Today, the White House released state fact sheets highlighting how the Inflation Reduction Act tackles the climate crisis in states across the country and how families and communities can benefit from a clean energy future. The fact sheet outlines how families can save on their utility bills, get tax credits for electric vehicles and energy-saving appliances, and access the economic opportunities of the clean energy future.
President Biden and Congressional Democrats beat back special interests to pass this historic legislation, delivering the most significant action in U.S. history to tackle the climate crisis and strengthen U.S. energy security. By signing the Inflation Reduction Act, President Biden is delivering on his promise to lower energy costs, create good-paying jobs, and deliver a clean, secure, and healthy future for families across America.
Here is an edited, highlighted transcript of President Joe Biden’s remarks as he signed the Inflation Reduction Act, with historic investments in climate action, long-fought improvements in health care and prescription drug affordability, tax reform and deficit reduction, and in the immortal words of Biden as Obama’s VP, a “BFD.”–Karen Rubin/news-photos-features.com
I’m about to sign the Inflation Reduction Act into law, one of the most significant laws in our history. Let me say from the start: With this law, the American people won and the special interests lost. The American people won and the special interests lost.
For a while, people doubted whether any of that was going to happen. But we are in a season of substance. This administration began amid a dark time in America — as Jim said, “a once-in-a-century pandemic” — devastating joblessness, clear and present threats to democracy and the rule of law, doubts about America’s future itself.
And yet, we’ve not wavered. We’ve not flinched. And we’ve not given in. Instead, we’re delivering results for the American people. We didn’t tear down; we built up. We didn’t look back; we looked forward.
And today — today offers further proof that the soul of America is vibrant, the future of America is bright, and the promise of America is real and just beginning. (Applause.)
Look, the bill I’m about to sign is not just about today, it’s about tomorrow. It’s about delivering progress and prosperity to American families.
It’s about showing the American and the American people that democracy still works in America — notwithstanding all the — all the talk of its demise — not just for the privileged few, but for all of us.
You know, I swore an oath of office to you and to God to faithfully execute the duties of this sacred office.
To me, the critical duty — the critical duty of the presidency is to defend what is best about America. And that’s not hyperbole. Defend what’s best about America. To pursue justice, to ensure fairness, and to deliver results that create possibilities — possibilities that all of us — all of us can live a life of consequence and prosperity in a nation that’s safe and secure. That’s the job.
Fulfilling that pledge to you guides me every single hour of every single day in this job.
You know, presidents should be judged not only by our words, but by our deeds; not by our rhetoric, but by our actions; not by our promise, but by reality.
And today is part of an extraordinary story that’s being written by this administration and our brave allies in the Congress.
This law — this law that I’m about to sign finally delivers on a promise that Washington has made for decades to the American people.
I got here as a 29-year-old kid. We were promising to make sure that Medicare would have the power to negotiate lower drug prices back then — back then — prescription drug prices.
But guess what? We’re giving Medicare the power to negotiate those prices now, on some drugs.
This means seniors are going to pay less for their prescription drugs while we’re changing circumstances for people on Medicare by putting a cap — a cap of a maximum of $2,000 a year on their prescription drug costs, no matter what the reason for those prescriptions are.
That means if you’re on Medicare, you’ll never have to pay more than $2,000 a year no matter how many prescriptions you have, whether it’s for cancer or any other disease. No more than $2,000 a year.
And you all know it because a lot of you come from families that need this. This is a Godsend. This is a Godsend to many families and so, so long overdue.
The Inflation Reduction Act locks in place lower healthcare premiums for millions of families who get their coverage under the Affordable Care Act.
Last year, a family of four saved on average $2,400 through the American Rescue Plan that I signed into law that Congress voted in place.
In the years ahead, thanks to the Inflation Reduction Act, 13 million people are going to continue — continue to save an average of $800 a year on health insurance.
The Inflation Reduction Act invests $369 billion to take the most aggressive action ever — ever, ever, ever — in confronting the climate crisis and strengthening our economic — our energy security.
It’s going to offer working families thousands of dollars in savings by providing them rebates to buy new and efficient appliances, weatherize their homes, get tax credit for purchasing heat pumps and rooftop solar, electric stoves, ovens, dryers.
It gives consumers a tax credit to buy electric vehicles or fuel cell vehicles, new or used. And it gives them a credit — a tax credit of up to $7,500 if those vehicles were made in America.
American auto companies, along with American labor, are committing their treasure and their talent — billions of dollars in investment — to make electric vehicles and battery and electric charging stations all across America, made in America. All of it made in America.
This new law also provides tax credits that’s going to create tens of thousands of good-paying jobs and clean energy manufacturing jobs, solar factories in the Midwest and the South, wind farms across the plains and off our shores, clean hydrogen projects and more — all across America, every part of America.
This bill is the biggest step forward on climate ever — ever — and it’s going to allow us to boldly take additional steps toward meeting all of my climate goals — the ones we set out when we ran.
It includes ensuring that we create clean energy opportunities in frontline and fence-line communities that have been smothered — smothered by the legacy of pollution, and fight environmental injustice that’s been going on for so long.
And here’s another win for the American people: In addition to cutting the deficit by $350 billion last year, in my first year in office, and cutting it $1.7 trillion this year, this fiscal year, we’re going to cut the deficit — I point out — by another $300 billion with the Inflation Reduction Act over the next decade.
We’re cutting deficit to fight inflation by having the wealthy and big corporations finally begin to pay part of their fair share.
Big corporations will now pay a minimum 15 percent tax instead of 55 of them got away with paying zero dollars in federal income tax on $40 billion in profit.
And I’m keeping my campaign commitment: No one — let me emphasize — no one earning less than $400,000 a year will pay a penny more in federal taxes. (Applause.)
