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These are key provisions in the biggest climate change bill in history- Tax credits that last for over a decade for zero carbon plants- these tax credits go to companies that build new sources of emissions free electricity, for wind turbines, solar panels, battery storage, geo thermal plants. Tax credits also for new technologies that capture and bury carbon dioxide from natural gas plants and industrial facilities before it escapes into the atmosphere and heats the planet. This technology is rarely used because of high costs. Incentives for electric vehicles- It extends a tax credit of $7500 for new electric vehicles. It adds a $4000 tax credit for used electric vehicles. Tax credit goes only to people earning $150,000 a year (300,000 for joint filers) for new EV's and $75,000 (150,000 for joint filers) for used EV's. Help for people to lower energy costs - $9 billion in rebates for Americans installing energy efficient electrical appliances. And a decade of tax credits for Americans installing rooftop solar, heat pumps, water heaters and electric HVAC, or electric heating, air conditioning and ventilation technologies. Investments in Domestic Manufacturing- $60 billion for investments in clean energy manufacturing in the US. This includes $30 billion for production tax credits for solar panels, wind turbines, batteries and critical minerals processing. $10 billion in investment tax credits to build manufacturing facilities for electric cars and renewable energy technologies. This action is to halt the shifting of clean energy manufacturing overseas to China. $27 billion towards a green bank that would finance clean energy projects in disadvantaged communities. Cracking down on Methane- the bill places a fine on methane gas emissions from oil and gas wells and pipelines and other infrastructure. Fees of $900 per metric ton in 2024 and $1500 a metric ton in 2026 when it exceeds federally set limits.    ...

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Koch Industries which is built on oil is investing heavily in electric batteries. The company has made 10 investments of over 750 million dollars in the US battery supply chain and electric vehicles in 2021-2022. This money is coming at a critical time for many new battery company startups.

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The UAW settlement covered a range of areas setting out a roadmap for other unions. It included getting companies to reinvest in plants and communities where they were pulling out- the Belvidere Illinois plant which Stellantis had planned to close, instead agreeing to hire 1000 more workers for an electric vehicle factory and a parts distribution center, an investment of $4.8 billion. Workers worked long hours during the pandemic- the UAW negotiated for shorter work weeks including 4 day workweek for the health of workers.

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The EV strategy of Toyota's new CEO Koji Sato is to make large upfront investments in EV dedicated parts and manufacturing methods. Koji Sato says "We've seen the kinds of EV's we're aiming for. Now that the timing is right, we will accelerate that development with a new approach." Under the former CEO Akio Toyoda Toyota fell behind in electric vehicles, as competitors surged ahead.

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In 2023 there are 4.3 million electric vehicles on American roads and 150,000 public charging ports. President Biden's goal is for 50% of cars to be EV's by 2030 with 500,000 public charging ports. The National Renewable Energy Laboratory affiliated with DOE forecasts need for 1 million charging ports. Ohio and Pennsylvania are leading the way in a slow start with other states joining in. A single public charging port can cost about $150,000. It will cost $31 billion to $55 billion to build the public portion of a national charging network. About $24 billion is planned investment.

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President Biden meets newly elected South Korean president Yoon Suk-yeol on his visit to South Korea. During the visit Biden also promoted South Korean investments in Texas and Georgia. He visited a Samsung semiconductor plant with the president of Samsung. Samsung is investing billions of dollars $10 billion for a new electric vehicle plant in Savannah, Georgia. By getting American semiconductor and electric car manufacturers to invest heavily in the US president Biden is changing how America invests for regaining technological leadership by 2030. In an effort to get plants to support unions president Biden called for the plants to hire union workers. Biden called by name two Senate contestants in upcoming Georgia elections for their efforts in getting the Hyundai plant that will hire 8000 workers. In contrast to Mr. Trump who lacked a plan or vision for the future Mr. Biden is keenly focused on getting South Korea, Japan and Germany to invest heavily in the US and help restructure the whole supply chain. Where Mr. Trump called for South Korea and other partners to share the defense burden, Mr. Biden is focused on getting American allies to have their large companies invest in American plants and jobs and a new supply chain. ...

