Trump has the Inflation Reduction Act on the ropes, but its legacy lives on through local climate justice wins. What can we learn for the future from its failures?
The Biden Administration quietly passed the largest federal climate justice policy in history in 2022. The Inflation Reduction Act (IRA) was meant to address long-standing inequities in climate funding, but reliance on market-driven incentives (like tax credits) has favored corporations and the wealthy, neglecting marginalized regions. As Trump and Musk freeze $20 billion of unallocated IRA funds and threaten mass-firings of federal workers, what is the legacy of the Inflation Reduction Act (IRA), and what is its future?
To evaluate the IRA’s climate justice implications, we talked to people implementing it: local and national-scale climate justice organizers, planners, and nonprofits doing the work of funneling money through the federal grant process and the tax code to fund climate action on the ground.
We heard about the possibilities that federal recognition of environmental justice creates. IRA-funded programs put money back into community hands to adapt to climate change while starting to redress centuries of environmental racism and industrial wrongdoing.
We also heard how those possibilities fell short. Governmental agencies at all levels were too under-resourced to administer complex grant and tax credit programs. Meanwhile, community groups and smaller government agencies with the greatest need for funding had the least capacity to access it. And, a program designed not to step on fossil fuel industry’s toes or explicitly name racism or colonialism as environmental issues was never equipped to fund transformative change for a more equitable, affordable, and healthy society.
Trump’s recent executive order halting federal grants and loans freezes critical funding for disaster preparedness, clean energy, and climate resilience. Understaffing was one of the main barriers interviews identified. Firing thousands of government employees in the name of “efficiency” (while leaving destructive military spending unchecked) is a massive step backward. As climate disasters escalate, frontline communities – already facing bureaucratic delays and funding barriers – are now even further cut off from the resources they need to rebuild and adapt. State and local agencies, already struggling with limited staff and resources now face even greater constraints on responding to disasters like the Los Angeles wildfires.
While flashy executive orders spark chaos and panic, some IRA stories provide durable examples of how federal climate policy can succeed. Planners and organizers in Colorado talked about how IRA incentives for well-paying jobs and apprenticeships pushed state law into raising the floor on labour standards. Meanwhile, grants for climate plans and new infrastructure projects have created those jobs, training a new generation of workers in durable skills for green careers. In Seattle, the municipally-owned public utility can write off big spending on electrification in its tax returns — an unprecedented option, enabled by the new tax mechanism of direct pay.
What these successes have in common is savvy local-scale political organizing that puts labour, housing, energy affordability, and resilience at the centre.
“The Inflation Reduction Act, and especially associated programs such as Justice40, demonstrate that when faced with multiple overlapping crises, governments can choose an all-of-the-above approach to climate action which centres housing, labour, migrant rights and economic justice. At a time when there is an urgent need to shift our local and national economies away from costly and harmful fossil fuels, governments in Canada can benefit from the experience of their American counterparts. This report demonstrates that unlike market-based mechanisms, and despite certain challenges, the initiatives in the IRA permanently and holistically moved the needle in hundreds of communities across the United States. The impact of these policies will last for decades to come.” Alex Cool-Fergus, CAN-rac
For media inquiries, please contact the author, Tova Gaster, at tova.gaster@gmail.com.
