News : The Cabinet secretary eager to fail

Thursday, April 15, 2021

The Cabinet secretary eager to fail

Apr 15, 2021

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By Michael Grunwald

Presented by

With help from Renuka Rayasam

WATCH — One day after announcing an end to the "forever war" in Afghanistan, President Joe Biden expelled 10 Kremlin diplomats from the U.S. and imposed new sanctions on the Russian government. Nightly's Renuka Rayasam talked to world and national security editor Ben Pauker about what we have learned so far about the shape of Biden's foreign policy.

GRANHOLM: FAILURE IS A PRETTY GOOD OPTION — Failure can be embarrassing. Failure can be expensive. And when it comes to green stimulus investments like the doomed solar firm Solyndra, failure can be politically toxic.

But failure can also be the price of change. As Biden pushes a $2.5 trillion infrastructure plan designed to accelerate America's transition to clean energy, his team knows there might be stumbles on the road to a greener future. His Energy secretary, Jennifer Granholm, likes to say that you can't hit the ball if you don't take a swing.

"Sometimes you swing and miss, and that's OK," Granholm said in an interview with Nightly. "In Silicon Valley, you put notches in your belt for failures. You just have to learn from them."

President Barack Obama's 2009 Recovery Act included an unprecedented $90 billion in green investments, and the only one most Americans remember was the busted $535 million loan to Solyndra. There was also voluminous coverage of failed stimulus recipients in the electric vehicle space — like automaker Fisker, battery manufacturer A123 and charging company Ecotality — as well as failed biofuel refineries and carbon-capture projects. The New York Times recently warned of Biden's plan that "the failures of the Obama stimulus, and Mr. Biden's role in them, could haunt the plan as it makes its way through Congress."

That may be true — but only because Congress, which relentlessly investigated Solyndra without uncovering any wrongdoing, and the news media, which focus more on planes and government investments that crash than the ones that land safely, have selective memories about the first green stimulus. Yes, Solyndra went bust, but the U.S. solar industry has expanded 50-fold since its 2009 jump-start. Yes, Fisker defaulted, but the same loan program helped save Tesla from bankruptcy.

Overall, the loan program turned a $2 billion profit for taxpayers, because it made far more good bets than bad ones. And overall, the stimulus launched America's clean-energy revolution, helping solar, wind, electric vehicles and LED lighting across the so-called "valley of death" for upstart industries facing entrenched incumbents. Many Republicans now attack all green investments as Solyndra-style crony capitalism, but the goal wasn't to pick winners and losers. The Obama stimulus boosted all kinds of green technologies, then let the market pick winners and losers. It turned out to be a pretty effective form of venture socialism.

Granholm was Michigan's governor when the stimulus financed several advanced battery factories in her state — including one for A123 before it went bankrupt, and another that made news because demand for electric cars was so feeble that its workers were watching movies on the shop floor. But the investments helped create a domestic electric vehicle industry from scratch. Granholm now drives a Chevrolet Bolt made in Michigan.

"We were a little ahead of our time in 2009, but we saw where the puck was going," she says. "We were just a bit faster than the puck, and there are lessons from that."

The Biden team does not think the lesson of 2009 is not to try: The White House plan includes nearly $1 trillion worth of green investments. And some of them do resemble the risky bets on unproven technologies that created headaches for Obama. There would be "demonstration projects" to convert hydrogen into energy; "pioneer facilities" to capture carbon at steel, cement and chemical factories; and similarly experimental efforts to commercialize floating wind farms, advanced nuclear reactors and other green gambles. Biden wants $300 billion just for manufacturing — and sometimes manufacturers fail.

But the Biden plan does emphasize policies that would avoid Solyndra-type busts — cleaning up abandoned coal mines, plugging orphaned oil wells, greening government agencies, forcing utilities to ditch fossil fuels through a clean electricity standard, and expanding existing tax credits for solar and electric vehicles.

One lesson Granholm says has been learned from 2009 is the folly of putting the cart of supply before the horse of demand. Ecotality's charging network predictably flopped before there were electric vehicles that needed charging. But now there are 1 million EVs on the American roads. The bulk of the Biden plan's $174 billion for electric vehicles will go toward consumer rebates designed to gin up demand. Only $15 billion would go toward more politically fraught efforts to help private companies build charging stations.

