I have discussed before, vast expenditures received startlingly little attention. Proponents were either unwilling or unable to defend the policy. The president of the environmentalist Sierra Club, Ben Jealous, emphasized abortion when he advocated for Harris. Even the names of the Biden bills hid their purpose. For instance, the Inflation Reduction Act had nothing to do with reducing inflation and may even have raised it somewhat. In short, the pathway to policy through public opinion failed, either because the messengers barely tried or because no one could have persuaded voters about such matters.

However, the other path shown in green may still work. The Biden bills created hundred of thousands of post-carbon jobs and subsidized many farmers and business owners. Disproportionately–and by design–these people live in Republican states and districts. They are now a powerful interest group.

Clearly, the president and his team will try to wreck what they call the “Green New Deal.” But if the green loop holds, they will fail.

Source: Rennert, K., Errickson, F., Prest, B.C. et al. Comprehensive evidence implies a higher social cost of CO₂. Nature 610, 687–692 (2022). See also a trillion here, a trillion there, and pretty soon, you’re talking real money; tracking the Biden climate investments; a different way in which the 2024 election is a failure for democracy etc.