President Obama’s proposed budget yesterday has called for increasing the electric vehicle tax credit to $10,000, but the broader document was immediately dismissed by political opponents, and said by the Wall Street Journal as having zero chances of being passed.
Among a host of far reaching initiatives that are beyond the scope of GM-Volt coverage, the $3.8 trillion budget for the fiscal year starting Oct. 1 cuts subsidies for gas and oil interests while boosting funds for green energy.
The Journal wrote the proposal was rejected out of hand by Republican lawmakers and presidential candidates as “a political document that fails to seriously tackle the nation’s growing debt.” Nonetheless, the Journal added that the budget showed where the Obama administration’s priorities are.
News organizations that picked up the $10k for EVs angle first were also of the conservative variety. In an article titled,“Obama hikes subsidy to wealthy electric car buyers” by The Daily Caller, and re-posted by Fox News, it was calculated the proposal would cost taxpayers $100 million assuming just 10,000 plug-in vehicles were purchased.
Obama’s plan to put one million EVs on the road by 2015 is also in contention, and has been cited as a driving force for his desire to further grease the tracks for green transportation.
But what the future actually holds is still the subject of debate. The Daily Caller quoted Pennsylvania Republican Rep. Mike Kelly who we previously reported has introduced legislation to end auto subsidies.
“The nation is $15.2 trillion in debt and climbing, so we’ve got to be a lot more careful about how we spend the money,” he told The Daily Caller in January.
The bill, said the Chevy dealer, will also shed light on “the money-losing crony-capitalist deals between Democratic legislators and business interests, such as Chevy,” wrote the Daily Caller.
“How do we get this crony capitalism across to the voters?” Kelly said. “We tell them, ‘Folks, this is your money, not the administration’s money. It’s being thrown around by this president. … It’s not a good investment, and there’s no positive return on it.”
Green energy highlights
On a more positive front, Green Car Congress sidestepped all political commentary, and merely noted elements of the budget that would boost discretionary funds for the U.S. Department of Energy by 3.2 percent, or $27.2 billion.
As pointed out in a pdf distributed by the White House, and re-listed by Green Car Congress, key elements in the proposed budget for the DOE include:
• Increases funding for applied research, development, and demonstration in the Office of Energy Efficiency and Renewable Energy ($2.3 billion). These funds are part of a broad energy strategy that emphasizes priorities in clean energy and advanced manufacturing, through grants, financing assistance, and tax incentives that accelerate fundamental research, technology development, and commercialization.
• Within EERE, the Budget increases funding by nearly 80 percent for energy efficiency activities and increases funding for the development of the next generation of advanced vehicles and biofuels. It maintains support for research, development, and demonstration of renewable electricity generation, including: $310 million for the SunShot Initiative; $95 million for wind energy, including off-shore wind technologies; and $65 million for geothermal energy and enhanced geothermal systems.
• The Budget also provides $770 million for the Office of Nuclear Energy, which includes funding for advanced small modular reactors R&D. Other priority activities include R&D on storage, transportation, and disposal of nuclear waste that supports the implementation of recommendations put forward by the Blue Ribbon Commission on America’s Nuclear Future.
• The Budget also includes $350 million for the Advanced Research Projects Agency–Energy.
• $421 million for fossil energy R&D, including $12 million to fund a multi-year research initiative aimed at advancing technology and methods to develop domestic natural gas resources. Specifically, DOE, in collaboration with the Environmental Protection Agency and the US Geological Survey, will focus on understanding and reducing the environmental, health, and safety risks of natural gas and oil production from hydraulic fracturing in shale and other geologic formations.
• More than doubles research and development on advanced manufacturing processes and advanced industrial materials, enabling companies to cut costs by using less energy while improving product quality.
• Promotes basic research through $5 billion in funding to the Office of Science.
• Works through the President’s Better Building Initiative to make non-residential buildings more energy efficient by catalyzing private sector investment. Creates jobs through mandatory funding for HomeStar incentives to consumers to make their homes more energy efficient.
• Positions the Environmental Management program to meet its legally enforceable cleanup commitments at sites across the country.
• Continues investments to maintain a nuclear weapons stockpile in support of the planned decrease in deployed US and Russian weapons under the New Strategic Arms Reduction Treaty.
• Provides funding for securing, disposing of, and detecting nuclear and radiological material worldwide.
The budget proposed for the Department of Transportation includes:
• An increase of 2 percent in discretionary and mandatory budgetary resources to $74 billion.
• $50 billion in immediate investments to support critical infrastructure projects, improving America’s roads, bridges, transit systems, border crossings, railways, and runways.
• Six-year, $476-billion surface reauthorization plan to modernize the country’s transportation infrastructure, and pave the way for long-term economic growth.
• $2.7 billion in 2013 and $47 billion over six years to develop high-speed passenger rail corridors and improve intercity passenger rail service to significantly enhance the national rail network.
• More than $1 billion for 2013 for the Next Generation Air Transportation System.
Beyond energy questions
The scope of the entire budget encompasses far more than energy issues. Among top controversies spurred by the proposal is that Obama is purportedly targeting “the rich” (albeit allegedly rewarding high income earners with an EV tax subsidy).
Among ways the proposed budget reportedly stands to hit the wealthiest Americans is by letting Bush-era tax cuts expire for families that earn more than $250,000 and restoring the estate tax to its 2009 level. This is supposed to generate $1.7 trillion in new revenue over 10 years, according to the Journal.
The Washington Post and Bloomberg reported Obama has said his proposed budget would in total save at least $4 trillion over the next 10 years and stabilize government borrowing.
The budget also projects the deficit will exceed $1 trillion for the fourth straight year in 2012, which the Journal pointed out means that “Mr. Obama will have fallen short of his promise to cut the deficit in half by the end of his first term.”
We could go on, but we’re already past the scope of automotive news, let alone Volt news.
In his defense, Obama said he is exercising “common sense,” not meaning to pick on classes.
“The budget that we’re releasing today is a reflection of shared responsibility,” Obama said in Virginia on Monday. “And some people go around; they say, ‘Well, the president is engaging in class warfare.’ That’s not class warfare; that’s common sense.”
Again, this goes way beyond Volt news but in the interest of staying on topic, we will ask: Do you think the federal plug-in subsidy might be increased? Or, as it’s already threatened, will the subsidy be taken away? Or will it remain the same?
Is the subsidy truly necessary in your view? If it were removed, how would that affect the electrified vehicle industry?
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