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The role of the former Rhode Island governor Gina Raimondo, as Commerce Secretary. She pushed forward the CHIPS and Science Act through Congress securing votes from 17 Republicans and all except one Democrat in the House of Representatives. She is committed to moving fast on issues such as investments in America. Gina Raimondo believes that "the most important thing to do to compete with China is to invest in America." She says in an interview that America needs to dominate in certain areas of technology, including critical materials, electric vehicle batteries, semiconductors, artificial intelligence. This report looks at her role at the Commerce department and her relationships with president Biden, Congress, and foreign leaders including Piyush Goyal who is Minister for Industry in India.
 

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Washington Post reporters Clement and Gushkin with research and polling experience at Pew Research Center give the results of the Post-ABC News poll taken before the State of the Union 2023 address by president Biden. It shows what president Biden has said about his  investment spending of trillions of dollars in America's crumbling infrastructure, in new manufacturing for chips, advanced technologies, R&D, electric charging stations, EV vehicles, renewable energy. "Folks we are just getting started." The investments are taking place quickly because today there many projects ready for investment. Yet it takes time for the manufacturing plants to be built, new expressways and bridges to be built. The poll shows not enough people know- only a third of people know about two thirds do not know. That Mr.Biden is aware of this is apparent. He says-"It is one thing to have passed it all- now we have to make sure we're on it every single day. Not a joke." And on Jan 26, saying "Implementing it so people can see what we've delivered and give it to them directly."  This is why president Biden used his State of the Union address to make the points directly to the American people. This is also seen in his recent speech to a union audience when he told workers- Mr. Trump used infrastructure as a punchline, Biden turned it into a decade only headline. Creating well paying jobs and doing this while cutting the deficit by trillions of dollars. To give the contrast Mr. Biden told workers and working families the spending cuts proposed by the Republican House of Representatives were according to Moody's likely to result in a loss of 780,000 jobs.    ...

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The VW emissions scandal lingers on five years after the rigging of of millions of diesel vehicles to cheat emissions tests. Now former CEO Martin Winterkorn is ordered to face trial on charges of defrauding customers. It is interesting to note how it all started was a grandiose ambition set by Winterkorn according to this report in the WSJ, to make VW the largest auto company in the world ahead of Toyota and General Motors and push sales of diesel vehicles in the U.S. with "clean diesel vehicles." At this time of pandemic it is appropriate to note that the world has changed since 1946 when the wages of top managers were 2 times that of a Caterpillar company worker, and reached level of 400 times a worker for some executives of companies before the pandemic.  Even in supposedly egalitarian countries where worker representatives are on boards such as Germany, the wages had pushed way upwards to about 170 times the salary of the average worker at VW in 2015 when the emissions crisis erupted. This VW episode shows that the grandiose ambitions of executives were another part of the problem before the pandemic. Today the VW disaster has led to a completely opposite result. Diesel is not taking over the U.S. it is now the now the no go in Germany, as diesel vehicles are being phased out. Instead Germany's auto industry is now making large investments in the electric car industry. Significantly chancellor Merkel and the CDU no longer see the automobile industry in Germany as having some kind of special status and the shift to electric is being made with the planned loss of jobs and a restructuring to replace lost jobs with other jobs over 10 years. And the SPD has called for a legal ratio of the average ratio of a company's top managers  in relation to a workers wage at the same company. The pandemic has put things in perspective on a number of fronts, from wage relationships, health, healthcare and wellbeing, healthy lifestyles, mental health, making clear that health and a commonsense idea of fairness, good infrastructure, and sensible wage relations all go together in this world that the creator made. ...

