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    This Remote Mine Could Foretell the Future of America’s Electric Car Industry

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    Hiding a thousand feet below the earth’s surface in this patch of northern Minnesota wetlands are ancient mineral deposits that some view as critical to fueling America’s clean energy future.Tim Gruber for The New York TimesA company called Talon Metals is drilling here around the clock, extracting samples of rock rich with nickel in a bid to become the country’s sole source of a material used to power zero-emission vehicles.But some locals are fighting the mine, for fear it could pollute their environment. The pushback hints at how difficult it may be to build an all-American supply chain that powers the country’s transition to electric vehicles.This Remote Mine Could Foretell the Future of America’s Electric Car IndustryTAMARACK, Minn. — In this isolated town of about 100 people, dozens of employees are at work for Talon Metals, drawing long cylinders of rock from deep in the earth and analyzing their contents. They liken their work to a game of Battleship — each hole drilled allows them to better map out where a massive and long-hidden mineral deposit is lurking below.The company is proposing to build an underground mine near Tamarack that would produce nickel, a highly sought-after mineral that is used to power electric vehicles. It would be a profitable venture for Talon, which has a contract to supply nickel for Tesla’s car batteries, and a step forward in the country’s race to develop domestic supply chains to feed the growing demand for electric vehicles.But mines that extract metal from sulfide ore, as this one would, have a poor environmental record in the United States, and an even more checkered footprint globally. While some in the area argue the mine could bring good jobs to a sparsely populated region, others are deeply fearful that it could spoil local lakes and streams that feed into the Mississippi River. There is also concern that it could endanger the livelihoods and culture of Ojibwe tribes whose members live just over a mile from Talon’s land and have gathered wild rice here for generations.Talon says it will invest heavily to design the world’s greenest and most responsible mine yet, one that they say “Joe Biden can love.” But some people in the community remain skeptical, including about the company’s promises to respect Indigenous rights, like the tribes’ authority over lands where their members hunt and gather food. Part of that mistrust stems from the fact that Talon’s minority partner, Rio Tinto, provoked outrage in 2020 by blowing up a 46,000-year-old system of Aboriginal caves in Australia in a search for iron ore.Kelly Applegate, the commissioner of natural resources for the Mille Lacs Band of Ojibwe, said he was “very concerned” about how the mine might damage the environment. “This again is an assault on Native culture, a disturbance of our way of being, another trauma that could potentially happen to our people,” he said.He described it as a “huge environmental justice issue” to mine local resources for electric cars that the tribe’s members would be unable to afford. Except for some wealthy homeowners who spend their summers around the lakes, the area is one of the poorest parts of Minnesota. Native Americans in Minnesota experience poverty at higher rates than any other racial or ethnic group in the state. Locals say the only Tesla for miles is Talon’s company car.“Talon and Rio Tinto will come and go — greatly enriched by their mining operation. But we, and the remnants of the Tamarack mine, will be here forever,” Mr. Applegate said.The project, which lies 50 miles west of Lake Superior, highlights some of the challenges that are emerging as the Biden administration tries to transition America to electric vehicles. The administration has said it wants to make the supply chains for batteries more resilient by sourcing minerals inside North America. But that desire could bring its own potential for environmental damage and infringement of the rights of Indigenous Americans. Much of the nation’s supply of battery materials is near tribal land.The world urgently needs to switch to cleaner cars to limit the global damage from climate change, many climate activists say. Last week, California approved a plan to ban the sale of new gas-powered cars by 2035.But current supply chains for electric vehicle batteries — and the batteries that would be needed for the electric grid that would charge that fleet of vehicles — rely on some adversarial and heavily polluting foreign nations. Much of the nickel that goes into car batteries is produced by strip mines that have decimated rainforests in Indonesia and the Philippines, releasing vast amounts of carbon dioxide before being refined in Chinese factories powered by coal.Read More on Electric VehiclesBanning Gasoline Cars: California is leading the way in the push to electrify the nation’s car fleet with a plan to ban sales of new internal-combustion vehicles by 2035, but the rule will face several challenges.Inflation Reduction Act: The law extends tax incentives in an effort to steer more U.S. consumers toward electric cars. But new rules complicate the qualification process.Plug-In Hybrids: After falling behind all-electric cars, U.S. sales of plug-in hybrids have been surging. The high cost of electric cars and gasoline have given them an opening.Car Crashes: Tesla and other automakers capture data from their vehicles to operate their products. Experts say the collected information could also improve road safety.Another source of nickel is a massive mining operation north of the Arctic Circle in Norilsk, Russia, which has produced so much sulfur dioxide that a plume of the toxic gas is big enough to be seen from space. Other minerals used in electric vehicle batteries, such as lithium and cobalt, appear to have been mined or refined with the use of child or forced labor.With global demand for electric vehicles projected to grow sixfold by 2030, the dirty origins of this otherwise promising green industry have become a looming crisis. The Democrats’ new tax and climate bill devotes nearly $400 billion to clean energy initiatives over the next decade, including electric vehicle tax credits and financing for companies that manufacture clean cars in the United States.New domestic high-tech mines and factories could make this supply