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[Markets] The Greens Hijack Biden's $3.5 Trillion Budget Proposal (That Could Be A Blessing) The Greens Hijack Biden's $3.5 Trillion Budget Proposal (That Could Be A Blessing)

Authored by Mike Shedlock via MishTalk.com,

The Democrats' Congressional proposals keep getting sillier and sillier...

Deal or No Deal?

"Deal" means agreement among radicals. The Greens hijacked Biden's already strained budget.

Clean Electricity Standard

Please consider Reconciliation Package to Include Clean Electricity Standard.

In an interview with The Hill prior to her tweet, Smith, who is crafting the clean electricity standard legislation with Sen. Ben Ray Luján (D-N.M.), said she had expected the standard to be part of the legislation.

The senator also told The Hill that while the details of the standard will have to be worked out in negotiations, she’s hoping to see a requirement for 80 percent clean electricity by 2030.

My goal is to get to 100 percent clean electricity as soon as possible. President Biden’s goal is to be doing it by 2035,” she said, referencing Senate rules that allow reconciliation bills to raise the deficit for no more than 10 years. 

White House climate adviser Gina McCarthy has said that the clean electricity standard is among her priorities for the legislation. 

Smith said she’d include power coming from wind, solar, geothermal, hydroelectric or nuclear — and fossil fuels only when they use carbon capture technology to prevent their emissions from going into the atmosphere.

Smith also stressed the importance of the clean energy standard, calling it the “centerpiece of our strategy for addressing climate change.”

She said she opposes partial credit for unabated natural gas, which is less carbon-intensive than coal and oil, but still emits planet-warming gases.

Taxing Imports is Part of the Plan

The New York Times reports Taxing Imports is Part of the Plan

Democrats have agreed to include a tax on imports from nations that lack aggressive climate change policies as part of a sweeping $3.5 trillion budget plan stocked with other provisions aimed at ratcheting down fossil fuel pollution in the United States.

The move to tax imports was made public Wednesday, the same day that the European Union outlined its own proposal for a similar carbon border tax, a novel tool that is designed to protect domestic manufacturing while simultaneously pressuring other countries to reduce the emissions that are warming the planet.

Unlike the Europeans, who outlined their plan in a 291-page document, Democrats released no details about their tax proposal on Wednesday. Calling it simply a “polluter import fee,” the framework does not explain what would be taxed, at what rate or how much revenue it would expect to generate.

Carbon Emissions in Tons

Carbon Emission Percentages

Economic Madness 

The US only accounts for 14.5% of carbons and the EU another 8%.

It is well beyond crazy for the US and EU to propose to tax the word to reduce carbons by 55-80% by 2030.

Yet, that is the goal of economic illiterates on both continents.

EU Kicks Off Biggest Push Yet on Climate, Braces for a Fight

Meanwhile, in Europe, EU Kicks Off Biggest Push Yet on Climate, Braces for a Fight.

The European Union rolled out an ambitious climate plan to transform every corner of its economy on Wednesday, and braced for years of tough negotiations to turn it into reality.

Every industry will be forced to accelerate its shift away from fossil fuels in order to cut pollution by at least 55% from 1990 levels by 2030. To achieve that, the bloc will bring new industries such as shipping into what’s already the world’s largest carbon market; ban new combustion-engine cars by 2035; impose new costs on dirty home heating; and force the aviation industry to emit less and pay more.

“Nothing we presented today is going to be easy. It’s going to be bloody hard,” European Commission climate chief Frans Timmermans said. But he said the “existential threat which is the climate crisis” called for radical steps.

EU officials are at pains to emphasize that the transformation must be fair. The bloc has earmarked 72 billion euros ($85.1 billion) in a new fund to help compensate those who lose out, with the money --which is based on current prices -- coming from the expanded market for carbon emissions.

291-Page Document No One Can Explain

The EU border tax is scheduled for 2026. European officials propose a phase-in period to figure out how the tax would actually work in practice to give time for countries to prepare.

"Europe was the first continent to declare to be climate neutral in 2050, and now we are the very first ones to put a concrete roadmap on the table," said European Commission President Ursula von der Leyen.

Blessing in Disguise? 

yes. To understand why, first let's take a look at what is happening beneath the surface in the EU, then the US Senate.

Eurointelligence discusses Opposition to 2035 CO2 Phase-Out

FAZ writes this morning that there is opposition within the European Commission to the phasing-out of the fuel-driven motor car by 2035. Valdis Dombrovkis, Commission vice president, and Thierry Breton and Adina Valean, commissioners for the internal market and transport, favour a postponement to 2040. This debate reminds of us of the postponement of the exit from coal in Germany, which has been put back to 2038. What is happening right now all over Europe is that governments and the Commission are buckling under pressure from industry, and are choosing the soft option of delaying most of the adjustment to the next decade.

Among governments, France is leading to those who favour 2040 as an exit. A 14-year transition phase is beyond the life span of current management boards of car companies. It’s the next guy’s problem.

The other area of disagreement concerns interim targets. The original Commission proposal foresaw a 65% reduction until 2030. Realistically, that would only be achievable if manufacturers already start making and selling electric cars in large quantities by then. It will be interesting to see whether this number, too, will be watered down. If you pick 2040 as your zero target, it would be logically consistent to pick a lower reduction target for 2030 as well - in the order of 50%. That would mean that the whole timeline gets pushed back.

It is also important to remember that this is just the proposal itself. We would not be surprised if the EU Council waters it down even further.

Green Party Implodes in Germany

On June 26, I noted Green Party Implodes in Germany

An Infratest dimap poll, published June 10, debunked one of the more persistent myths about Germany - that it is naturally a green country. Germany has a strong Green party, but there is a specific history to that, one that one should not be confused with general attitudes in society.

Here are some of the highlights. Should the state outlaw behaviour that is particularly damaging to the climate? 53% say No. Are you in favour of higher petrol prices? 75% say No. Should the government encourage a shift from fuel-driven to electrical cars? 57% say No.

The Greens are back to where they were at the beginning of the year, at around 20-22% - which we think is where the current core support lies. 

The above snips from Eurointelligence. 

Reconciliation Odds

The price tag of infrastructure is $1 trillion or so. Pelosi says she will not pass a standalone infrastructure bill. 

The reconciliation package is another $3.5 trillion, and Bernie Sanders is arguing for $6 trillion. 

I fail to see how Senator Joe Manchin (D) from West Virginia (a coal producing state) will get on board with the incredible demands of Senator Tina Smith. 

Add Senator Jon Tester (D) Montana to that list of those questioning this madness. 

Potential Saving Grave

The more demands the extreme radicals place, the more likely the moderates will run away. In the US it only takes one moderate to avoid economic disaster. 

If Tina Smith and Nancy Pelosi insist on economic nonsense, Biden's entire $3.5 trillion reconciliation package will turn to ashes. 

That is the potential saving grace of these economically mad proposals.

*  *  *

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Tyler Durden Fri, 07/16/2021 - 19:00
Published:7/16/2021 6:06:52 PM
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