Prepared Remarks by U.S. Senator Chuck Grassley of Iowa
Chairman, U.S. Senate Committee on Finance
On the Green New Deal
Tuesday, March 26, 2019
I appreciate the majority leader bringing the Green New Deal to a vote this week so every senator had an opportunity to go on record.
I voted no.
Some of my Democratic colleagues may argue that a vote against the Green New Deal demonstrates an unwillingness to reduce our dependence on fossil fuels and tackle serious environmental issues of the day.
But, nothing could be further from the truth.
Contrary to popular belief, the United States is not the bad actor on the world stage.
The U.S. has reduced our carbon emissions by 758 million metric tons per year since 2005.
This is the largest decline of any country in the world.
Meanwhile, China and India’s carbon emissions have grown.
According to the U.S. Energy Information Administration, the United States consumption of biofuels and other renewable energy has more than doubled from 2000 to 2017.
The U.S. will only continue to increase renewable energy consumption through 2050 as we see more investments in wind, solar, biomass, geothermal, and other alternative energies.
Let’s be clear – A no vote on the Green New Deal is a vote against a government takeover of our economy that would stifle economic growth, bankrupt the nation, and endanger the prosperity of all Americans.
A no vote is a vote in favor of continuing an open and free economy that has made America the richest country in the world.
The fact is the Green New Deal is wholly unrealistic in its goal of obtaining net zero carbon emissions within 10 years.
We are not going to be successful at reducing our dependence on fossil fuels and lowering our carbon emissions through virtue signaling.
And, that is all the Green New Deal boils down to – virtue signaling. It is all lofty goals and aspirations with no concrete plan or concern as to feasibility.
It’s easy to be for a vaguely worded, nonbinding resolution calling on the Federal Government to accomplish certain goals.
But guess what? That’s us!
Congress is the part of the Federal Government with the responsibility under the Constitution to write the laws.
If members of Congress have concrete ideas about what the Federal Government should be doing, they should introduce real legislation detailing who should do what to accomplish their goals.
Instead of a “green dream,” as Speaker Pelosi called it, we need to focus on common sense bipartisan approaches that have an actual shot of making a difference.
Cutting taxes is an effective way to encourage positive, environmentally conscious ways to produce electricity and fuel.
This is what I have sought to do as a leader on renewable and alternative energy production for decades. -I was the original author of the production tax credit for wind energy in 1992.
During my leadership on the Senate Finance Committee during the 2000s, I oversaw the establishment, enhancement, and renewal of numerous tax incentives that promote clean energy from sources such as wind and solar, to renewable fuels like biodiesel, to energy efficient buildings, homes and appliances.
Unlike the aspirational goals of the Green New Deal, these are real, proven, bipartisan actions I helped shepherd into law to make the United States more energy independent and improve our environment.
Renewable energy is a smart investment and the fastest-growing source for electricity generation in the United States.
According to the U.S. Energy Information Administration, utility-scale solar power is expected to increase by 10 percent in 2019 alone, while wind power is expected to surpass hydropower for the first time.
As prices continue to fall, the economic benefits from these clean energy investments will only increase.
Already Iowa leads the nation for its share in renewable energy.
Iowa wind generates nearly 37 percent of the state’s electricity from wind and the state’s largest utility is set to generate 100 percent of its electricity within a couple years.
Iowa ranks first in the nation in the production of ethanol and biodiesel.
Iowa alone accounted for over 26 percent of the entire U.S. ethanol production and over 17 percent of the U.S. biodiesel production.
The solar industry in Iowa continues to mature and ranks 17th nationally.
The bottom line is renewable energy helps diversify Iowa’s economy, creates jobs in rural America, and strengthens U.S. energy independence.
Instead of trying to build on these and other proven policies, the authors of the Green New Deal are more concerned with trying to correct all the ills they see in the U.S. economic system, and even our broader society.
Here’s a list of the grievances they want to attack in the name of an environmentally sustainable economy: life expectancy, wage stagnation, economic mobility, income inequality, systemic injustices, the oppression of indigenous people, the unhoused, and the list goes on and on.
Don’t get me wrong. These are important issues that deserve our attention as a nation.
But, it’s simply not realistic to believe they can all be solved through a plan that targets environmental sustainability.
And, of course, since no crisis should be allowed to go to waste, every aspect of the progressive agenda must be implemented to fend off the threat of climate change.
According to an analysis by the American Action Forum, the portion of the so-called Green New Deal plan focused on eliminating carbon emissions, by itself, would cost between $8.3 and $12.3 trillion.
Of course, that’s assuming it is followed up with actual legislation that attempts to implement the goals it lays out.
But, this only accounts for a fraction of the Green New Deal’s cost.
The portion about the progressive economic agenda that includes enacting universal health care, free college tuition, a federal jobs guarantee program, and much more is estimated to cost between $43 and $81 trillion.
That puts the total cost of the Green New Deal at between $51 and $93 trillion over the first ten years.
$93 trillion, can you imagine?
That is more money than the United States Government has spent in its entire 230-year history.
How would we even go about paying for this?
Several Democrats have floated ideas or introduced bills to tax the wealthy that I assume may be offered up as possibilities.
Earlier this year, the House author of the Green New Deal suggested imposing tax rates of 70 percent or more on earnings over $10 million.
Here in the Senate, Senator Warren has proposed an annual wealth tax of 2 percent on assets over $50 million and 3 percent on assets over $1 billion.
Not to be out done, Senator Sanders has introduced legislation to supercharge the death tax with rates as high as 77 percent on estates exceeding $1 billion.
More recently, Representative DeFazio reintroduced his proposal to tax securities transactions.
Even if we assume these proposals would not have detrimental economic or behavioral effects – which we know they would – they would not come anywhere close to covering the price tag of the Green New Deal.
The Washington Post reported that a 70-percent tax rate on incomes over $10 million could theoretically raise $720 billion over 10 years.
Senator Warren’s own estimates suggest her annual wealth-tax proposal could raise as much as $2.75 trillion in a decade.
According to Senator Sanders, his death-tax proposal would raise $315 billion over a decade, and DeFazio’s transaction tax is estimated to bring in $777 billion.
So, even under the rosiest assumptions, their proposals combined would only cover between 5 and 10 percent of the Green New Deal’s cost.
The fact is there are not enough millionaires and billionaires in the United States to cover the price tag.
That reminds me of former U.K. Prime Minister Margaret Thatcher’s wise observation: “The trouble with socialism is that eventually you run out of other people’s money.”
Many of the Green New Deal’s backers appear to realize this and have suggested that offsetting its cost is unnecessary.
According to them, it can be paid for simply by printing more money.
Yes, that’s right.
Their solution is the same as what has been tried by every bankrupt third-world country around the world. Just crank up the printing presses.
The poster child for this fantasy in the world today is Venezuela--a country whose economic vitality in the 1970s has been driven into the ground by socialist policies financed in large measure by churning out currency, leading to multi-million percent inflation rates.
I hope now that Senators have had an opportunity to go on record in support or opposition to the resolution, the nonsense that is the Green New Deal will be put to rest.
Hopefully, we can now all rally around sensible, proven policies to secure our energy independence and improve the environment.
Affordable, clean energy is key to moving the U.S. forward.
A good starting point would be to enact the tax extenders legislation I introduced last month with Ranking Member Wyden.
This legislation would extend nearly a dozen separate practical and proven incentives for renewable energy and energy efficiency.
Investing in alternative forms of clean energy is good the environment, good for national security and energy independence, good for job creation and economic development, and good for taxpayers.