On the campaign trail, then-candidate Joe Biden’s Build Back Better plan served as the centerpiece of what he promised would be a robust climate agenda. But, despite the potentially civilization-saving significance of the proposal, Biden spoke more about an immediate effect on Americans’ day-to-day lives: creating jobs. “When I think of climate change,” as he has often said before and after being elected president, “I think of jobs.”
The approach had a very clear political logic: the country was in the midst of unprecedented uncertainty with unemployment briefly soaring to nearly 15%. Americans were concerned about their ability to make ends meet. Now, two years later, economic woes remain front of mind for many voters, this time in the form of the most significant inflation in decades. Enter the Inflation Reduction Act. The bill, negotiated behind the scenes by West Virginia Senator Joe Manchin and Senate Majority Leader Chuck Schumer, has many of the same planks and aims as Build Back Better—namely to slash U.S. carbon emissions—but with a new, more timely name slapped on it.
Much has been written about whether the Inflation Reduction Act will actually reduce inflation. (Hint: analysts and economists say it will—even if it will take a few years to kick in). But beyond the policy implications it’s worth considering the significant narrative shift from “job creating” to “inflation busting.” In rebranding Biden’s most significant climate policy as an inflation reduction bill, Democrats have underscored that “climate is everything.” The political rhetoric is finally catching up to reality.
A version of this story first appeared in the Climate is Everything newsletter. To sign up, click here.
To understand how we got here, it’s helpful to look back in time at two pieces of legislation crafted at the peak of the Great Recession: the American Recovery and Reinvestment Act (ARRA) and the American Clean Energy and Security Act (ACES). The acronyms are incredibly wonky, so bear with me here. ACES, a climate bill pure and simple, was presented in 2009 as the country’s opportunity to finally tackle climate change. It would have set a cap on carbon emissions and allowed companies to buy and sell pollution credits. It was complicated and hard to understand; popular support lagged. It never made it into law. ARRA, on the other hand, wasn’t intended to be a climate bill at all. Enacted that year, it pumped nearly $800 billion of federal dollars into the economy for everything from new highways to broadband internet. Crucially, it included $90 billion of federal funding to boost clean technology. The lesson for many policymakers was clear: spending big to invest in climate-related things is popular and politically feasible while complicated regulatory schemes are not. The grassroots push for a program like the Green New Deal entrenched that belief.
Biden, who oversaw the distribution of stimulus funds as vice president, came to the White House last year intending to use the same approach. He proposed spending a few trillion dollars on his Build Back Better plan amid another economic crisis, but it stalled. There are many factors to blame—not least of which is Manchin’s fickleness—but it’s worth pointing out that the jobs narrative may have been less convincing as unemployment declined quickly after Biden took office to around 3.6% today.
As Build Back Better stalled, politicians looked around for other hot-button issues to connect to the bill. Some suggested framing the push as a response to the Russian invasion of Ukraine—cutting reliance on fossil fuels could reduce Russia’s influence. But it was Manchin who arguably had a better sense of the political winds.
With voters consistently ranking inflation among their top concerns, repositioning a massive spending bill as an attempt to address the issue made political sense. That’s not to say that the connection is all rhetoric designed to serve the polls. Analyses from places like Moody’s show the legislation driving a modest decrease in inflation in the medium term.
The links between energy, climate, and inflation are myriad and obvious. The economy runs on fossil energy, and volatile prices can play a key role in inflation—as we’ve seen with the war in Ukraine. And then there are the inflationary effects of extreme weather events, which disrupt supply chains and drive up insurance costs. In my contributions to this newsletter, I often try to draw connections between climate change and the world around us that aren’t necessarily straightforward or widely understood. What a surprise that, this week, Joe Manchin did it for me.
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