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In making his announcement to run for president in 2024 president Biden told a trade union audience that for Mr. Trump reviving American manufacturing was merely a punchline- not much happened. Krugman in this NYT report shows that Mr. Trump never acted seriously to directly make that happen. President Biden has passed legislation that creates trillions of dollars of investments in infrastructure, renewable energy, chips manufacturing, electric vehicles, and advanced manufacturing technologies. Krugman says in addition to what the government is spending private companies are also planning to invest trillions of dollars. As a result the US is in the process of building its manufacturing base for the first time after decades of neglect under the Reagan, Bush, Clinton, Obama and Trump administrations.  Economists have created a major handicap for investments in manufacturing with theories that are no longer relevant, and by their lack of understanding of the realities of workers and families in the US as manufacturing shriveled. They never figured into their analysis the loss of tax revenue base supported by factories in the US that led to disinvestment in towns and communities across the US. As public services and investment in these communities dwindled without the local revenues to support them. Mr. Krugman lacks the keen grasp of these issues that Biden as the longest serving Senator in the US has. Biden had so much time on the ground observing the situation in Scranton and other parts of Pennsylvania and Delaware, and much of the midwestern US seeing what happens first hand as factories close. Krugman is not able to make the case that manufacturing so truly needs. Yet even Krugman has some sense of the big changes underway in the US that Biden has created that will lead to the renewal of America. ...

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French president Macron fails to get president Xi of China to commit to changes in its policies towards Russia's invasion of Ukraine. Macron's visit as seen by the NYT only undermines the US policy and European Union policy that opposes the invasion of Ukraine by Russia. EU's Leyen also visits China at this time.  The relations between the US and European business with China expanded for two decades between 2000-2020. All three regions are heavily invested in each other. Decoupling is a gradual process and China sees the EU as an access point for technology and investment. The US has not decoupled from China even after moves in semiconductors and electric vehicles were made by president Biden. Apple and other American companies are heavily invested in China. The US and the EU are committed to building new supply chains. Their policies are intended to do this in a way that reduces the effect on their economies. The European Union depended on the US for its response to the Russian invasion and to protect freedom in Europe through NATO. By 2024 the European Union policies will be integrated with policy of the US. China is also trying to reduce the effect on its economy by decoupling in a way that maintains growth. ...

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Growth is back in the eurozone. The OECD estimates 2.1% growth in 2017 and 1.9% growth in 2018 for the eurozone countries. Business investment is up significantly- up 5.7% in the first half of 2017. Worldwide business investment in 2016 was at 1.3 trillion euros, up 7.2% from the prior year, according to Eurostat.

New investment for electric vehicles in the auto industry is also up significantly in an industry that provides 10% of all jobs in manufacturing. Yet business investment is only half of what it needs to be- to makeup 5% of GDP- to spur good job creation, says this report in the WSJ. Use of automation is also limiting the number of jobs created. Real wage growth is also lacking.

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Andy Kessler looks at the prospects for China's effort to dominate the market for advanced chips used in everyday devices, just as it did in solar panels and electric vehicle batteries.  He says Apple leaves US manufacturing technologies at a disadvantage by securing its M1 processor chip from Taiwan's TSMC. Intel has fallen behind in 10 nanometer chips and will need a few years says Kessler.  Kessler says Chinese threat to invade Taiwan which has made the US and the EU take a firmer stand on Ukraine poses a danger to TSMC which has 5 fabs or factories in just 1 science Park- Hsinchu Science Park. This poses a question is it safe to concentrate about 92% of the world's semiconductor production in one place Taiwan so close to the mainland of China? And knowing sit tight taking no action? Google's last chairman Eric Schmidt asks this question in the WSJ and calls for a new investments in the US to manufacture advanced semiconductors and other semiconductors for everyday use so that the US national security is protected. Even the $50 billion that is in Congressional legislation has yet to be approved by the US Congress, says Schmidt, showing that US Congress is not moving quickly to address this problem. South Korea and Taiwan including TSMC need to be told to make a large part of the semiconductors in the US and other locations such as India to diversify production. 92% of world semiconductors made in Taiwan that could be taken out with a few missiles, is no way to diversify manufacturing, when manufacturing can be done in India or other parts of the world with lower costs and with needed engineering manpower. ...