Folks, the Inflation Reduction Act does so many things that, for so many years, so many of us have fought to make happen.
And let’s be clear: In this historic moment, Democrats sided with the American people, and every single Republican in the Congress sided with the special interests in this vote — every single one.
In fact, the big drug companies spent nearly $100 million to defeat this bill. A hundred million dollars.
And remember: Every single Republican in Congress voted against this bill.
Every single Republican in Congress voted against lowering prescription drug prices, against lowering healthcare costs, against a fairer tax system.
Every single Republican — every single one — voted against tackling the climate crisis, against lowering our energy costs, against creating good-paying jobs.
My fellow Americans, that’s the choice we face: We can protect the already-powerful or show the courage to build a future where everybody has an even shot.
That’s the America I believe in. (Applause.) That’s what I believe in.
And today — and today, we’ve come a step closer to making that America real.
Today, too often we confuse noise with substance. Too often we confuse setbacks with defeat. Too often we hand the biggest microphone to the critics and the cynics who delight in declaring failure while those committed to making real progress do the hard work of governing.
Making progress in this country as big and complicated as ours clearly is not easy. It’s never been easy.
But with unwavering conviction, commitment, and patience, progress does come…
And when it does, like today, people’s lives are made better and the future becomes brighter, and a nation can be transformed.
That’s what’s happening now. From the American Rescue Plan that helped create nearly 10 million new jobs, to a once-in-a-generation infrastructure law that will rebuild America’s roads, bridges, ports; deliver clean water, high-speed Internet to every American; to the first meaningful gun safety law in 30 years — and if I have anything to do with it, we’re still going to have an assault weapons ban, but that’s another story. And to get significant veterans’ healthcare law in decades, for the first time; to a groundbreaking CHIPS and Science Law that’s going to ensure that technologies and jobs of the future are made here in America — in America.
And all this progress is part of our vision and plan and determined effort to get the job done for the American people, so they can look their child in the eye and say, “Honey, it’s going to be okay. Everything is going to be okay.”
Everything is going to make sure that democracy delivers for your generation. Because I think that’s at stake.
And, now, I know there are those here today who hold a dark and despairing view of this country. I’m not one of them.
I believe in the promise of America. I believe in the future of this country. I believe in the very soul of this nation. And most of all, I believe in you, the American people.
I believe to my core there isn’t a single thing this country cannot do when we put our mind to it. We just have to remember who we are. We are the United States of America.
There is nothing nothing beyond our capacity. That’s why so many foreign companies decided to invest their — make chips in America. Billions of dollars. We’re the best. We have to believe in ourselves again.
And now I’m going to take action that I’ve been looking forward to doing for 18 months. (Laughter and applause.) I’m going to sign the Inflation Reduction Law. (Applause.)
President Joe Biden will sign the Inflation Reduction Act today, a distillation of what Americans have been clamoring for, for the past 30 years. It includes the most significant investment in climate action, plus health care and tax reform while also amazingly reducing the deficit. Here’s what the Inflation Reduction Act will mean to you, by the numbers. This is from the White House:
The Inflation Reduction Act will lower costs for families, combat the climate crisis, reduce the deficit, and finally ask the largest corporations to pay their fair share. President Biden and Congressional Democrats have worked together to deliver a historic legislative achievement that defeats special interests, delivers for American families, and grows the economy from the bottom up and middle out.
Here’s how the Inflation Reduction Act impacts Americans by the numbers:
Cutting Prescription Drug Costs
Today, Americans pay two to three times what citizens of other countries pay for prescription drugs
5-7 million Medicare beneficiaries could see their prescription drug costs go down because of the provision allowing Medicare to negotiate prescription drug costs.
50 million Americans with Medicare Part D will have the peace of mind knowing their costs at the pharmacy are capped at $2,000 per year, directly benefiting about 1.4 million beneficiaries each year.
3.3 million Medicare beneficiaries with diabetes will benefit from a guarantee that their insulin costs are capped at $35 for a month’s supply.
Lowering Health Care Costs
13 million Americans will continue to save an average of $800 per year on health insurance premiums
3 million more Americans will have health insurance than without the law.
The uninsured rate is at an all-time low of 8%, which the historic law will build on.
Defeating Special Interests
$187 million: The amount the Pharmaceutical industry has spent on lobbying in 2022.
1,600: number of lobbyists the pharmaceutical companies had in 2021 – three times the number of Members of Congress
33 years: the amount of time Congressional Democrats have been trying to lower prescription drug costs by allowing Medicare to negotiate drug prices.
19 years: number of years Medicare has been blocked from negotiating prescription drug costs
Lowering Energy Costs
Families that take advantage of clean energy and electric vehicle tax credits will save more than $1,000 per year.
$14,000 in direct consumer rebates for families to buy heat pumps or other energy efficient home appliances, saving families at least $350per year.
7.5 million more families will be able install solar on their roofs with a 30% tax credit, saving families $9,000 over the life of the system or at least $300 per year.
Up to $7,500 in tax credits for new electric vehicles and $4,000 for used electric vehicles, helping families save $950per year.
Putting America on track to meet President Biden’s climate goals, which will save every family an average of $500 per year on their energy costs.
Building a Clean Energy Economy
Power homes, businesses, and communities with much more clean energy by 2030, including:
950 million solar panels
120,000 wind turbines
2,300 grid-scale battery plants
Advance cost-saving clean energy projects at rural electric cooperatives serving 42 million people.
Strengthen climate resilience and protect nearly 2 million acres of national forests.
Creating millions of good-paying jobs making clean energy in America.
Reducing Harmful Pollution
Reduce greenhouse gas emissions by about 1 gigaton in 2030, or a billion metric tons – 10 times more climate impact than any other single piece of legislation ever enacted.
Deploy clean energy and reduce particle pollution from fossil fuels to avoid up to3,900 premature deaths and up to 100,000 asthma attacks annually by 2030.
