I’m not sure who first observed that a lot of progressivism these days has the effect of transferring income from the middle class to the upper class, this is certainly true of much of the “green” tax credits and subsidies that are supposedly driving our “energy transition.” This conclusion is amply demonstrated by a new working paper by Severin Borenstein and Lucas Davis at Haas Business School at UC Berkeley. I’ve never met Borenstein or Davis, but I have reported on their work on the perverse distributional effects of green policy before.)
The new paper, “The Distributional Effects of U.S. Tax Credits for Heat Pumps, Solar Panels, and Electric Vehicles,” concludes that
Over the last two decades, U.S. households have received $47 billion in tax credits for buying heat pumps, solar panels, electric vehicles, and other “clean energy” technologies. Using information from tax returns, we show that these tax credits have gone predominantly to higher-income households. The bottom three income quintiles have received about 10% of all credits, while the top quintile has received about 60%.
Here’s just one of the charts from the study showing the skew:
“Net-Zero” is really a slogan about working- and middle-class income growth, apparently.