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The WSJ's Paul Sonne gives this exceptional account of how Russians are coping in the economic crisis of 2015-2016, with the twin shocks of the collapse in the ruble and the collapse in oil prices. He does this by looking at the Kaluga region, a provincial city 110 miles south of Moscow that has benefitted from large foreign investment to meet the needs of 20 million consumers in the Moscow region. The governor of Kaluga since 2000, Anatoly Artamonov, worked hard to attract foreign investment that includes VW, Volvo AG, Continental AG, Lafarge, Samsung Electronics, General Electric, and other companies. He ran a collective in the Brezhnev era, and now is energetic in meeting needs of foreign investors. Karmanov says it is stupidity to not say he is talking to business people in other parts of the world because of the political climate in the country. About 42% of the industrial output in Kaluga comes from the foreign automobile plants, including VW. The automobile and light commercial vehicle production in Feb. 2015 dropped by about 39% compared to Feb. 2014, according to the Association of European Business estimate. Only 40% of autombile production cost from assembly lines is sourced locally, the rest is imported at the new value of the ruble which has fallen about 50%, leading to higher prices and slumping demand. Ordinary Russians are feeling the effects of the crisis with higher prices. Consumer price inflation in Feb. 2015 was at 16.7%, with 23.3% increase in food prices. High interest rates to prop up the ruble meant cutting off access to credit to finance consumer purchases. An 8% drop in real wages in Jan. 2015, according to Capital Economics, added to pressures on consumers. With the political and economic crisis following Russia's Ukraine intervention foreign investment in 2014 declined to $18.6 billion in 2014 compared to $61.5 billion in 2013, and the EBRD bank cut financing with the sanctions....

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Pressed by tariffs from DJT China is trying to become technologically sufficient, yet this comes at a considerable cost, says this report in WSJ. Made in China 2025 was put out in 2014 when president Xi was beginning his plans for the Chinese economy. It is 2025 now and a look at the nation's investment plans show China putting $250 billion a year in advanced manufacturing sectors from automobiles to solar panels and AI, says Centre for Strategic and International Studies CSIS in Washington. This is giving China an edge but at the cost of using up valuable resources and some wasted spending at a time of stagnant government revenues. China's new production needs new markets with overcapacity such as in the electric automobile industry. This overcapacity comes at a cost when the US and other countries are restricting imports from China with new trade policies. During the DJT first term in 2016 China pulled back reference to make in China 2025 but this was temporary and China's 2021 Economic Plan puts top priority to be self sufficient in Science and Technology. Industrial support for EV's went from $15 billion in 2019 to $45 billion in 2023 (CSIS). 48% of 11 million new vehicles were EV's in 2024 with BYD and Geely the main ones of 100 brands. In shipbuilding $132 billion was invested in 2010-2018 taking China from 5% in 1999 to 48% of total manufacturing of shipbuilding in 2025 worldwide. The same is true for manufacturing aircraft and chemicals. ...

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Decades of investment in car manufacturing and EV's is paying off for China. It now exports 5.7 million cars of which 1.7 million are EV's. EV exports are twice that of Germany. Car production capacity in China surged as the Chinese market expanded to be larger than Europe and the US combined. The production capacity is twice the size of the domestic market- 40 million gasoline cars from 100 factories.  As domestic sales have slowed down there is a push for exporting this excess capacity. The US and the EU are imposing tariffs on Chinese cars to protect their domestic manufacturing. The push to become a leader dates back to premier Wen Jiabao 20003-2013. Wen chose Audi engineer Wan Gang as minister of science and technology, and gave him the task of making China the leader in electric vehicles. Manufacturers were given subsidies, tax breaks, cheap land and electricity. By one estimate the EV manufacturers and battery makers in China received $230 billion in subsidies since 2009.  This is one reason the EU and the US are imposing tariffs to protect their domestic manufacturers. As the shift to EV's continues in China- half of the cars in 2024 EV's- the gasoline models are shipped overseas. China has now replaced the western brands in Russia with it's gasoline models.  China makes great savings in batteries as it controls the supply chain in batteries. It makes EV's at 30% lower cost with these efficiencies. ...