Making the Tax Code Fairer
$0: how much some of largest, profitable corporations pay in federal income tax.
55: the number of America’s largest, wealthiest corporations that got away without paying a cent in federal income taxes in 2020.
$160 billon: how much the top 1 percent of earners is estimated to evade each year in taxes.
15%: the minimum tax on corporate profits the Inflation Reduction Act imposes on the largest, most profitable corporations.
$124 billion: savings over 10 years the Inflation Reduction Act will generate from collecting taxes already owed by wealthy people and large corporations, according to the Congressional Budget Office.
And no family making less than $400,000 will see their taxes go up a penny.
Reducing the Deficit
The Inflation Act will achieve hundreds of billions in deficit reduction.
The deficit is projected to fall by more than $1.5trillion this year after falling by more than $350 billion last year.
126 leading economists – including 7 Nobel Laureates, 2 former Treasury Secretaries, 2 former Fed Vice Chairs and 2 former CEA Chairs – have said reducing the deficit will help fight inflation and support strong, stable economic growth.
President Joe Biden reacted to the June inflation report saying that while inflation is still unacceptably high, the report is out-of-date, failing to take into account that gas prices – which accounts for a significant amount of the inflation rate – have gone down for nearly 30 days, reducing the price at the pump by 40 cents since mid-June. Still, he said, “inflation is our most pressing economic challenge,” just as it is around the world. Here is his statement the June CPI Inflation report as provided by the White House:
While today’s headline inflation reading is unacceptably high, it is also out-of-date. Energy alone comprised nearly half of the monthly increase in inflation. Today’s data does not reflect the full impact of nearly 30 days of decreases in gas prices, that have reduced the price at the pump by about 40 cents since mid-June. Those savings are providing important breathing room for American families. And, other commodities like wheat have fallen sharply since this report.
Importantly, today’s report shows that what economists call annual “core inflation” came down for the third month in a row, and is the first month since last year where the annual “core” inflation rate is below six percent. Inflation is our most pressing economic challenge. It is hitting almost every country in the world. It is little comfort to Americans to know that inflation is also high in Europe, and higher in many countries there than in America. But it is a reminder that all major economies are battling this COVID-related challenge, made worse by Putin’s unconscionable aggression.
Tackling inflation is my top priority – we need to make more progress, more quickly, in getting price increases under control. Here is what I will do:
First, I will continue to do everything I can to bring down the price of gas. I will continue my historic release of oil from our strategic petroleum reserve. I will continue working with our European allies to put a price cap on Russian oil – sapping Putin of oil revenue. And, I will continue to work with the U.S. oil and gas industry to increase production responsibly — already, the U.S. is producing 12.1 million barrels of oil per day and is on track to break records.
But I will also continue to insist – as I have with urgency recently – that reductions in the price of oil must produce lower gas prices for consumers at the pump. The price of oil is down about 20% since mid-June, but the price of gas has so far only fallen half as much. Oil and gas companies must not use this moment as an excuse for profiting by not passing along savings at the pump.
Second, I will urge Congress to act, this month, on legislation to reduce the cost of everyday expenses that are hitting American families, from prescription drugs to utility bills to health insurance premiums and to make more in America.
Third, I will continue to oppose any efforts by Republicans – as they have proposed during this campaign year — to make things worse by raising taxes on working people, or putting Social Security and Medicare on the chopping block every five years.
Finally, I will continue to give the Federal Reserve the room it needs to help it combat inflation.
Historic Actions Include Authorizing Defense Production Act to Lower Energy Costs, Strengthen Power Grid, and Create Good-Paying Jobs
I find it infuriating that the “news” is completely taken over by the latest travesties by Trump, Putin and Supreme Court, fueling anger and cynicism among Democrats and Progressives who may well take their anger out at the polls and simply not vote – that, I would remind you, is how we got Trump and this Christo Fascist Supreme Court. Biden Administration not doing anything on climate change? Inflation? Health care? Nonsense. This administration has been incredibly productive – finding real solutions, not bandaids, rhetoric and hype, that have at their foundation a sense of equity, sustainability and social justice. Want to solve inflation? Not by the Keystone Pipeline or overturning coal plant rules, but investing in EV infrastructure, as Biden wants to do. But you wouldn’t know it from the media, social or otherwise. It is our practice, then, to publish first-hand accounts from the White House, federal agencies and officials. –Karen Rubin/news-photos-features.com
Today’s clean energy technologies are a critical part of the arsenal we must harness to lower energy costs for families, reduce risks to our power grid, and tackle the urgent crisis of a changing climate. From day one, President Biden has mobilized investment in these critical technologies. Thanks to his clean energy and climate agenda, last year marked the largest deployment of solar, wind, and batteries in United States history, and our nation is now a magnet for investment in clean energy manufacturing.
Since President Biden took office, the private sector has committed over $100 billion in new private capital to make electric vehicles and batteries in the United States. We have made historic investments in clean hydrogen, nuclear, and other cutting-edge technologies. And companies are investing billions more to grow a new domestic offshore wind industry.
We are also now on track to triple domestic solar manufacturing capacity by 2024. The expansions to domestic solar manufacturing capacity announced since President Biden took office will grow the current base capacity of 7.5 gigawatts by an additional 15 gigawatts. This would total 22.5 gigawatts by the end of his first term – enough to enable more than 3.3 million homes to switch to clean solar energy each year.
While President Biden continues pushing Congress to pass clean energy investments and tax cuts, he is taking bold action to rapidly build on this progress and create a bridge to this American-made clean energy future. Today, President Biden is taking action to:
Authorize use of the Defense Production Act (DPA) to accelerate domestic production of clean energy technologies, including solar panel parts;
Put the full power of federal procurement to work spurring additional domestic solar manufacturing capacity by directing the development of master supply agreements, including “super preference” status; and
Create a 24-month bridge as domestic manufacturing rapidly scales up to ensure the reliable supply of components that U.S. solar deployers need to construct clean energy projects and an electric grid for the 21st century, while reinforcing the integrity of our trade laws and processes.
