As Democrats rework their strategy to introduce a Build Back Better bill that can pass the Senate, it would be wise to retain House provisions that invest in rebuilding communities dependent on fossil fuels.
As my research has shown, these communities have been abandoned by previous administrations and congresses. The Trump administration, for example, has doubled down on strategies that prolong the country’s reliance on extractive industries, ostensibly to help these communities, but to benefit corporate leaders.
The March 2020 COVID-19 Economic Rescue Package, administered by the then Secretary of the Treasury Steven MnuchinSteven MnuchinConservatives are outraged that Sarah Bloom Raskin actually believes in capitalism Khashoggi murder suspect arrested The Hill’s Morning Report – Featured by Facebook – Biden tackles omicron risks with new travel rules, provided loans to oil and gas companies, but did not require companies to keep workers on the payroll. The administration even rejected states’ request for funds to cover abandoned wells that would have kept workers employed and returned land to productive use.
The Trump administration falsely promised a coal stimulus. In reality, with the successive bankruptcies of the coal companies, the workers sacrificed their health and pension benefits, while the coal executives obtained bonuses and the coal companies discharged their responsibilities to clean up the land devastated by mountaintop kidnapping and abandoned mines. Business owners have shrewdly moved inefficient coal-fired plants to regulated electricity markets, such as West Virginia’s. As a result, state ratepayers are forced to subsidize these plants, even though switching to cheaper solar and wind generation and other energy efficiency programs would have lowered ratepayers’ rapidly rising electricity bills. .
The hard work and sacrifices of fossil fuel communities fuel America’s economic prosperity and benefit regions often far from centers of extraction. That same hard work and tenacity is energizing their efforts to rebuild their economies. The Coalfield Development Inc. has incubated social enterprises in construction, agriculture, and solar installation, African American farmers are leveraging their knowledge and heritage to foster regenerative agriculture.
In 2019, Reimagine Appalachia, a group of grassroots organizations (labour, environmental, and civic groups), set out steps to build an inclusive economy rooted in renewable energy, sustainable agriculture, and conservation. The United Mine Workers of America’s 2021 Energy Transition Initiative has called for government investments that can help spur job creation with living wages, including jobs in renewable energy, and that guide investment in communities of coal.
The Build Back Better bill puts workers and communities first. It is injecting $5 billion into the Economic Development Administration, with specific exceptions for communities dependent on fossil fuels, to develop regional economic growth poles. It encourages the construction of renewable energy facilities, with additional incentives for those settling in communities affected by the closure of coal mines and coal-fired power plants.
It provides $9.7 billion in loans and grants to help rural cooperatives switch to renewable energy sources. As my book explains, many of these co-ops, which serve 92 percent of persistently poor counties in the United States, are bound by long-term contracts with more expensive coal-fired power generation. Environmental Justice Grants help with sanitation in communities on the front lines of coal burning and fossil fuel extraction. Climate funds can support conservation efforts to mitigate worsening flooding. These provisions, along with loans and grants to support solar installation and weather protection, can spur job creation and generate local tax revenue, critical to the economic transformation of these communities.
The bill invests in people. Extending the Child Tax Credit will keep thousands of children out of poverty and provide them with better health care and better education opportunities. Several studies have shown how investments in childhood do more than pay off in wage returns. The bill supports investments to meet basic needs, including water and wastewater management and energy conservation programs. It extends the black lung excise tax which pays for the health and benefits of affected miners.
The bill has the strong support of many local organizations, labor unions, environmental groups, nearly 400 business and investor coalitions, and the general public.
According to the Congressional Budget Office, the bill would result in a $160 billion deficit over 10 years (0.1% of GDP). In contrast, the 2017 tax cut that added $1.9 trillion to the debt over a decade, with benefits skewed in favor of the wealthiest Americans. Deficit spending for people and communities in distress, with proper oversight, is a prudent economic strategy.
Shanti Gamper-Rabindran, the author of “America’s Energy Gamble: People, Economy and Planet” (Cambridge University Press 2022), is an associate professor at the University of Pittsburgh.