chain more secure, and potentially less damaging to the global environment. But skeptics say those facilities may still pose a risk to the air, soil and water that surrounds them, and spark a fierce debate about which communities might bear those costs.The project is near lakes and streams that feed into the Mississippi River, and where Ojibwe tribes have gathered wild rice for generations.The potential risks to plants and wildlife come from the sulfide ores; the ores, in which materials like copper and nickel are lodged, can leach out sulfuric acid and heavy metals. More than a dozen former copper mines in the United States are now Superfund sites, contaminated locations where taxpayers can end up on the hook for cleanup.In January, the Biden administration canceled leases for another copper-nickel mine near a Minnesota wilderness area, saying the Trump administration had improperly renewed them.Talon Metals insists that it will have no such problems. “We can produce the battery materials that are necessary for the energy transition and also protect the environment,” said Todd Malan, the company’s chief external affairs officer and head of climate strategy. “It’s not a choice.”The company is using high-tech equipment to map underground flows of water in the area and create a 3-D model of the ore, so it can mine “surgically” while leaving other parts of the earth undisturbed, Mr. Malan said. Talon is also promising to use technology that will safely store the mine’s toxic byproducts and do its mining far underground, in deep bedrock where groundwater doesn’t typically penetrate.Talon has teamed up with the United Steelworkers union on work force development. And Rio Tinto has won a $2.2 million Department of Energy grant to explore capturing carbon near the site, which may allow the mine to market its products as zero emission.“We can produce the battery materials that are necessary for the energy transition and also protect the environment,” said Todd Malan, the chief external affairs officer and head of climate strategy at Talon.In a statement, Talon said it was committed to “meaningful consultations with tribal sovereign governments and tribal people” and producing a mine plan that addressed their concerns, as well as working with tribal governments interested in economic benefit sharing.The company has held several informational meetings with tribal staff and members, but some tribal members say they still need far more details from Talon about its plans.If the mine comes online in 2026 as scheduled, it will be positioned to feed a hungry market. The United States currently has one operating nickel mine, in Michigan, but its resources will be exhausted by 2026.In Washington, a bipartisan consensus is growing that the country should reduce its reliance on risky overseas minerals. To limit global warming to the levels that advanced countries have agreed on, the International Energy Agency estimates, the world will need roughly 20 times as much nickel and cobalt by 2040 as it had in 2020 and 40 times as much lithium.Recycling could play a bigger role in supplying these materials by the end of the decade, and some new car batteries do not use any nickel. Yet nickel is still highly sought after for electric trucks and higher-end cars, because it increases a vehicle’s range.The infrastructure law passed last year devoted $7 billion to developing the domestic supply chain for critical minerals. The climate and tax law also sets ambitious thresholds for ensuring that electric vehicles that receive tax incentives are partly U.S.-made.Elisabeth Kachinske logged core samples containing nickel at Talon’s offices in Tamarack, Minn.Talon’s proposed mine could help Tesla meet those thresholds. Tesla gets its nickel from China, Australia, New Caledonia and Canada, and its chief executive, Elon Musk, has begged miners to produce more.Some environmental and left-leaning groups that have long been skeptical of domestic mining are adjusting those positions, arguing that resources are needed for the energy transition.Collin O’Mara, the chief executive of the National Wildlife Federation, said that there was a growing need for battery materials that were mined responsibly, and that Talon was promising to use state-of-the-art techniques to minimize the mine’s footprint.But he acknowledged that for local residents it would still take a leap of faith in new technologies and Talon’s ability to apply them. “There still isn’t an example of an existing mine that has had no impacts,” he said.The economic potential — and the environmental risks — may go far beyond a single mine. The entire region is home to deposits of nickel, copper and cobalt, which were formed 1.1 billion years ago from a volcano that spewed out miles of liquid magma.Talon has leased 31,000 acres of land in the area, covering an 11-mile geological feature deep under the swamp. The company has zealously drilled and examined the underground resources along one of those 11 miles, and discovered several other potential satellite deposits.Elizabeth Skinaway, a member of the Sandy Lake Band of Minnesota Chippewa, is especially concerned about damage to the wild rice, which she has gathered in lakes near the proposed mine for 43 years.In August, the company announced that it had also acquired land in Michigan’s Upper Peninsula to explore for more nickel.Talon will start Minnesota’s environmental review process within a few months, and the company says it anticipates a straightforward review. But legal challenges for proposed mines can regularly stretch to a decade or more, and some living near the project say they will do what they can to fight the mine.Elizabeth Skinaway and her sister, Jean Skinaway-Lawrence, members of the Sandy Lake Band of Minnesota Chippewa, are especially concerned about damage to the wild rice, which Ms. Skinaway has been gathering in lakes several miles from the proposed mine for 43 years.Ms. Skinaway acknowledges the need to combat climate change, which also threatens the rice. But she sees little justice in using the same kind of profit-driven, extractive industry that she said had long plundered native lands and damaged the global environment.“The wild rice, the gift from the creator, that’s going to be gone, from the sulfide that’s going to leach into the river and the lakes,” she said. “It’s just a really scary thought.”“We were here first,” said her sister. “We should be heard.”The Talon drill site near Tamarack. More