Together, these actions will spur domestic manufacturing, construction projects, and good-paying jobs – all while cutting energy costs for families, strengthening our grid, and tackling climate change and environmental injustice. With a stronger clean energy arsenal, the United States can be an even stronger partner to our allies, especially in the face of Putin’s war in Ukraine.
The stakes could not be higher. That is why President Biden also continues to urge Congress to quickly pass tax cuts and additional investments that advance U.S. clean energy manufacturing and deployment. Failing to take these actions would deny consumers access to cost-cutting clean energy options, add risks to our power grid, and stall domestic clean energy construction projects that are critical to tackling the climate crisis. At the same time, President Biden will keep using his executive authority to take bold action to build an American-made clean energy future.
INVOKING THE DEFENSE PRODUCTION ACT FOR CLEAN ENERGY
Today, President Biden is authorizing the use of the Defense Production Act (DPA) to accelerate domestic production of clean energy technologies – unlocking new powers to meet this moment. Specifically, the President is authorizing the Department of Energy to use the DPA to rapidly expand American manufacturing of five critical clean energy technologies:
Solar panel parts like photovoltaic modules and module components;
Heat pumps, which heat and cool buildings super efficiently;
Equipment for making and using clean electricity-generated fuels, including electrolyzers, fuel cells, and related platinum group metals; and
Critical power grid infrastructure like transformers.
In deploying the DPA, the Biden-Harris Administration will strongly encourage the use of strong labor standards, including project labor agreements and community benefits agreements that offer wages at or above the prevailing rate and include local hire provisions. The Administration also will strongly encourage projects with environmental justice outcomes that empower the clean energy transition in low-income communities historically overburdened by legacy pollution.
Following this announcement, the White House and the Department of Energy will convene relevant industry, labor, environmental justice, and other key stakeholders as we maximize the impact of the DPA tools made available by President Biden’s actions and strengthen domestic clean energy manufacturing.
BOOSTING MADE-IN-AMERICA CLEAN ENERGY WITH FEDERAL PROCUREMENT
President Biden is also putting the full power of federal procurement to work spurring additional domestic solar manufacturing capacity. Today, the President directed the development of two innovative tools to accelerate Made-in-America clean energy:
Master Supply Agreements for domestically manufactured solar systems to increase the speed and efficiency with which domestic clean electricity providers can sell their products to the U.S. Government; and
So-called “Super Preferences” to apply domestic content standards for federal procurement of solar systems, including domestically manufactured solar photovoltaic components, consistent with the Buy American Act.
These federal procurement measures can stimulate demand for up to a gigawatt of domestically produced solar modules in the near term, and up to 10 gigawatts over the next decade from U.S. government demand alone. To further increase the impact of these actions, the Administration will also partner with state and local governments and municipal utilities in these innovative arrangements – increasing the potential market impact over the next decade to as much as over 100 gigawatts. These procurement actions will provide a significant demand anchor for a revitalized domestic solar manufacturing industry.
SUPPORT FOR U.S. GRID-STRENGTHENING, CLEAN ENERGY CONSTRUCTION PROJECTS
Because of private investor confidence in President Biden’s leadership and our national commitment to a clean energy future, the United States is now on track to triple its solar manufacturing capacity by 2024. The expansions to domestic solar manufacturing capacity announced since the President took office will grow the current 7.5 gigawatts of capacity by an additional 15 gigawatts of capacity, for a total of 22.5 gigawatts by the end of his first term – enough to enable more than 3.3 million homes to switch to clean solar energy every year. To rapidly build on this progress and create a bridge to this American-made clean energy future, we need to boost short-term solar panel supply to support construction projects in the United States right now. This is because grid operators around the country are relying on planned solar projects to come online to ensure there is sufficient power to meet demand, and to ensure we can continue to deploy solar at the rates needed to keep us on track to meet the President’s climate goals.
Today, President Biden is using his powers to create a 24-month bridge for certain solar imports while reinforcing the integrity of our trade laws and processes. Specifically, the President is:
Temporarily facilitating U.S. solar deployers’ ability to source solar modules and cells from Cambodia, Malaysia, Thailand, and Vietnam by providing that those components can be imported free of certain duties for 24 months in order to ensure the U.S. has access to a sufficient supply of solar modules to meet electricity generation needs while domestic manufacturing scales up; and
Reinforcing his commitment to safeguarding the integrity and independence of all ongoing trade investigations by career officials at the Department of Commerce and recognizing the vital role these processes play in strengthening our economy.
ADDITIONAL STEPS TO CUT COSTS, SUPPORT GOOD-PAYING JOBS, AND ADVANCE ENVIRONMENTAL JUSTICE
Today’s actions build on this Administration’s existing initiatives to grow domestic clean energy innovation and manufacturing and to lower energy costs for Americans, including:
Permitting More Clean Energy on Public Lands. As part of the Biden-Harris Permitting Action Plan, a new five-agency collaboration is expediting reviews of clean energy projects on public lands through the Department of the Interior, helping us race ahead toward permitting at least 25 gigawatts by 2025 – enough to power around five million homes. These actions have already increased clean energy permitting activities by 35 percent, including major solar project approvals and leases. We have also launched five new Renewable Energy Coordination Offices and reduced rents and fees by more than 50 percent for solar and wind projects on public lands.
