• July 20th, 2024
  • Saturday, 06:54:55 AM

Colorado Played Major Role in passing Inflation Reduction Act Cost Savings

Photo: Colorado Fiscal Institute Pegah Jalali


Pegah Jalali


2022 will be a year we’ll remember for a long time.


Facing war in Eastern Europe, economic uncertainty driven by the highest inflation in decades, still dealing with the effects of a deadly pandemic, and running out of time to act on climate, Congress — yes, Congress — decided to do something about it.


The Inflation Reduction Act, which was signed into law by President Joe Biden last month, will make historic investments in clean energy and good-paying jobs, all while lowering people’s health care and energy costs. Perhaps most importantly, the act is paid for by nudging the federal tax code closer to one where greedy corporations and wealthy individuals stop avoiding paying their fair share.


Despite Congressional leaders and President Biden agreeing broadly on the need for action, Washington D.C. politics was the main barrier to passing anything. But just when all hope seemed lost, word came of a deal. Real steps toward a fairer tax code for working people, lower health care and energy costs, and most importantly policies that will cut climate-harming pollution by 40% by 2030.


Who was at the center of passing the biggest single investment in climate sustainability in world history? Colorado’s U.S. Sens. Michael Bennet and John Hickenlooper.


Even though we know there’s more work to do, it’s good to know Colorado has leaders with the skills and experience to get it done.


While many gave up hope of a deal, Bennet and Hickenlooper worked tirelessly to hammer one out. Perhaps it’s because they’re acutely aware of the need for action having seen the devastation of the Marshall Fire and Glenwood Canyon mudslides firsthand. Perhaps it’s because both have a reputation for being moderates themselves that they were able to persuade Sens. Joe Manchin and Krysten Sinema to support it. Whatever the reason, they got it done.


The Inflation Reduction Act will lower costs and fight climate change by providing consumers with big tax credits on new energy efficient appliances, electric vehicles, and other products. These policies will reduce pollution, save people money, and buy us much-needed time to find bigger solutions to protect our communities and our environment from climate change. Coloradans will also be protected from big price increases on health insurance, and older Coloradans save money on prescription drugs they get through Medicare.


That’s not to say it was all advocates were hoping for. Economically, the legislation should help tamp down some inflationary pressure, but the root causes of economic hardship and inequity must be addressed. College, child care, and housing all remain unaffordable for far too many families; our tax code still lets billionaires pay lower effective tax rates than working and middle class people, a disproportionate number of whom are people of color; and as much as the Inflation Reduction Act invests in the fight against climate change, we have more work to do to ensure a livable future for our children and grandchildren.


Even the bill itself was a compromise. Hickenlooper deserves praise for securing his policy ending the practice of noncompetitive leasing of oil and gas on public lands in the final bill, but we must acknowledge that tying onshore clean energy projects to federal oil and gas leasing is a step in the wrong direction. Though the corporate minimum tax and stock buyback excise tax is a good start, lawmakers failed to close other loopholes or simply raise rates on the very wealthiest people.


While the U.S. works to implement the Inflation Reduction Act and educate people about the cost-saving benefits, we have to keep looking forward. There remains unfinished business to address if we’re to have an economy and an environment that lets everyone build good, healthy, long lives for themselves and their families.


Even though we know there’s more work to do, it’s good to know Colorado has leaders with the skills and experience to get it done.



Pegah Jalali is the environmental policy analyst for the Colorado Fiscal Institute, a nonpartisan, nonprofit organization that advances fiscal and economic policies that promote equity and widespread prosperity. This oped is republished from Colorado Newsline under a Creative Commons license.


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