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    Biden’s Big Dreams Meet the Limits of ‘Imperfect’ Tools

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    The student loan plan is the latest example of Democrats practicing the art of the possible on the nation’s most pressing economic challenges and ending up with risky or patchwork solutions.WASHINGTON — President Biden’s move this week to cancel student loan debt for tens of millions of borrowers and reduce future loan payments for millions more comes with a huge catch, economists warn: It does almost nothing to limit the skyrocketing cost of college and could very well fuel even faster tuition increases in the future.That downside is a direct consequence of Mr. Biden’s decision to use executive action to erase some or all student debt for individuals earning $125,000 a year or less, after failing to push debt forgiveness through Congress. Experts warn that schools could easily game the new structure Mr. Biden has created for higher education financing, cranking up prices and encouraging students to load up on debt with the expectation that it will never need to be paid in full.It is the latest example, along with energy and health care, of Democrats in Washington seeking to address the nation’s most pressing economic challenges by practicing the art of the possible — and ending up with imperfect solutions.There are practical political limits to what Mr. Biden and his party can accomplish in Washington.Democrats have razor-thin margins in the House and Senate. Their ranks include liberals who favor wholesale overhaul of sectors like energy and education and centrists who prefer more modest changes, if any. Republicans have opposed nearly all of Mr. Biden’s attempts, along with those of President Barack Obama starting more than a decade ago, to expand the reach of government into the economy. The Supreme Court’s conservative majority has sought to curb what it sees as executive branch overreach on issues like climate change.As a result, much of the structure of key markets, like college and health insurance, remains intact. Mr. Biden has scored victories on climate, health care and now — pending possible legal challenges — student debt, often by pushing the boundaries of executive authority. Even progressives calling on him to do more agree he could not impose European-style government control over the higher education or health care systems without the help of Congress.The president has dropped entire sections of his policy agenda as he sought paths to compromise. He has been left to leverage what appears to be the most powerful tool currently available to Democrats in a polarized nation — the spending power of the federal government — as they seek to tackle the challenges of rising temperatures and impeded access to higher education and health care.Arindrajit Dube, an economist at the University of Massachusetts Amherst who consulted with Mr. Biden’s aides on the student loan issue and supported his announcement this week, said in an interview that the debt cancellation plans were necessarily incomplete because Mr. Biden’s executive authority could reach only so far into the higher education system.“This is an imperfect tool,” Mr. Dube said, “that is however one that is at the president’s disposal, and he is using it.”But because the policies pursued by Mr. Biden and his party do comparatively little to affect the prices consumers pay in some parts of those markets, many experts warn, they risk raising costs to taxpayers and, in some cases, hurting some consumers they are trying to help.Mr. Biden’s plan would forgive up to $10,000 in student debt for individual borrowers earning $125,000 a year or less and households earning up to $250,000, with another $10,000 for Pell grant recipients.Cheriss May for The New York Times“You’ve done nothing that changes the structure of education” with Mr. Biden’s student loan moves, said R. Glenn Hubbard, a Columbia University economist who was the chairman of the White House Council of Economic Advisers under President George W. Bush. “All you’re going to do is raise the price.”Mr. Hubbard said Mr. Biden’s team had made similar missteps on energy, health care, climate and more. “I understand the politics, so I’m not making a naïve comment here,” Mr. Hubbard said. “But fixing through subsidies doesn’t get you there — or it gets you such market distortions, you really ought to worry.”Mr. Biden said on Wednesday that his administration would forgive up to $10,000 in student debt for individual borrowers earning $125,000 a year or less and households earning up to $250,000, with another $10,000 in relief for people from low-income families who received Pell grants in school.What’s in the Inflation Reduction ActCard 1 of 8What’s in the Inflation Reduction ActA substantive legislation. More