Boosting Community-Based Clean Energy in Cities and Rural Areas. The Biden-Harris Administration is helping 17 local communities remove red tape with the SolarAPP+ online tool to enable same-day approvals for residential solar installation permits, and an additional 400 interested communities are in the pipeline. The National Climate Task Force launched new initiatives on increasing deployment of Distributed Energy Resources, including rooftop solar, with a focus on bringing the benefits of these projects to underserved communities. The United States Department of Agriculture provided the largest-ever investment in rural renewable energy last year. In addition, the Department of Energy and the Department of Health and Human Services are partnering to develop and pilot a digital platform that will connect customers who are eligible for the Low Income Home Energy Assistance Program with community solar subscriptions, to further reduce customer energy costs. Likewise, the U.S. Department of Housing and Urban Development is working with municipalities to enable residents of affordable housing to directly benefit from low-cost community solar power without seeing a rent increase or adjustment to their utility allowance.
Supporting a Diverse Solar Workforce with Good-Paying Jobs, including pathways to stable careers with the free and fair choice to join a union. Solar industry jobs consistently rank among the top fastest-growing in the nation, and many require only a high school education or GED. The Economic Development Administration recently awarded funding to support solar employment training in tribal and coal-impacted communities. In addition, the Department of Energy has issued a Request for Information and hosted six workshops to determine common goals and needs from stakeholders, including industry, unions, and training organizations. DOE will continue to explore these issues, including by providing funding, new collaborations with industry, other federal agencies, and state-based job boards to develop equitable worker-centric training and education programs, work-based learning opportunities, and support services such as career counseling, mentorship, and job readiness programs.
Developing Clean Energy Domestic Manufacturing for Export and Building Capacity in Allied Nations. The Export-Import Bank of the United States (EXIM) Make More in America Initiative, approved by the EXIM board in April, will prioritize investments to expand clean energy manufacturing. The U.S. International Development Finance Corporation supports building resilient clean energy manufacturing supply chains in allied nations around the world, reducing global dependence on China.
Investing in Clean Energy for Resilience in Puerto Rico: The Biden-Harris Administration joined forces with the Commonwealth of Puerto Rico to advance dozens of solar energy projects that will enable Puerto Rico to meet its target of 100% renewable electricity, while improving power sector resilience and increasing access to more affordable energy and cleaner air.
The White House has published a memo outlining President Biden’s plan to tackle inflation:
As our economy begins to transition to more stable growth, President Biden has made combatting inflation and lowering costs for families his top economic priority. President Biden’s plan to tackle inflation has three key pillars:
1. Reducing costs on everyday items
2. Lowering the deficit
3. Giving the Federal Reserve the independence it needs to act
The biggest single driver of inflation now is Putin’s war against Ukraine –increases in food and energy prices account for around 50% of this month’s CPI. Putin’s Price Hike hit hard in May: gas pump prices are up by $2 a gallon in many places since Russian troops began to threaten Ukraine. President Biden has taken action to blunt the impact of Putin’s Price Hike for families:
The President announced the release of a record 1 million barrels per day from our Strategic Petroleum Reserve.
He rallied our Allies and partners to join us, releasing a combined 240 million additional barrels of oil on the market.
He expanded access to biofuels like E15, which will lower prices at thousands of gas stations in the across the country.
While oil production is increasing and projected to reach a historic level next year, oil companies are sitting on 9,000 unused permits to drill more and pocketing the largest profits in years.
80% of a typical family’s monthly budget is spent on items other than food and energy. That means that even as we work to address energy and food prices in the near-term, making other necessities more affordable for working families can give families more breathing room at the end of the month.
President Biden announced that tens of millions of households – or nearly 40% of all households in America – will be able to save $50 per month or more on high-speed internet, which is now an economic necessity for American families.
President Biden took action to save hundreds of thousands of families hundreds of dollars a month by fixing the Affordable Care Act’s “family glitch.” Nearly 1 million Americans would see their coverage become more affordable.
President Biden has cut the deficit by $1.7 trillion – more this year than any President in history, reducing inflationary pressures.
The President calls on Congress to act urgently as well.
The President has called on Congress to pass a bill to crack down on ocean shippers to lower the price of goods. In the last year, shipping prices have gone up by as much as 1,000% driving higher prices for families on items from appliances to apparel.
The President calls on Congress to pass legislation to cut costs for families like energy bills and prescription drugs. According to an independent analysis, the clean energy tax credits and investments the President has proposed would save families $500 per year on their energy costs by 2030, and transition our economy away from relying on energy produced by autocrats like Putin. And the President believes that Congress should give Medicare the power to negotiate with pharmaceutical companies, and that Congress should cap the cost of insulin at $35 per month. These reforms wouldn’t just lower costs for consumers; they would also reduce federal spending.
Congress could lower the deficit even more by asking the super wealthy and profitable corporations to pay their fair share. According to an outside analysis, 55 companies paid no money in taxes last year. It’s wrong for the super wealthy and profitable corporations to pay a lower tax rate than a teacher or firefighter.
Congressional Republicans’ only plan to tackle inflation increases taxes for working families. And, their attacks on gas prices are incoherent and dishonest.
Senator Rick Scott, a member of Senate Republican Leadership changed his words on his agenda to raise taxes on millions of working and middle class Americans by $1,500, but still said “We need them pulling the wagon and paying taxes” and that he “apologizes to absolutely nobody.” He also stood by his Congressional Republican plan to put Social Security and Medicare on the chopping block every 5 years.
Congressional Republicans blame President Biden for gas prices, but the truth is that gas pump prices are up by $2 a gallon in many places since Russian troops began to threaten Ukraine. This is Putin’s price hike. A majority of Republicans in Congress support Ukraine in their fight for their democracy and our alliance to strengthen theirposition, and now cynically blame the President for Putin’s actions that have raised prices around the world. That’s not economics, that’s politics.