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The $369 billion climate and tax package that is coming out of a deal arranged by Schumer in the US Senate could be a path breaking action. It would enable president Biden to get close to the climate goals he promised last year of cutting US carbon emissions by 50% by 2030 over 2005 levels to combat effects of climate change. The $369 billion package would get the US to reduce carbon emissions by 40% in 2030 over 2005 levels.  Severe effects of climate change with fires and floods in the US, Europe, and Asia have brought a new spotlight to the issues facing the world and the fact that something needs to be done quickly with the US leading the way. Senator Manchin a holdout because he comes from a coal mining state was a holdout. He was persuaded to join as the new legislation provides for support for transmission lines and other investment during a transition period so that it does not affect the economy in his state. The transition period is now accepted as Europe now looks at gas and coal as a temporary resource following the cutoff of Russian supplies and the US will be shipping more LNG to Europe during this period. The vote for this legislation is planned under reconciliation so that the vice president MS. Harris can cast the deciding vote for Democrats in a 50-50 split Senate. Republicans oppose the legislation. Manchin now says it will reduce inflation. Briefly it will give $7500 to every buyer of an electric vehicle EV, and $4000 for a used EV. It would give rebates for heat pumps that increase home energy efficiency. Billions of dollars would be spent for clean energy industries, and for solar, wind, geothermal, other renewable energy projects. Democrats want to get the legislation through the Senate quickly by next week, and so secret were Schumer's negotiations that most Democrats did not know about it. Coming on the heels of the $280 billion CHIPS and Science bill for $280 billion investment in US semiconductor industry, this will be a big win for president Biden and shows the persistence and patience of Mr. Biden is paying off.   ...

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GM will invest $3 billion in electric car production in Michigan. The Orion Assembly plant near Detroit  will produce electric pickup trucks- renovation costing $2 billion and bringing 1500 jobs. A new battery cell factory near Lansing would bring $2 billion in investment in 50-50 joint partnership with LG Energy Solutions creating 1200 jobs. Ford is investing in other states, with $11 billion investment in building 3 battery plants- 2 in Kentucky, one in Tennessee near Memphis. Tesla is investing in Austin, Texas. GM says it is revamping existing factories to save $10 billion through 2030. The new GM investments are part of $35 billion in spending on electric cars through 2025.  For the US as a whole these investments change the look of the auto industry from one that in the past put factories in China and Mexico for gas and diesel vehicles. The shift to electric is now being taken as an opportunity by the Biden administration to encourage auto companies to make a new beginning and speedily build the future electric car base in the homeland itself. So that American workers and families come first in the great American tradition. ...

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Harris focus on Detroit as plans to revive automobile manufacturing continue under the Biden administration. Detroit suburb Dearborn one of the centers of the automobile industry looks very different today as Ford makes major investments with the support of the Biden-Harris administration. A new EV electric vehicle industry is being created from scratch for the long term transformation.

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A large increase in fuel efficiency as planned by new EPA rules creates a different environment for electric cars. Current average fuel economy is 26. New rules that raise the average fuel economy to higher than 47 mpg will result in cars that conserve gasoline, reduce emissions, and make these vehicles more attractive to operate than electric cars on a cost basis, without sacrificing too much in conservation and emissions. A new study shows that achieving the increase to 47 mpg with new technologies will cost automakers about $2000 per vehicle. At $4.50 a gallon for gasoline it takes six years for a hybrid to be more cost effective than a 47 mpg car, according to this study. For a plug-in it would take 7 years and a pure electric vehicle 8 years. This suggests gasoline would have to cost more than $4.50 for electric cars to get an economic advantage. Technological breakthroughs and new technologies in electric cars which are a nascent industry at this time are not worked into these calculations. This could result in a different situation and favor the companies doing the pioneering effort to learn these technologies and develop cost effective solutions....

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Revised auto fuel efficiency standards win the support of GM, Ford, Chrysler, Honda and Hyundai. These standards would lower the average fuel economy to 54.5 miles per gallon by 2025, a decline from the initial target of 56.2 mpg. The revised proposal calls for a 5% average annual increase in fuel economy for cars and a 3.5% increase for light trucks through 2021. After 2021 both cars and trucks have to meet a 5% annual increase. Useful innovation in the new standards is to provide credits for hybrid pickup trucks, and give credits for technological advances that improve fuel economy but don't show up in EPA tests such as the one that shuts of the engine when a car is idling. Other credits would be offered for solar roof panels on electric vehicles. It includes incentives for "promoting early market penetration of tailpipe CO2/fuel consumption reducing technologies." This comes after a long period in which the U.S. lagged behind other countries in fuel economy. It could be one of the main achievements of the Obama administration, and help build a new auto industry around new technologies....