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    China’s Record Drought is Drying Rivers and Feeding Its Coal Habit

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    Dry weather in southwestern China has crippled huge hydroelectric dams, forcing cities to impose rolling blackouts and driving up the country’s use of coal.HONG KONG — Car assembly plants and electronics factories in southwestern China have closed for lack of power. Owners of electric cars are waiting overnight at charging stations to recharge their vehicles. Rivers are so low there that ships can no longer carry supplies.A record-setting drought and an 11-week heat wave are causing broad disruption in a region that depends on dams for more than three-quarters of its electricity generation. The factory shutdowns and logistical delays are hindering China’s efforts to revive its economy as the country’s leader, Xi Jinping, prepares to claim a third term in power this autumn.The ruling Communist Party is already struggling to reverse a slowdown in China, the world’s second largest economy, caused by the country’s strict Covid lockdowns and a slumping real estate market. Young people are finding it hard to get jobs, while uncertainty over the economic outlook is compelling residents to save instead of spend, and to hold off on buying new homes.Now, the extreme heat is adding to frustration by snarling power supplies, threatening crops and setting off wildfires. Reduced electricity from hydroelectric dams has prompted China to burn more coal, a large contributor to air pollution and to greenhouse gas emissions that cause global warming.Many cities around the country have been forced to impose rolling blackouts or limit energy use. In Chengdu, the capital of Sichuan Province, several neighborhoods went without electricity for more than 10 hours a day.An electronic billboard shut down to save energy in Chengdu, China.Agence France-Presse — Getty ImagesVera Wang, a Chengdu resident, said that just to charge her electric car, her boyfriend waited in a long line overnight at a charging station that was only partly operating. It was 4 a.m. by the time he reached the front of the line.“The line was so long that it extended from the underground parking lot to the road outside,” she said.The heat wave has scorched China for more than two months, stretching from Sichuan in the southwest to the country’s eastern coast and sending the mercury above 104 degrees on many days. In Chongqing, a sprawling metropolis in the southwest with around 20 million people, the temperature soared to 113 degrees last week, the first time such a high reading had been recorded in a Chinese city outside the western desert region of Xinjiang.The searing heat set off wildfires in the mountains and forests on Chongqing’s outskirts, where thousands of firefighters and volunteers have worked to put out blazes. Residents said the air smelled of acrid smoke.The drought has dried up dozens of rivers and reservoirs in the region and cut Sichuan’s hydropower generation capacity by half, hurting industrial production. Volkswagen closed its sprawling, 6,000-employee factory in Chengdu for the past week and a half, and Toyota also temporarily suspended operations at its assembly plant.A villager attempting to put out a bush fire with a mop in his field during a drought in Xinyao, a village in Jiangxi Province, on Thursday.Thomas Peter/ReutersFoxconn, the giant Taiwanese electronics manufacturer, and CATL, the world’s largest maker of electric car batteries, have both curtailed production at factories in the vicinity.In Ezhou, a city in central China near Wuhan, the Yangtze River is now at its lowest level for this time of year since record-keeping began there in 1865. People’s Daily, the main newspaper of the Communist Party, reported on Aug. 19 that the Yangtze River had fallen to the same average level it normally reaches at the end of the winter dry season.Read More About Extreme WeatherRelics of the Past: As a drought starves Europe’s rivers and brings water levels down, shipwrecks, bombs and objects dating back thousands of years are turning up at the water’s surface.Preparing for Disaster: With the cost and frequency of weather-driven disasters on the rise,  taking steps to be ready financially is more crucial than ever. Here are some tips.Wildfires Out West: California and other Western states are particularly prone to increasingly catastrophic blazes. There are four key factors.Colorado River: With water levels near their lowest point ever, Arizona and Nevada faced new restrictions on the amount of water they can pump out of the river.But the disruptions from the hydropower shortfall are being felt far from the southwest, including in China’s eastern cities, which are buyers of hydropower. Some factories and commercial buildings in cities like Hangzhou and Shanghai are rationing electricity.Kevin Ni, an online marketing worker in Hangzhou, said that his office was stifling because few air-conditioners were allowed to run.“We have to eat ice pops and drink iced drinks,” he said. “I just put my hands on the ice pops, that cools me the most.”A satellite image showing the Yangtze River last August between Huanggang and Ezhou, in Hubei Province, China.Planet LabsThe same view this month, showing how much lower the water levels are than in the previous year.Planet LabsThe falling water levels in major rivers that serve the region’s main transport hubs have also led to delays elsewhere in the supply chain. The Yangtze River has receded so much that many oceangoing ships can no longer reach upstream ports. The upper Yangtze basin normally gets half its entire annual rainfall just in July and August, so the failure of this year’s rains may mean a long wait for more water.That is forcing China to divert large numbers of trucks to carry their cargo. A single ship can require 500 or more trucks to move its cargo.“We’re losing a few months of really efficient shipping,” said Even Rogers Pay, a food and agriculture analyst at Trivium, a Beijing consulting firm.The heat wave and drought are also starting to drive food prices higher in China, especially for fruit and vegetables. Farmers’ fields and orchards are wilting. Sichuan is a leading grower in China of apples, plums and other fruit, and fruit trees that die could take five years to replace. The price of bok choy, a popular cabbage, has nearly doubled in Wuhan this month.“That’s going to create more economic pain, which is the last thing the leadership wants to see,” Ms. Pay said.Ships sailing on the Yangtze River in Jiujiang, Jiangxi Province, on Tuesday. The Yangtze River has receded so low that many oceangoing ships can no longer reach upstream ports.Alex Plavevski/EPA, via ShutterstockThe Ministry of Agriculture and Rural Affairs and four other departments issued an emergency notice warning on Tuesday that the drought posed a “severe threat” to China’s autumn harvest. China’s cabinet on Wednesday approved $1.5 billion for disaster relief and assistance to rice farmers and another $1.5 billion for overall farm subsidies.The government has urged local officials to seek out more water sources and allocate more electricity to support farmers and promote the planting of leafy vegetables, which are highly perishable, in big cities. Fire trucks have been used to spray water on fields and deliver water to pig farms.The extreme weather sweeping across China also has potential implications for the world’s efforts to halt climate change. Beijing has sought to offset at least part of the lost hydropower from the drought by ramping up the use of coal-fired power plants. China’s domestic mining of coal has been at or near record levels, and customs data shows that its imports of coal from Russia reached a new high last month.But China’s reliance on the fossil fuel raises questions about its commitment to slowing the growth of its carbon emissions.“In the short term in China, the very, very painful realization is that only coal can serve as the base” for the electricity supply, said Ma Jun, the director of the Institute of Public and Environmental Affairs, a Beijing environmental group. Sichuan Province has lured energy-intensive industries like chemical manufacturing for many years with extremely low electricity prices, he said, and some of these industries have squandered power through inefficiency.A dry vegetable plot at a farm in Longquan, a village in Chongqing.Mark Schiefelbein/Associated PressMr. Ma struck an optimistic note, however, about the direction of China’s climate strategy, saying that in the medium term, “China is very committed to carbon targets and renewable energy.”The government has sought to mitigate the effects of global warming on its economy. The National Development and Reform Commission, China’s top economic planning ministry, set up a working group last winter to analyze the effects of climate change on water-related industries like hydroelectric dams.While such efforts may help China preserve the viability of renewable energy programs, they may not prompt China to limit the burning of coal this year as a quick fix, said Ed Cunningham, the director of the Asia Energy and Sustainability Initiative at the Harvard Kennedy School.“They’re much more comfortable with coal,” Mr. Cunningham said, “and the reality is that when there’s a shortage of hydro, they use coal.”Muyi Xiao More

