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Treasury Secretary Janet Yellen is delivering a stark warning to voters in North Carolina about the potential economic fallout if Republicans succeed in weakening a key Biden administration law. In a speech scheduled for Thursday at a community college in Raleigh, Yellen will emphasize the critical role of tax incentives provided under the 2022 Inflation Reduction Act (IRA) and the significant benefits they bring to states like North Carolina.
Ahead of her address, the Treasury Department released a draft of Yellen’s remarks, highlighting her concerns that rolling back these incentives would have dire consequences. According to Yellen, the state has seen substantial benefits from IRA provisions, including $100 million in residential clean energy credits and $60 million in energy efficiency credits claimed by more than 90,000 households.
“Rolling them back could raise costs for working families at a moment when it’s imperative that we continue to take action to lower prices,” Yellen states in her draft speech. “It could jeopardize the significant investments in manufacturing we’re seeing here and across the country, along with the jobs that come with them, many of which don’t require a college degree. And it could give a leg-up to China and other countries that are also investing to compete in these critical industries.”
North Carolina has become a key battleground in the presidential race, with President Biden’s vice-presidential running mate, Kamala Harris, facing off against Republican former President Donald Trump. Biden narrowly won the state in 2020, and its importance in the upcoming election cannot be overstated.
Yellen’s remarks come amidst a heated debate among Republicans about the future of the IRA’s tax incentives. Some GOP leaders have urged a reconsideration of efforts to repeal these incentives, citing concerns that a full repeal could undermine private investments and halt ongoing development projects.
A group of 18 House Republicans recently wrote to House Speaker Mike Johnson expressing their opposition to a complete repeal, arguing that it would lead to wasted taxpayer dollars and minimal returns.However, not all Republicans agree. Rep. Chip Roy, R-Texas, has criticized the incentives as “green handouts” benefiting corporate interests, accusing GOP lawmakers of preserving “climate corporate cronies.”
The IRS reported in August that 3.4 million American families have claimed $8.4 billion in clean energy and home efficiency tax credits in 2023, with significant allocations going towards solar panels and battery storage. Yellen’s speech aims to underscore the broader economic implications of these incentives, arguing that their removal could have far-reaching negative effects on both local and national levels.
As North Carolina remains a pivotal state in the upcoming election, Yellen’s warnings reflect the broader stakes involved in the ongoing debate over the IRA and its impact on the economy.