Opinion

The Trouble With Biden’s ‘Green Bank.’

Paul H. Tice

By Paul Tice

By Paul Tice

As lawmakers debate the size and scope of President Biden’s proposed infrastructure-related stimulus plan, not enough attention is being paid to some of the details. Consider the roughly 1% of the $2.3 trillion spending package designated to create a “Clean Energy and Sustainability Accelerator,” which would “mobilize private investment” in the “clean energy economy.”

Cut through the greenspeak, and the administration is proposing to establish a bank with a direct line to the U.S. Treasury that would serve as a permanent financing conduit channeling tax money to support and subsidize politically favored clean energy projects.

Competing bills are already working their way through both houses of Congress to set up such a new federal entity, variously referred to as a “United States Green Bank” and a “National Climate Bank.” Since Democratic lawmakers are effectively negotiating with themselves, the bidding has started higher than the White House’s request—$50 billion up front and $100 billion over time under one Senate version. The potential cost to the American public of such a green government spigot could easily increase nearly 40-fold over the $27 billion currently penciled into Mr. Biden’s American Jobs Plan.

Read the full The Wall Street Journal article.
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Paul Tice is an Adjunct Professor of Finance at NYU Stern.