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    Pace of Climate Change Sends Economists Back to Drawing Board

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    Economists have been examining the impact of climate change for almost as long as it’s been known to science.In the 1970s, the Yale economist William Nordhaus began constructing a model meant to gauge the effect of warming on economic growth. The work, first published in 1992, gave rise to a field of scholarship assessing the cost to society of each ton of emitted carbon offset by the benefits of cheap power — and thus how much it was worth paying to avert it.Dr. Nordhaus became a leading voice for a nationwide carbon tax that would discourage the use of fossil fuels and propel a transition toward more sustainable forms of energy. It remained the preferred choice of economists and business interests for decades. And in 2018, Dr. Nordhaus was honored with the Nobel Memorial Prize in Economic Sciences.But as President Biden signed the Inflation Reduction Act with its $392 billion in climate-related subsidies, one thing became very clear: The nation’s biggest initiative to address climate change is built on a different foundation from the one Dr. Nordhaus proposed.Rather than imposing a tax, the legislation offers tax credits, loans and grants — technology-specific carrots that have historically been seen as less efficient than the stick of penalizing carbon emissions more broadly.The outcome reflects a larger trend in public policy, one that is prompting economists to ponder why the profession was so focused on a solution that ultimately went nowhere in Congress — and how economists could be more useful as the damage from extreme weather mounts.A central shift in thinking, many say, is that climate change has moved faster than foreseen, and in less predictable ways, raising the urgency of government intervention. In addition, technologies like solar panels and batteries are cheap and abundant enough to enable a fuller shift away from fossil fuels, rather than slightly decreasing their use.Robert Kopp, a climate scientist at Rutgers University, worked on developing carbon pricing methods at the Department of Energy. He thinks the relentless focus on prices, with little attention paid to direct investments, lasted too long.“There was an idealization and simplification of the problem that started in the economics literature,” Dr. Kopp said. “And things that start out in the economics literature have half-lives in the applied policy world that are longer than the time period during which they’re the frontier of the field.”Carbon taxes and emissions trading systems have been instituted in many places, such as Denmark and California. But a federal measure in the United States, setting a cap on carbon emissions and letting companies trade their allotments, failed in 2010.What’s in the Inflation Reduction ActCard 1 of 8What’s in the Inflation Reduction ActA substantive legislation. More

