The holidays traditionally place a strain on the budgets of many Americans, and the sporadic COVID-19 lockdowns throughout 2020 have only added to the struggle to make ends meet. As if those financial challenges were not enough, Joe Biden has more in store. Change is hard, to coin a phrase, and the kind of “clean energy revolution” he has in mind is likely to cost a pretty penny.
Gasoline prices are floating upward, though more the result of rising oil costs than the coming Biden presidency, which is still a month off. The cost of a gallon of regular unleaded has climbed 14 cents over the past month to an average of $2.25. Places in cheap-gas states like South Carolina, though, have seen a price jump of nearly a quarter in just one week.
Unexpected expenses are like the handiwork of light-fingered pickpockets, and the current end-of-year gas price hike may have the effect of acquainting Americans with what is to come during the next four years.
Treasury Secretary nominee Janet Yellen, a central player on the future Biden economic team, is an enthusiastic supporter of a national carbon tax proposal. If she has her way, its implementation would raise $2 trillion for the president-elect’s green-energy plans. A commonly cited starting point of $40 per metric ton of carbon dioxide could add 35 cents to a gallon of gas for American consumers.
California provides an ominous illustration of such a tax’s impact. The state sports a Low Carbon Fuel Standard, which adds a premium to the cost of fuels based on their carbon content. Unsurprisingly, gas in California currently costs around $3.20, a dollar more than the national average — by far the most expensive except for far-flung Hawaii.
Consumers frowning at the prospect of an end to the era of affordable fuel may dread even more of Mr. Biden’s determination to steer the nation toward a zero-emission economy. That means, in effect, joining California in phasing out internal combustion vehicles and plugging into a future driven by electric vehicles (EVs).
The coming transportation transformation has already made Tesla, Elon Musk’s electric-car company, worth more than $600 billion — more than the world’s top nine car companies combined. Electric cars are too pricey for regular folks, though — the base Model 3 Tesla starts at $36,200 and can only travel 250 miles before requiring a return trip for an overnight charge. Home is where Mr. Biden wants Americans to stay, anyway, with the door bolted against the frightening Chinese disease.
Besides the virus, China has another critical export: the lithium- and cobalt-suffused batteries that power the EVs. Disturbingly, it stands to profit handsomely from a move away from the fossil fuels that enabled the U.S. to become energy independent.
Americans could discover there are unforeseen costs associated with the Biden energy plan that make the rising price of gasoline seem like chump change.