Congressional Republicans blame the administration for decreased oil production. The truth is oil production is projected to reach a historic level next year. When oil companies produce less, the cost goes up. In 2020, Americans stayed home more and drove less, so oil companies cut back on oil production and refining. Now, demand has returned, but oil production is still 10% below where it was pre-pandemic. Oil companies are sitting on 9,000 unused permits to drill more and pocketing the largest profits in years. The President has called for — and Congressional Democrats have voted for — a “use it or lose it” policy for permits on federal lands, and Congressional Republicans opposed it.
The five biggest oil companies made $35 billion in the first quarter of this year—that’s four times what they made in the same quarter last year. Congressional Republicans oppose making these companies pay their fair share in taxes.
The White House released new state-by-state fact sheets that highlight several economic indicators —including state employment, unemployment insurance claims, gross domestic product, supplemental poverty, and vaccination rates—which demonstrate the robust economic progress under President Biden’s leadership. This wasn’t by accident. This is the result of President Biden’s plan to build the economy from the bottom up and the middle out.
When President Biden took office, our economy was in crisis and COVID-19 was wreaking havoc on our country. Thanks to his American Rescue Plan, unemployment is near historic lows, the vast majority of Americans are vaccinated, the number of adults with a positive outlook on their overall financial well-being reached an all-time high last year, the number of Americans relying on government unemployment benefits has dropped by more than 90%, and new businesses are being created at record rates.
The fact sheets highlight our historic economic recovery strong foundation to transition to stable and steady growth that works for working families. Fact sheets for all 50 states are linked below.
This memo, highlighting five key points of America’s transition to sustainable growth, the role the American Rescue Plan played in that growth, and how the Administration is turning its focus to address a range of global economic challenges with inflation chief among them, was provided by the White House:
Earlier this week, the President noted that our economy is in a moment of transition: from what has been an historic economic recovery to what can be a period of stable, steady growth that works for working families. The President understands that Americans are dealing with the challenge of elevated inflation. And addressing inflation is his top economic priority.
This is a moment when we can build on the unique strengths of our recovery to bring down inflation and ensure that we don’t give up the historic economic gains of the last year. It also means building on the recovery to deliver growth that actually works for working families – unlike the growth that we saw too often in the years before the pandemic, when we were promised that gains for those at the top would trickle down to working families. President Biden’s approach is to build the economy from the bottom up and the middle out.
As we look ahead and aim to achieve stable, steady growth, here are five key points about how we arrived at our current economic moment. In short, the Administration passed the American Rescue Plan in a moment of significant economic uncertainty and, because of the Administration’s decisive action, we now face a range of global economic challenges – with inflation chief among them – from a position of strength.
The American Rescue Plan helped deliver one of the strongest job markets in American history.
When President Biden took office, the unemployment rate was 6.4% and around 20 million Americans were on unemployment insurance. Since then, the unemployment rate has come down to 3.6 % — with only three times in the last 50 years when the rate has been lower – and fewer than 1.5 million Americans are receiving unemployment insurance. Before the Rescue Plan passed, the nonpartisan Congressional Budget Office (CBO) projected the unemployment rate would be 5% right now, and would not drop below 4% until 2026. In addition, the number of Americans between the ages of 25 and 54 who are working or looking for work is higher today than it was before the pandemic began. In the wake of the Great Recession, that recovery took 12 years. As the Washington Post noted this weekend, we are in the midst of a “great return to work.” While it “took more than six years to recover from the Great Recession … this jobs recovery is on track to take about 2.5 years. That’s worth celebrating.”
The American Rescue Plan has meant the U.S. recovery has been the envy of the world.
According to the latest World Economic Outlook from the International Monetary Fund, the U.S. economy will be larger at the end of this year—relative to its pre-pandemic size—than any other Group of 7 economy. The U.S. economy may grow faster this year than China’s economy for the first time since 1976, according to a projection by Bloomberg Economics. CBO recently projected that U.S. economic growth would continue in 2022 and 2023, albeit at a slower rate than in 2021, with unemployment remaining low and inflation falling throughout this year and next. The CBO forecast was roughly in line with the consensus of private sector forecasters.
The American Rescue Plan has meant economic security for millions of families.
Since President Biden took office, incomes are up 5.1% overall and by 11.9% for the bottom 50% of the income distribution – even after accounting for inflation – due to job creation and higher earnings. Self-reported financial well-being at the end of 2021 reached its highest level on record, with 78% of adults reporting that they are financially comfortable. In the same survey, 68% of Americans said they could cover a $400 emergency cash expenses – the highest level in the history of the survey and up 18 percentage points since 2013. Bankruptcy filings also remained below pre-pandemic levels, eviction filings have remained 30% below pre-pandemic levels across the eight months since the eviction moratorium ended, and foreclosures hit an all-time low in 2021.
The Rescue Plan didn’t just improve our economic position; it improved our fiscal position too.
The CBO projected that the deficit will fall by $1.7 trillion this year. This is the largest nominal reduction in the federal deficit in history. According to their projections, the deficit as a share of the economy this year will be at a lower level than in 2019, before the pandemic. It is also a lower level than CBO projected for this year before the American Rescue Plan passed, showing that the strong economic recovery resulting from President Biden’s economic and vaccination plans were not just good for our economy but also for our fiscal position. Public debt as a percent of the economy is also projected to be lower this year than was projected before the Rescue Plan passed – further reflecting the degree to which our strong economic recovery has improved our fiscal position. This progress on deficits and debt was not pre-ordained. In addition to responsibly winding down emergency programs, around half of the reduction in the deficit this year is projected to be driven by an increase in revenues, as household and business earnings have increased given the strong economic recovery.
Inflation is a global challenge, with many causes, but the Rescue Plan is not its predominant cause.