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    Analysis Deems Biden’s Climate and Tax Bill Fiscally Responsible

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    Despite Republican claims, the new legislation would be only a modest corporate tax increase, Congress’s Joint Committee on Taxation found.After more than a year of trying — and failing — to pack much of President Biden’s domestic agenda into a single tax-and-spend bill, Democrats appear to have finally found a winning combination. They’ve scrapped most of the president’s plans, dialed down the cost and focused on climate change, health care and a lower budget deficit.As soon as party leaders announced that new bill last week, Republicans began attacking it in familiar terms. They called it a giant tax increase and a foolish expansion of government spending, which they alleged would hurt an economy reeling from rapid inflation.But outside estimates suggest the bill would not cement a giant tax increase or result in profligate federal spending.An analysis by the Joint Committee on Taxation, a congressional nonpartisan scorekeeper for tax legislation, suggests that the bill would raise about $70 billion over 10 years. But the increase would be front-loaded: By 2027, the bill would actually amount to a net tax cut each year, as new credits and other incentives for low-emission energy sources outweighed a new minimum tax on some large corporations.That analysis, along with a broader estimate of the bill’s provisions from the nonpartisan Committee for a Responsible Federal Budget, suggests that the legislation, if passed, would only modestly add to federal spending over the next 10 years. By the end of the decade, the bill would be reducing federal spending, compared with what is scheduled to happen if it does not become law.And because the bill also includes measures to empower the Internal Revenue Service to crack down on corporations and high-earning individuals who evade taxes, it is projected to reduce the federal budget deficit over a decade by about $300 billion.Adding up the headline cost for what Democrats are calling the Inflation Reduction Act is more complicated than it was for many previous tax or spending measures that lawmakers approved. The bill blends tax increases and tax credits, just as Republicans did when they passed President Donald J. Trump’s signature tax package in 2017. But it also includes a spending increase meant to boost tax revenues and a spending cut meant to put more money in consumers’ pockets.Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, said the composition of the deal was vastly different from a larger bill that Democrats failed to push through the Senate in the fall. It included several spending programs that were set to expire after a few years, and budget hawks warned that the overall package would add heavily to federal debt if those programs were eventually made permanent, as Washington has been known to do, without offsetting tax increases.Ms. MacGuineas called the original idea, known as Build Back Better, “a massive gimmicky budget buster.” She had kinder words for the new package, saying it “manages to push against inflation, reduce the deficit, and, once fully phased in, it would actually cut net spending, without raising net taxes.”“That is a pretty monumental improvement,” she added.The bill springs from an agreement between Senator Chuck Schumer of New York, the majority leader, and Senator Joe Manchin III of West Virginia, a key centrist Democrat. President Biden blessed it last week, and it carries what remains of what was once his $4 trillion domestic agenda.Understand What Happened to Biden’s Domestic AgendaCard 1 of 7‘Build Back Better.’ More

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    Climate Change Is Probably a Drag on Growth, but It’s Unclear How Much

