It appears Democrats are not going to pass any sort of major climate legislation under Joe Biden’s presidency after all.
For weeks now, the party’s leaders have been attempting to negotiate a scaled down bill with Sen. Joe Manchin to replace the White House’s ambitious, $2 trillion Build Back Better plan, which the West Virginia Democrat filleted in December. Democrats had hoped the narrower piece of legislation might include tax hikes for deficit reduction, green energy spending, and new rules that would allow Medicare to negotiate on prescription drug prices.
But the Washington Post, citing two people familiar with the talks, reports that Manchin told the Democratic leadership on Thursday that he would “not support an economic package that contains new spending on climate change or includes new tax increases targeting wealthy Americans or corporations.” What’s left, then? Not much. Manchin is apparently open to a standalone prescription drug bill and a modest, two-year extension of the expanded Obamacare subsidies Biden included in his coronavirus relief legislation, which would at least keep Americans’ insurance premiums from shooting up before the midterms.
NBC News also confirmed the Post’s story. A spokesman for Manchin told the network in statement that, “Senator Manchin believes it’s time for leaders to put political agendas aside, re-evaluate and adjust to the economic realities the country faces to avoid taking steps that add fuel to the inflation fire.” So it sounds like he is indeed pulling the plug on climate negotiations. Sen. Ron Wyden, who negotiated the green energy section of the deal, said, “I’m not going to sugarcoat my disappointment here.”
That Manchin is flipping over the checkers board this late in the game isn’t a surprise, exactly. He hinted he might only be open to a prescription drug bill after this week’s ugly inflation report. “We know what we can pass. It’s basically the drug pricing on Medicare,” he said. “Is there any more we can do? I don’t know. But I’m very, very cautious.”
So what are the implications, now that Manchin has largely pulverized the last remaining bricks of the Biden agenda into (no doubt environmentally hazardous) dust?
For the planet, it’s obviously not great. The green energy tax credits at the center of the climate plan House Democrats passed last year would have helped decarbonize the electric grid by providing a massive flood of cash to subsidize renewables (reducing the cost of new solar or wind plants by 30 percent, for instance). Without them, U.S. carbon emissions are still expected to decline going forward, but not nearly fast enough to meet the Biden administration’s goals under the Paris climate accord.
As I wrote when Manchin knifed Build Back Better back in December, an analysis by the REPEAT Project at Princeton’s Zero Lab found that the original Democratic climate plan would have helped the U.S. slash emissions by about 44 percent compared to 2005 levels by 2030, close to our Paris target. As of now, the U.S. is on pace to reduce emissions by just 27 percent.
To be honest, that difference will not make or break the earth’s warming future; though we obviously need to stop belching carbon into the atmosphere, the decisions made by China or India going forward will be vastly more important globally. But our failure to pursue an aggressive climate policy will make it much more difficult for the U.S. to present itself as a global leader on these issues and undermine our credibility as we try to encourage other countries to decarbonize; it may mean that green technology development ends up happening elsewhere, as well.
Biden may still be able to push his climate goals forward using executive power. But the Supreme Court’s recent ruling in West Virginia v. EPA significantly crimped the administration’s ability to regulate carbon using any kind of a sophisticated scheme, and it’s unclear what sorts of administrative actions will be allowed to stand in the future.
As for the politics of it? Well, regardless of whether Joe Biden runs for a second term, it appears he will go down as a relatively unsuccessful president legislatively, a minor figure who entered office with FDR-sized hopes and is exiting with, I don’t know, Carter- or Ford-style results. His accomplishments will include a massive coronavirus relief bill that only won him brownie points with the public for a few months and likely helped light the spark for 40-year-high inflation; a moderately large infrastructure package that most voters appear to have yawned at; and a least-common-denominator package dealing of guns and mental health. Allowing Medicare to negotiate prescription drug prices is a very popular idea, and if that passes, it will at least allow Democrats to continue advertising themselves as the party of health care in the future. But it’s not exactly something to hang a presidency on.
And of course much of that boils down to Manchin, a senator who made his personal fortune in the coal industry and represents a state where fossil fuels rule. For most of the past year, he’s insisted that he could be open to some sort of climate compromise, but that he was deeply worried about inflation and the deficit and didn’t want to overspend. In January, he told reporters: “The climate thing is one that we could come to an agreement much easier than anything else”
Thus, he led his party through interminable rounds of negotiations in the hope that they might finally satisfy him with a deal, reaching the point where his fellow Democrats offered him a deficit-reduction package that might help tame inflation while funneling some money to the party’s priorities on health climate. Skeptics doubted his sincerity, and assumed he was just stringing the party along; inevitably, if you talked about him on Twitter, someone would post an image of Lucy pulling the football away from Charlie Brown just as he was about to kick it. It pretty much came to symbolize the whole process.
Personally, I chose to think there was a chance Dems would reach a decent deal with Manchin, because it seemed so completely odd and pointless for anybody to drag this process out when he could have just said no to begin with. Some recent reporting has suggested that a climate bargain was potentially within reach.
As the Post’s Jeff Stein explained on Twitter recently, the White House and Manchin were both willing to make a trade in which Biden would approve major oil and gas projects, including a pipeline in West Virginia, if the Senator would back more green energy funding, resulting in an all-of-the-above energy deal pairing a medium-term fossil fuels push with long-term decarbonization. But because of the Senate rules being used to pass it, the spending bill can’t actually include any fossil fuel project approvals. That created a dilemma: The White House didn’t want to waive through new pipelines and drilling only for Manchin to say no to the climate bill. And Manchin didn’t want to say yes to the climate bill only for the White House to renege on the new pipelines and drilling. The two sides didn’t trust each other.
If that’s what actually killed the prospects for an agreement, it’s tragic. But if Thursday’s news turns out to be the final word, then the simplest, most obvious explanation will be that the coal guy was always going to conclude this process by telling the planet to drop dead.
Update July 15, 11:15 AM
On Friday morning, Manchin told a West Virginia radio program that he was still potentially open to climate spending, but that he wanted to wait to see July’s inflation data, after being disappointed by June’s unexpectedly high jump in the Consumer Price Index. “As far as I’m concerned, I want climate, I want energy policy,” he said, while adding that “I’m not going to do something, and overreach, that causes more problems” with regard to inflation or the economy. He suggested that he was worried about tax increases hurting the economy, despite having advocated for them for most of these negotiations. But he insisted he was still open to talks. “I’m not stopping,” he said.
There are a few reasons why Democrats might not be willing to give Manchin more time. First, July inflation data won’t be available until the middle of August, meaning that any bill wouldn’t likely pass until early September. But August is when health insurance companies will have to set their premiums for next year; if Democrats don’t extend Obamacare’s enhanced coverage subsidies before then, that means voters will get letters informing them that their health premiums are going up before the midterms.
There’s also no guarantee that July’s inflation data will look significantly better than June’s (they will likely reflect declining gas prices, but beyond that it’s a wild card). And, most importantly of all, Manchin isn’t making any guarantees on climate spending. After months of his slippery negotiations, there’s no particular reason for the party to trust that he’d agree on anything—especially now that he’s backing off tax increases he previously supported, while insisting any climate funding must be paid for. It’s not clear why, at this point, anybody would give him the benefit of the doubt.