Inflation is elevated around the world, particularly in light of Putin’s invasion into Ukraine, which has driven global food and energy prices higher. Inflation is at its highest level on record in the Euro Area and in Germany, the highest level in 40 years in the U.K., and the highest level in more than 30 years in Canada. Consumer prices have risen by 8.2% in the United States in the last year, 8.1% in the Euro Area, and 9% in the United Kingdom.
Putin’s actions in Ukraine have driven inflation higher in recent months, with gas prices up $1.51 since Putin began amassing troops on the border of Ukraine. It is of course not plausible that disruptions in global energy and food markets are the result of the American Rescue Plan.
And even before disruptions to global energy and food markets have driven inflation higher, many other factors boosted demand, shifted its composition, and constrained supply, which led to higher prices. The pandemic meant that American consumers shifted their consumption from services to durable goods. Businesses were unprepared for demand returning quickly, and we saw an inward shift in supply capacity – from auto production to domestic energy production to rental cars. And supply chain pressures meant bottlenecks and thinner inventories that also drove up prices.
That’s why we know that even without the Rescue Plan – or with a smaller Rescue Plan – inflation would have still been elevated. In fact, according to one independent analysis, keeping inflation close to 2% would have required an unemployment rate in the double digits – instead of today’s 3.6% unemployment rate. Moreover, without the Rescue Plan, another independent analysis shows that we would have had less growth, less job creation, and more human suffering.
The Biden Administration is justifiably touting a $1.3 trillion decrease in the budget deficit – the largest one-year decline in U.S. history – to demonstrate the success of its fiscal policies, and particularly, its success in getting control of the coronavirus pandemic and justifying its FY2023 budget proposal. Here’s a statement from the White House:
When the President took office, the pandemic was raging in communities across the country and our economy was struggling to recover from the most severe downturn since the Great Depression. The economy shrunk, and the unemployment rate stood at 6.4 percent. And, the deficit had risen to $3.1 trillion in 2020—yet with trillions in resources, the Trump Administration didn’t secure vaccines for all Americans, most schools were closed, and testing and medical equipment shortages continued.
Even before the pandemic, the Trump tax cuts had added $2 trillion to deficits over a decade. The deficit increased every year of the previous administration.
Unlike his predecessor, President Biden prioritized fiscal responsibility. In the face of the extraordinary challenges he inherited, the President made clear that bold action was needed to jumpstart the economic recovery. He knew that robust investment to change the course of the pandemic and support workers, families, and small businesses was not only the right strategy to build a stronger economy, but also to decrease the deficit. A strong economic recovery would result in less emergency spending and drive future deficits down. In March 2021, he signed into law the historic American Rescue Plan.
The President’s Budget shows that this strategy paid off. The strongest economic growth in four decades, powered by the American Rescue Plan, has also contributed to a historic decline in the deficit—by fueling strong revenue growth and allowing the Administration to responsibly phase down emergency pandemic-related spending. The President’s Budget projects that the deficit in 2022 will be more than $1.3 trillion lower than last year’s—the largest ever one-year decline in our country’s history. It will be less than half of the 2020 deficit the President inherited.
The President is now working to build on that progress and further reduce the deficit by reforming the tax system so that corporations and the wealthiest Americans pay their fair share. As the Budget shows, with these reforms, we can cut costs for families, continue growing the economy from the bottom up and middle out, and put America on a sound fiscal course for the future—shrinking the deficit the President inherited by two-thirds as a share of the economy.
President Biden’s Strategy to Combat the Pandemic and Jumpstart the Economy is Driving Down Deficits
Thanks to the American Rescue Plan and the President’s strategy to control the pandemic, in 2021 our economy grew at 5.7 percent, the fastest rate in nearly 40 years. We created more than 6.5 million jobs, the most our country has ever recorded in a single year. The unemployment rate has dropped to 3.8 percent, lower than the Congressional Budget Office had projected in its pre-American Rescue Plan baseline at any point over the next decade. And between the start and the end of 2021, we went from about 41,000 to more than 200 million Americans vaccinated, and from most schools closed to 99 percent of schools are open for in-person learning.
The Administration’s economic success and success in controlling the pandemic is lowering the deficit in two ways.
First, because of the historic pace of our economic and labor market recovery, the economy no longer needs the kind of emergency support it received last year. With businesses open and people back at work, the Federal Government will spend about $1 trillion less on pandemic and economic support in 2022 than in 2021. That includes hundreds of billions of dollars less support to businesses, which are now making investments and creating jobs without the need for help. Likewise, after historic drops in both the overall unemployment rate and the long-term unemployment rate—the share of people out of work for more than six months—we no longer need emergency unemployment assistance, and ongoing Unemployment Insurance claims are at their lowest level since 1970.
Second, a stronger economy means higher incomes for households and higher earnings for businesses. Because of this economic progress, the government is projected to collect more than $300 billion in additional revenues compared to last year, a nearly 10 percent increase.
The President’s Budget Continues to Lower Deficits
Even before the pandemic, the Trump Administration added $2 trillion to deficits over 10 years through tax cuts that largely helped wealthy people and large corporations. President Biden believes in a different approach: growing the economy from the middle out, not the top down, and paying for all new investments by ensuring that the wealthiest Americans and large corporations pay their fair share.
As he made clear in his State of the Union address, the President is committed to working with Congress to enact legislation that lowers costs for American families, expands the productive capacity of the American economy, and further reduces the deficit: by reducing prescription drug costs and fixing the tax code to ensure corporations and wealthy people pay the taxes they already owe and close loopholes they exploit.
The President’s FY 2023 Budget also proposes additional smart, targeted investments designed to spur durable economic growth, create jobs, reduce cost pressures, and foster shared prosperity—while more than fully offsetting their cost. The Budget reduces deficits by more than $1 trillion over the next 10 years.