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    It’s been hot out there. Like water-main-breaking, train-slowing, corn-scorching, road-buckling hot — not to mention heat’s effects on human bodies, making it harder to work in construction and harvest crops.All of that must be playing into the gross domestic product reading for the second quarter, right?The short answer is yes. The longer answer is that it’s very hard to track that impact in real time, but economists are working on doing it better.For more than a decade, researchers have constructed forecasts of climate change’s likely economic impact. A 2018 paper found, for example, that the annual growth rate of state-level economic output declined 0.15 to 0.25 percentage points for every degree the average temperature crept higher in the summer — which could take up to a third off economic growth over the next century. And that’s just in the United States.Those estimates, however, benefit from long-term data sets that allow analysts to compare the effects of temperature and extreme weather events over time. They also tend to project further into the future, which generally yields more eye-popping outcomes, and is more relevant for evaluating the effects of policy interventions meant to curb emissions.“As a profession, we’ve been really focused on future economic impacts from climate change, because we’ve been focused on how you should be taxing carbon emissions,” said Derek Lemoine, an associate professor of economics at the University of Arizona. “We’ve been less focused on what climate change is doing already, partly because we didn’t realize it would happen this quickly.”But Dr. Lemoine is working on doing exactly that, with the goal of estimating how climate change is affecting the economy at nearly the same time that statistics like G.D.P. are being compiled.Other researchers are working on developing measures of economic growth that integrate not just production of goods and services — which themselves can accelerate climate change — but environmental and social elements as well. More

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    Why the U.S. Can’t Quickly Wean Europe From Russian Gas

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    The Biden administration’s plan to send more natural gas to Europe will be hampered by the lack of export and import terminals.HOUSTON — President Biden announced Friday that the United States would send more natural gas to Europe to help it break its dependence on Russian energy. But that plan will largely be symbolic, at least in the short run, because the United States doesn’t have enough capacity to export more gas and Europe doesn’t have the capacity to import significantly more.In recent months, American exporters, with President Biden’s encouragement, have already maximized the output of terminals that turn natural gas into a liquid easily shipped on large tankers. And they have diverted shipments originally bound for Asia to Europe.But energy experts said that building enough terminals on both sides of the Atlantic to significantly expand U.S. exports of liquefied natural gas, or L.N.G., to Europe could take two to five years. That reality is likely to limit the scope of the natural gas supply announcement that Mr. Biden and the European Commission president, Ursula von der Leyen, announced on Friday.“In the near term there are really no good options, other than begging an Asian buyer or two to give up their L.N.G. tanker for Europe,” said Robert McNally, who was an energy adviser to former President George W. Bush. But he added that once sufficient gas terminals were built, the United States could become the “arsenal for energy” that helps Europe break its dependence on Russia. Friday’s agreement, which calls on the United States to help the European Union secure an additional 15 billion cubic meters of liquefied natural gas this year, could also undermine efforts by Mr. Biden and European officials to combat climate change. Once new export and import terminals are built, they will probably keep operating for several decades, perpetuating the use of a fossil fuel much longer than many environmentalists consider sustainable for the planet’s well-being.For now, however, climate concerns appear to be taking a back seat as U.S. and European leaders seek to punish President Vladimir V. Putin of Russia for invading Ukraine by depriving him of billions of dollars in energy sales.The United States has already increased energy exports to Europe substantially. So far this year, nearly three-quarters of U.S. L.N.G. has gone to Europe, up from 34 percent for all of 2021. As prices for natural gas have soared in Europe, American companies have done everything they can to send more gas there. The Biden administration has helped by getting buyers in Asian countries like Japan and South Korea to forgo L.N.G. shipments so they could be sent to Europe.The United States has plenty of natural gas, much of it in shale fields from Pennsylvania to the Southwest. Gas bubbles out of the ground with oil from the Permian Basin, which straddles Texas and New Mexico, and producers there are gradually increasing their output of both oil and gas after greatly reducing production in the first year of the pandemic, when energy prices collapsed.But the big problem with sending Europe more energy is that natural gas, unlike crude oil, cannot easily be put on oceangoing ships. The gas has to first be chilled in an expensive process at export terminals, mostly on the Gulf Coast. The liquid gas is then poured into specialized tankers. When the ships arrive at their destination, the process is run in reverse to convert L.N.G. back into gas.A large export or import terminal can cost more than $1 billion, and planning, obtaining permits and completing construction can take years. There are seven export terminals in the United States and 28 large-scale import terminals in Europe, which also gets L.N.G. from suppliers like Qatar and Egypt.Some European countries, including Germany, have until recently been uninterested in building L.N.G. terminals because it was far cheaper to import gas by pipeline from Russia. Germany is now reviving plans to build its first L.N.G. import terminal on its northern coast.A pier in Wilhelmshaven, Germany, the port where Uniper, a German energy company, wanted to build a liquified natural gas terminal before it was shelved. Now Germany is reviving plans to build it.The New York Times“Europe’s need for gas far exceeds what the system can supply,” said Nikos Tsafos, an energy analyst at the Center for Strategic and International Studies in Washington. “Diplomacy can only do so much.”In the longer term, however, energy experts say the United States could do a lot to help Europe. Along with the European Union, Washington could provide loan guarantees for U.S. export and European import terminals to reduce costs and accelerate construction. Governments could require international lending institutions like the World Bank and the European Investment Bank to make natural gas terminals, pipelines and processing facilities a priority. And they could ease regulations that gas producers, pipeline builders and terminal developers argue have made it more difficult or expensive to build gas infrastructure.Charif Souki, executive chairman of Tellurian, a U.S. gas producer that is planning to build an export terminal in Louisiana, said he hoped the Biden administration would streamline permitting and environmental reviews “to make sure things happen quickly without micromanaging everything.” He added that the government could encourage banks and investors, some of whom have recently avoided oil and gas projects in an effort to burnish their climate credentials, to lend to projects like his.“If all the major banks in the U.S. and major institutions like BlackRock and Blackstone feel comfortable investing in hydrocarbons, and they are not going to be criticized, we will develop $100 billion worth of infrastructure we need,” Mr. Souki said.A handful of export terminals are under construction in the United States and could increase exports by roughly a third by 2026. Roughly a dozen U.S. export terminal projects have been approved by the Federal Energy Regulatory Commission but can’t go ahead until they secure financing from investors and lenders.“That’s the bottleneck,” Mr. Tsafos said.Roughly 10 European import terminals are being built or are in the planning stages in Italy, Belgium, Poland, Germany, Cyprus and Greece, but most still don’t have their financing lined up.The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More

