8 Things Moderates Love About the Inflation Reduction Act
The Inflation Reduction Act, signed into law last year, has proven to be a huge win for American businesses and families. With an unapologetically capitalist approach to solving some of our country’s toughest problems on climate, competitiveness, and American manufacturing, the act is already helping power a strong economy.
Here are eight key things moderates love about the Inflation Reduction Act.
1. A pragmatic strategy that leverages the power of the private sector: The Inflation Reduction Act succeeds by making clean energy affordable, after years of failed efforts to make fossil fuels costly. It leverages the strength of America’s private sector to fund and scale evidence-based strategies to supercharge clean energy innovations and revitalize our domestic workforce to build the technologies of the future in America’s heartland. The result? A huge boom to our economy, catalyzing private capital to invent, manufacture, and build clean energy in the US and outcompete other nations as we sell it to the world.
2. Tackling climate change: At $369 billion, the IRA marks the single largest investment in climate and energy in American history. By spurring investments in clean energy through tax incentives and grants, this multifaceted legislative framework uses carrots to give American businesses, innovators, and investors the tools they need to take on climate change.
As a result, it has sparked an economic upturn, channeling hundreds of millions of dollars back into our economy, fostering the creation of thousands of high-paying jobs on American soil, enabling 80% clean electricity by 2030, and setting us on a path to achieve President Biden’s goal of reducing emissions by 50-52% below 2005 levels by 2030.
3. Backing an all-of-the-above approach to climate: Climate change requires urgent action, so we can’t afford to leave any tools in the toolbox. That’s why the IRA funds an innovation-centered strategy for climate technologies. With a robust commitment to practical solutions, it allocates $9 billion to foster the growth of markets for cleaner industrial materials and propels the next phase of nuclear energy with an investment of $700 million in high-assay low-enriched uranium (HALEU), a pivotal fuel source essential for the upcoming generation of nuclear reactors. As part of its vision for a sustainable future, the IRA also creates a path to make hydrogen the next super commodity, through a strategic framework of tax credits. These bold strides underscore its resolute commitment to tangible, innovative, and impactful climate action.
4. Establishing the United States as an Electric Vehicle Powerhouse: The automobiles of the future will be electric, and the IRA helps ensure vehicles and the batteries they run on are built in America. It allocates $2 billion in Domestic Manufacturing Conversion Grants to help US automakers and suppliers retool their factories to make EVs and so electric vehicles are made by Americans, for Americans.
Third Way’s analysis finds private sector investment in EVs will bring potentially $5.1 trillion annually to the US by 2050 allowing the US to become a global leader in electric vehicle manufacturing.
5. Boosting American Competitiveness: From Georgia to Michigan, we’re seeing auto companies like Ford, Hyundai, Panasonic, and Toyota announce investments across the EV supply chain bringing thousands of good-paying jobs to working families. Through strategic investments in infrastructure and measures to reduce inflation, the act strengthens America's competitive edge creating an opportunity for the US to gain trillions of dollars in sales, millions of jobs, and a more secure supply of energy from this lucrative global market.
6. Creating American Jobs: Moderates cheer a new manufacturing renaissance to build a clean energy economy. The IRA doubled the rate of manufacturing construction and is bringing opportunity to more people in more places. Today, the economy is roaring back with 13 million jobs created under President Biden, record-low unemployment rates, and the longest-ever streak of sub-4% unemployment.
7. Addressing the National Debt: The IRA reduces the deficit by hundreds of billions of dollars over the next decade. This deficit reduction, accomplished by making our tax code more equitable and fair and tackling prescription drug prices, has helped ease inflation. As the name promises, the Inflation Reduction Act has delivered relief where Americans need it most: at the gas pump, and over the kitchen table.
8. Lowering Health Care Costs: The IRA is delivering substantial health care savings to American families. Together with President Biden's regulation to make coverage through employers more affordable (known as the family glitch fix), the IRA is saving a typical family about $1,000 each year. It is also saving $1,400 a year for families who get coverage on their own by capping their insurance premium costs. For retirees, the IRA is capping patients’ insulin costs at $35 per month. Starting in 2025, Medicare will have a cap on all drug costs for the first time ever.