Under the Budget policies, deficits as a share of the economy would fall to less than one-third of the 2020 level the President inherited. Overall, the Budget details an economically and fiscally responsible path forward—addressing the long-term fiscal challenges facing our country while making investments that will produce stronger economic growth and broadly shared prosperity for generations to come.
Americans are recoiling at rising prices at the pump, failing to appreciate that Europeans are seeing prices rise 45%, and despite the fact our supplies are not impacted by the embargo on Russian oil. Rather, Big Oil continues to record record profits, use windfall profits to buy back stock, reward shareholders and pay bonuses to CEOs. President Biden is appealing to the companies’ “patriotism” by pumping more supply and not pocketing quite as much, and also warning against price-gouging. He is also pushing the oil companies to utilize unused leases. Here is a fact sheet from the White House of how President Biden is responding to what he has dubbed “Putin’s Price Hike” at the pump: –Karen Rubin/news-photos-features.com
Americans face rising prices at the pump because of Putin’s Price Hike. Since Putin accelerated his military build-up around Ukraine, gas prices have increased by nearly a dollar per gallon. Because of Putin’s war of choice, less oil is getting to market, and the reduction in supply is raising prices at the pump for Americans. President Biden is committed to doing everything in his power to help American families who are paying more out of pocket as a result. That is why President Biden announced a two-part plan to ease the pain that families are feeling by increasing the supply of oil starting immediately and achieving lasting American energy independence that reduces demand for oil and bolsters our clean energy economy.
Immediately Increasing Supply
At the start of this year, gas was about $3.30 a gallon. Today, it’s over $4.20, an increase of nearly $1. And now, a significant amount of Russian oil is not making it to market. The President banned the import of Russian oil – which Republicans and Democrats in Congress called for and supported. It was the right thing to do. But, as the President said, Russian oil coming off the global market would come with a cost, and Americans are seeing that at the pump.
The first part of the President’s plan is to immediately increase supply by doing everything we can to encourage domestic production now and through a historic release from the Strategic Petroleum Reserve to serve as a bridge to greater supply in the months ahead.
Increasing Domestic Production
The fact is that there is nothing standing in the way of domestic oil production. The United States is already approaching record levels of oil and natural gas production. There are oil companies that are doing the right thing and committing to ramp up production now. Right now, domestic production is expected to increase by 1 million barrels per day this year and nearly 700,000 barrels per day next year.
Still, too many companies aren’t doing their part and are choosing to make extraordinary profits and without making additional investment to help with supply. One CEO even acknowledged that, even if the price goes to $200 a barrel, they’re not going to step up production.
Right now, the oil and gas industry is sitting on more than 12 million acres of non-producing Federal land with 9,000 unused but already-approved permits for production. Today, President Biden is calling on Congress to make companies pay fees on wells from their leases that they haven’t used in years and on acres of public lands that they are hoarding without producing. Companies that are producing from their leased acres and existing wells will not face higher fees. But companies that continue to sit on non-producing acres will have to choose whether to start producing or pay a fee for each idled well and unused acre.
Historic Release from the Strategic Petroleum Reserve as a Bridge Through the Crisis
After consultation with allies and partners, the President will announce the largest release of oil reserves in history, putting one million additional barrels on the market per day on average – every day – for the next six months. The scale of this release is unprecedented: the world has never had a release of oil reserves at this 1 million per day rate for this length of time. This record release will provide a historic amount of supply to serve as bridge until the end of the year when domestic production ramps up.
The Department of Energy will use the revenue from the release to restock the Strategic Petroleum Reserve in future years. This will provide a signal of future demand and help encourage domestic production today, and will ensure the continued readiness of the Strategic Petroleum Reserve to respond to future emergencies.
President Biden is coordinating this action with allies and partners around the world, and other countries are expected to join in this action, bringing the total release to well over an average 1 million barrels per day.
Achieving Real American Energy Independence
The United States is the largest oil producer in the world and is a net energy exporter. Despite that, the actions of a dictator half a world away can still impact American families’ pocketbooks. The President will announce his commitment to achieving real energy independence – which centers on reducing our dependence on oil altogether.
The President will call on Congress to pass his plan to speed the transition to clean energy that is made in America. His plan will help ensure that America creates millions of good-paying union jobs in clean, cutting-edge industries for generations to come. And it will save American families money in the immediate future – including more than $950 a year in gas savings from taking advantage of electric vehicles, and an additional $500 a year from using clean electricity like solar and heat pumps to power their homes.
And, the President will issue a directive, authorizing the use of the Defense Production Act to secure American production of critical materials to bolster our clean energy economy by reducing our reliance on China and other countries for the minerals and materials that will power our clean energy future. Specifically, the DPA will be authorized to support the production and processing of minerals and materials used for large capacity batteries–such as lithium, nickel, cobalt, graphite, and manganese—and the Department of Defense will implement this authority using strong environmental, labor, community, and tribal consultation standards. The sectors supported by these large capacity batteries—transportation and the power sector—account for more than half of our nation’s carbon emissions. The President is also reviewing potential further uses of DPA – in addition to minerals and materials – to secure safer, cleaner, and more resilient energy for America.
This week alone, President Biden announced historic efforts to increase energy efficiency and lower costs for consumers. The Department of Energy opened applications for more than $3 billion in new Bipartisan Infrastructure Law funding—ten times the historical funding levels of the Weatherization Assistance Program—for energy efficiency and electrification upgrades in thousands of homesthat will save families hundreds of dollars on utility bills. The Administration also advanced smart standards that will lower consumer costs, including a roadmap of 100 actions this year that will save families $100 annually through more efficient home appliances and equipment, as well as new fuel economy standards for cars and trucksto save drivers money at the pump. And the Administration is seeking additional opportunities to ramp up the deployment of heat pumps to displace fuel burned in buildings, as well as programs to drive efficiency, electrification, and use of clean fuels in the industrial sector.