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    A Top A.F.L.-C.I.O. Official Joins Greenpeace USA

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    The move by Tefere Gebre, the No. 3 official at the A.F.L.-C.I.O., highlights what many labor and environmental officials say is a need to cooperate.Signaling the growing importance of ties between labor and environmental organizers on climate change, the A.F.L.-C.I.O.’s third-ranking official has announced that he was leaving to join Greenpeace USA.The official, Tefere Gebre, the labor federation’s executive vice president, will become chief program officer for the environmental group on Tuesday. He will oversee all of Greenpeace USA’s campaigns, communications, direct action and organizing and report to the group’s co-executive directors.“I’m not leaving the workers’ movement — I’m bringing workers to the environmental movement,” Mr. Gebre said in an interview.Labor and environmental groups have forged alliances to reduce carbon emissions while providing a safety net for workers whose livelihoods are threatened by the shift and ensuring that green jobs will pay well. But these coalition-building efforts have occasionally hit snags that have hobbled climate legislation like President Biden’s Build Back Better bill, which is stalled in the Senate.Mr. Gebre will continue those efforts, while taking a leading role on other issues related to environmental justice, like elevating the focus on people of color affected by pollution.“I care about little kids in the 110 corridor in Los Angeles without a vote of their own, who wake up with asthma,” he said, referring to the area of South Los Angeles along Interstate 110. “They have nothing to do with polluting the environment, but they pay the price for it. We have to make it a movement for them.”An independent organization affiliated with the international Greenpeace network, Greenpeace USA employs about 150 people with an annual budget of $50 million to $60 million, largely from the organization’s three million members.Among the group’s prominent campaigns, said Annie Leonard, the co-executive director who helped recruit Mr. Gebre, are one focused on democracy, such as protecting the right to protest amid a flurry of bills that could threaten it, and another focused on protecting oceans. Mr. Gebre will oversee all of that work.At the A.F.L.-C.I.O., Mr. Gebre worked extensively on community and civil rights issues and was a key liaison to environmental groups, but he said he had often become frustrated by the lack of enthusiasm of powerful union presidents.Internally, he said, he argued that the looming migration of hundreds of millions of people because of climate change could lead to xenophobia, right-wing populism and increasing authoritarianism and that climate was therefore a top priority for the labor movement.“Our movement will never grow under authoritarianism,” he said, adding, “Everyone shook their head, but there was no action.”Mr. Gebre, who was born in Ethiopia, came to the United States as a teenager after escaping to a refugee camp in Sudan in 1983. He rose to become the executive director of the Orange County Labor Federation in California, and has been executive vice president of the A.F.L.-C.I.O. since 2013.As a top A.F.L.-C.I.O. official, he often clashed with members of the inner circle of Richard Trumka, the longtime president, who died in August. Mr. Gebre said he believed that the federation focused too much on electoral and legislative politics and not enough on movement-building and organizing, and that the labor movement was underinvesting in key industries like technology.Officials including Liz Shuler, the current president, have said that the choice between organizing versus political objectives like passing pro-labor legislation is a false one, and that the federation needs to succeed at both.“We are incredibly grateful for Tefere’s service and leadership as executive vice president,” Ms. Shuler said in a statement. “He understands that worker rights and climate justice can only be achieved together, and we will work closely with him in his new role.” More