How much Inflation Control Law Two years on, and the fact that Vice President Kamala Harris plans to call on the federal government to end food price gouging, the answer is clear: it hasn't worked.
Her administration was led by the laughably misnamed IRAMore grocery stores would lead to more price competition, but Harris' proposal shows Americans are concerned about high prices.
Inflation is Decreased to 2.9% Food prices are up 21% from three years ago, down from just over 8% annually in 2022 when the IRA was signed, but rather than curbing inflation, the IRA likely increased it by giving tax credits to corporations to produce more expensive energy and transportation. (Related: The good, the bad and the ugly: Biden's climate change bill enters its second year)
The tax deduction soared along with inflation. When the IRA was enacted into law, U.S. Treasury They estimated that the tax credits would cost $270 billion over 10 years. Treasury report The 10-year cost of the IRA tax deduction exceeds $1 trillion Goldman Sachs estimates.
These tax credits encourage the development of wind and solar power, but this raises the cost of producing electricity and makes food more expensive. The wind doesn't always blow and the sun doesn't always shine, so intermittent energy is more expensive than continuous energy.
Wind farms need to be backed up by natural gas plants, and solar panels need backup batteries. Natural gas plants produce cheaper electricity by running continuously than by cycling on and off when the wind stops. But natural gas and coal plants are being pushed out by perverse renewable energy subsidies.
California's wind and solar mandates could drive residential electricity rates up nearly 170% between 2004 and 2024, from about 12 cents per kilowatt-hour to 33 cents. The U.S. average is about 16 cents. (Related article: Electricity prices rise seven times faster under Trump)
RALEIGH, NORTH CAROLINA – AUGUST 16: Democratic US Presidential candidate Vice President Kamala Harris speaks about her policy platform, including improving the cost of living for Americans, at the Hendrick Center for Automotive Excellence in Raleigh, North Carolina, August 16, 2024. This is the first major policy speech the candidate has given since receiving the Democratic nomination. (Photo by Grant Baldwin/Getty Images)
Renewable energy requires large-scale transmission infrastructure to deliver energy to densely populated areas. This includes: $220 billion, according to the Department of EnergyBusinesses then pass on the costs to households through higher tax rates.
Similarly, electric vehicles (EVs) that qualify for the $7,500 IRA tax credit are more expensive than their gasoline-powered counterparts: A Ford F150 pickup truck XL costs $36,965, while a comparable electric vehicle, the Ford Lightning pickup truck, costs $62,995.
The IRA requires that EVs account for a certain percentage of domestic production in order to qualify for the tax credit, but there is a big loophole for leased vehicles. Commercial vehicles do not have to meet national requirements to qualify for the credits.Leased vehicles count as commercial vehicles, which means you can lease an EV and get a tax credit.
The IRA tax credits were intended to benefit Americans and develop domestic industry, but Chinese companies partner with American companies to get the tax credits, and as a result, the IRA makes China stronger and the United States weaker.
Ford and Contemporary Amperex Technology Corp. (CATL) have a joint venture in Michigan. Beijing will have influence over both the technology and plant operations at the $2.5 billion plant. $2.2 billion Tax incentives.
China has an advantage in battery technology Over 70 percent It has the second-largest global electric vehicle battery production capacity and CATL is the largest producer, benefiting from its close ties to the Chinese Communist Party (CCP).
One of the rationales for the IRA was to reduce emissions, but by many calculations, tax-favored renewable energy increases global emissions. Chinese-made solar panels, wind turbines, and batteries use electricity generated by coal-fired power plants. Emissions are generated during the shipping of components to Europe and the US, and also when the panels and turbines are disposed of at the end of their life.
As VP Harris' announcement makes clear, inflation has not been solved. The IRA has likely made it worse by raising energy and transportation costs and putting domestic energy at a disadvantage. This is not a happy anniversary.
Diana Ferchtgott Ross is director of the Center for Energy, Climate and Environment and the Herbert and Joyce Morgan Fellow in Energy and Environmental Policy at the Heritage Foundation. The Heritage Foundation is mentioned for identification purposes only. The views expressed in this article are the author's own and do not necessarily reflect the institutional position of the Heritage Foundation, the National Review Institute, or their boards of directors.
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