Inevitably, some of these investments will fail. And unfortunately, people will freak out. If markets were slashing U.S. carbon emissions fast enough to avert climate chaos, government wouldn't need to make risky bets on green companies. But they aren't, so it does.

Safe bets don't require government help, but safe bets won't disrupt a fossil-fueled economy. If you want truly radical change, failure isn't just an option. It's a necessity.

Welcome to POLITICO Nightly. Reach out with news, tips and ideas for us at mgrunwald@politico.com and rrayasam@politico.com, or on Twitter at @mikegrunwald and @renurayasam.

A message from the SEIU:

President Biden is investing $400 billion in care workers — largely women of color & immigrants working on the frontlines of this pandemic. We have a once-in-a-generation opportunity to create millions of sustainable union care jobs of the future. It's time for Congress to pass President Biden's jobs plan! Learn more

First In Nightly

WHAT ARE YOU BRINGING TO THE PARTY? The U.S. is furiously prodding world leaders to show up to Biden's climate summit next week with new pledges to fight the rising temperatures threatening the globe, but so far, it seems the only big promises may be coming from the White House, Zack Colman writes.

Biden is planning to use his platform at the "Climate Leaders Summit" to reclaim the spotlight and put the U.S. at the forefront of the global effort to cut fossil fuel emissions and address worsening storms, devastating wildfires and rising seas. But after four years of former President Donald Trump's assault on international climate cooperation, foreign leaders are wary of jumping too quickly to follow Washington's lead, and they have been reluctant to respond to U.S. pressure to increase their climate ambitions.

The April 22-23 summit is expected to be attended virtually by 40 world leaders, including Chinese President Xi Jinping and Russian President Vladimir Putin. The White House has promised to promote its new national target, which people familiar with the administration's thinking say will call for reducing carbon dioxide by about 50 percent of 2005 levels by 2030.

That target, the details of which are still being ironed out, is part of the plan the U.S. must submit under its re-entry to the Paris Climate Agreement. The White House is likely to issue a range for its emissions reduction target, the people said, and administration officials are hoping a significant cut will pressure both allies and rivals to follow suit.

SUBSCRIBE TO "THE RECAST" TO JOIN AN IMPORTANT CONVERSATION: Power is changing, in Washington and across the country. More people are demanding a seat at the table, insisting that all politics is personal and not all policy is equitable. Our twice-weekly newsletter "The Recast" breaks down how race and identity are shaping politics and policy in America and we are recasting how we report on it. Get fresh insights, scoops and dispatches on this crucial intersection from across the country and hear from important new voices that challenge business as usual. Don't miss out, SUBSCRIBE . Thank you to our sponsor, Intel.

What'd I Miss?

— White House dials down likelihood Russia offered bounties in Afghanistan: Press secretary Jen Psaki said today there is not strong evidence that Russia allegedly offered bounties to the Taliban to target U.S. and allied forces in Afghanistan. Psaki said a review by the intelligence committee conducted in the wake of explosive news reports last year about the allegation determined its veracity with only "low-to-moderate confidence."

— Pelosi dismisses progressive 'court packing' legislation: Speaker Nancy Pelosi rejected a push from the left wing of her party to swiftly vote on legislation to expand the Supreme Court. "I have no intention to bring it to the floor," Pelosi said of the legislation, led by House Judiciary Chair Jerry Nadler and Sen. Ed Markey, which would expand the number of Supreme Court justices to 13 from nine.

— McCarthy: I've met with Gaetz; he professed innocence: House Minority Leader Kevin McCarthy said he has met privately with Rep. Matt Gaetz and that the Florida Republican denied any impropriety stemming from a federal sex trafficking investigation. "I've spoken to Mr. Gaetz about the accusations. He's told me he's innocent of the accusations," McCarthy told reporters at a news conference in the Capitol, adding that he reiterated that an indictment would cause internal consequences: "I explained to Mr. Gaetz the rules inside our conference. If there was something to come forward, we would take action."

— Chauvin won't testify at murder trial in Floyd's death: The defense at the murder trial of former Officer Derek Chauvin in the death of George Floyd wrapped up its case today without putting Chauvin on the stand , presenting two days of testimony to the prosecution's two weeks. Chauvin informed the court that he would not testify, saying he would invoke his Fifth Amendment right not to take the stand.

