With the $1.9 trillion COVID relief bill signed into law, Senate Majority Leader Chuck Schumer (D-NY) is ready to tackle the next major challenge: President Joe Biden’s call for a massive infrastructure bill. As part of that package, Schumer said he plans to include his ambitious proposal to get every American to swap their gas-guzzling car for an electric one.
“It’s a bold new plan designed to accelerate America’s transition to all electric vehicles on the road, to developing a charging infrastructure, and to grow American jobs through clean manufacturing,” Schumer told The Verge in a brief interview this week. “And the ultimate goal is to have every car manufactured in America be electric by 2030, and every car on the road be clean by 2040.”
The top-line details of the “cash for clunkers’’-style plan haven’t changed much since Schumer first proposed it in an op-ed in The New York Times in late 2019. But the political landscape has certainly shifted in favor of the Democrats, breathing new life into the idea. Under the proposal, anyone who trades in their gas car for an electric one would get a “substantial” point-of-sale discount, Schumer says. He wouldn’t say how much of a discount, only that it would be “deep.” A spokesperson later confirmed they are eyeing rebates that are “more generous” than the current $7,500 federal EV tax credit.
Schumer wouldn’t say how much of a discount, only that it would be “deep”
He also wants to provide direct incentives to auto manufacturers to phase out their production of internal combustion engine vehicles and tax breaks for property owners to install EV chargers at their homes or apartment buildings. Lastly, he proposes to send direct subsidies to local governments to improve and expand the nation’s network of EV charging stations. Schumer would deploy $45 billion in grants to upgrade the nation’s charging infrastructure and $17 billion to encourage manufacturers to retrofit their facilities for EV production.
There are still details to work out, such as how much of a discount to give each person who trades in a car, and how to structure the plan so the lowest-income earners receive the most cash back. Schumer estimates that the plan will cost $454 billion over 10 years to implement, compared to the $2 trillion Biden has said he would spend on his infrastructure and climate proposal.
Biden would probably be agreeable to Schumer’s plan — there are elements of it already included in the president’s Build Back Better proposal — though a spokesperson for the White House did not respond to a request for comment. Since taking office, Biden has signed an executive order to replace the government’s fleet of almost 650,000 vehicles with all-electric models produced in the US. And he pledged to spend billions of dollars to add over half a million EV charging stations in the US.
Given those facts, Schumer’s convinced that Biden will be an easy sell. “I haven’t sat down and discussed the whole thing with them,” Schumer said of the White House, “but yes, I think it is going to be part of the infrastructure plan.”
Since first announcing the plan, Schumer has sought out support from labor unions and auto manufacturers. So far, three powerful labor unions have endorsed the plan: the AFL-CIO, UAW, and IBEW. With their buy-in, the majority leader is convinced that the proposal will have an easier path to approval, even with Republicans largely opposed to anything that originates from a Democrat’s desk. Still, he’s optimistic that he can peel away a few Republican votes, thanks to broad support for electrification from the auto industry.
“I’m excited by the substance of the proposal,” Schumer said, “but I’m also excited by the politics.”
“I’m excited by the substance of the proposal, but I’m also excited by the politics.”
There has been criticism by transit advocates who would rather see that sum of money spent on strengthening the nation’s public transportation infrastructure, especially at a time when the COVID-19 pandemic has caused a huge drop-off in ridership. (The recently approved American Rescue Plan of 2021 includes $30.5 billion for transit.) The government shouldn’t be spending money on incentives for car purchases, regardless if they’re electric, they argue, when congestion and sprawl are such major contributors to greenhouse gas emissions.
Schumer said he’s working on a “large investment in clean mass transit” right now, which he also hopes to include as part of the Democratic infrastructure proposal. “Transit is an integral part of the way to revolutionize the way we move around,” he said, though he declined to say whether more money should be spent on public transportation than his gas-for-electric swap idea. “I’m not going to compare. We need to do both.”
Another potential problem for Schumer’s plan is the current state of the electric grid in the US. Electric vehicles are only as green as their power source, and according to the US Energy Information Administration, 38 percent of the nation’s power supply comes from natural gas, 23 percent comes from coal, 20 percent from nuclear power, and only 17 percent from renewable sources like wind, solar, and hydroelectric.
Schumer noted that while his proposal doesn’t specifically address the electrical grid, he is a co-sponsor of the THRIVE Act, which calls for federal investments to boost renewable energy. Included among the 83 co-sponsors are Sen. Ed Markey (D-MA) and Rep. Alexandria Ocasio-Cortez (D-NY), co-authors of the Green New Deal.
The progressive wing of the Democratic Party has pushed to get Schumer to sign on to the Green New Deal, but he says he prefers his alternative approach. “The THRIVE agenda is a practicalization of the Green New Deal,” Schumer said.
Schumer also wouldn’t go so far as to say he would support a federal ban on the sale of gas-powered vehicles. The European Union has said it wants to phase out gas car sales by 2035, with some nations like Ireland, Sweden, and the Netherlands saying they would ban the sale of new gas cars much sooner, by 2030. A number of US states have signed on to similar timelines, including California, the largest auto market in the country.
Major auto producers have also said they would sell only electric vehicles within the next 10 to 15 years, including Ford, General Motors, Volvo, Volkswagen, and others. But Schumer declined to say whether he would support a national plan to phase out the sale of gas-powered cars, saying he prefers using a carrot rather than a stick.
“Our proposal will do the most that can be passed,” he said. “My goal is to pass into law the boldest change, and I think this is sort of the sweet spot where that is.”
“Our proposal will do the most that can be passed.”
Today, anyone who buys an electric car is eligible for a $7,500 federal tax credit in addition to any local tax credits that exist at the state level, depending on where they live. The incentive was created by the Obama administration in 2009 to encourage automakers to embrace electrification. It was also meant to help consumers offset the price of a new EV, many of which were (and still are) too expensive for most Americans.
But the credit was never meant to be permanent, and a cap of 200,000 vehicles sold was included. Once a car company passes that mark, the tax credit slowly phases out over a period of 18 months. In recent years, both Tesla and GM have hit the 200,000-vehicle threshold and have begun to phase out the credit. But Schumer says the tax credit is targeted at “affluent” people, whereas his plan applies to everyone across the economic spectrum, including “people who don’t pay taxes.”
Electric cars aren’t the only battery-powered vehicles that are changing the way people get around. Electric scooters and bikes have exploded in popularity in recent years, with environmental advocates touting them as an even greener mode of transportation than EVs. A bill was recently introduced in the House of Representatives that would give a refundable tax credit of 30 percent on the purchase of a new e-bike, which Schumer says he would support.
“I would like to look at the broad range of transportation,” he said. “We’re looking at mass-transit buses and subways right now. And I’d like to make it as expansive as possible — scooters, everything. I’m a bicycle rider. Obviously, that’s very clean.”
He added, “Things like that, we’d like to expand and incentivize.”