A message from the SEIU:

Ask The Audience

Nightly asks you: If you have been working remotely since the pandemic began last year, have you visited your office even once? Tell us what it was like. Use the form to send your answers, and we'll include select responses in Friday's edition.

From the Health Desk

HOW THE TESTS CAN BE WON — Sure, vaccines are the talk of the town. But Covid testing will still play a massive role in the return to some semblance of normalcy. In the latest POLITICO Dispatch , health care reporter David Lim reports on what's next for Covid tests — in schools and at home.

Listen to the latest POLITICO Dispatch podcast

AROUND THE WORLD

BEIJING'S OTTAWA BRUSHBACK — The Chinese government fired a warning shot at Canada today after its Parliament declared Taiwan's president an ideal candidate for a prestigious international human justice award, Andy Blatchford writes.

A Chinese foreign ministry spokesperson said if Canada fails to "prudently and properly handle" the highly sensitive issues around Taiwan it could inflict further damage to bilateral relations.

"China deplores and rejects the wrong motion related to Taiwan passed by the Canadian House of Commons," spokesperson Zhao Lijian told a press conference, according to a Chinese government transcript. "The 'One China' principle is the political foundation of China-Canada relations and a solemn commitment by the Canadian government."

A nonbinding motion, adopted unanimously Wednesday by Canadian MPs, called President Tsai Ing-wen a "well-respected international leader, female president of Taiwan and a strong global advocate for democracy." The statement, introduced by Conservative MP Michael Chong, also said she would "certainly be an ideal fit" for the Halifax International Security Forum's signature award.

YOUR GUIDE TO THE BIDEN ADMINISTRATION: As the Biden administration closes in on three months in office, what are the big takeaways? Will polls that show support for infrastructure initiatives and other agenda items translate into Republican votes or are they a mirage? What's the plan to deal with Sen. Joe Manchin? Add Transition Playbook to your daily reads for details you won't find anywhere else that reveal what's really happening inside the West Wing and across the executive branch. Track the people, policies and power centers of the Biden administration. Subscribe today.

IMMIGRATION

THE LACK OF IMMIGRATION REFORM, EXPLAINED — The question of how to best process the thousands of migrants arriving at the southern border plagues Washington. Immigration correspondent Sabrina Rodiguez, in the latest POLITICO Explains video , dives into the politics lawmakers are facing on how to handle migrants' arrival and the root causes.

Nightly Number

The number of acres that the Biden administration seized from a family in Hidalgo County, Texas, the result of a Trump-era court case designed to help construct the border wall. Nearly three months into office, the administration is seizing land near the southern border, fueling fears that the government will continue building one of the symbols of Trump's presidency: a border wall.

Parting Words

OPERATION LONDON BRIDGE — What will happen to the United Kingdom when the queen dies?

Car mechanic, broadcaster, stamp collector, fashion icon, the longest-serving monarch in the history of the United Kingdom — no one has a resume like Queen Elizabeth II's. But even remarkable lives must someday end, as the death of her husband Prince Philip reminded the world last week, Anna Isaac writes. And with the queen turning 95 on April 21, planning for the transition is an increasingly pressing issue, for the royal family and for the union over which she presides.

It's clear that the U.K. is a country of Elizabethans (to steal a turn of phrase from Australia's former Prime Minister Malcolm Turnbull, a prominent republican). What's less clear is whether it's a country of monarchists.

While the queen remains personally popular, a series of public relations disasters has tarnished the rest of the royal family. A recent poll found that more than 70 percent of people in Scotland, Wales and central England approved of the queen. Only 50 percent of respondents in Wales and central England approved of her heir, Prince Charles. In Scotland, support for Charles was just 41 percent.

At question is not whether the U.K. will abolish the monarchy once Elizabeth dies. The institution itself continues to enjoy broad support, according to a poll from October. It's whether — with the U.K. under unprecedented strain from Scottish separatism and the aftereffects of Brexit — any future monarch will be able to provide the same steadying influence as the one whose hand has been on the tiller for more than half a century.

A message from the SEIU:

President Biden's plan to invest $400 billion in essential care infrastructure is a commitment to America's future. It means millions of good union jobs for women of color and immigrant workers. It means accessible and affordable home care for all families — so our parents, grandparents and people with disabilities can live at home with dignity and independence. It means thriving, resilient communities.

Congress must meet the president's commitment to invest in care infrastructure and care workers as a cornerstone of the American economy. Learn more and join us!

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