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A US Inflation Reduction Act for Europe

While some European policymakers are ambivalent about the US Democrats’ signature climate-change legislation, the American plan’s targeted, government-centered approach is far more credible than the market-based approach guiding the EU’s current green agenda. Instead of fighting the IRA, Europe should embrace its pro-worker bent.

MANNHEIM – The United States’ recently enacted Inflation Reduction Act (IRA), which includes hundreds of billions in federal subsidies for green technologies and renewable energies, marks a long-overdue shift in US climate policy. But while the US decision to join the global fight against climate change has been well received in the European Union, some leaders have voiced concerns that the bill focuses too much on domestic production and might discriminate against EU-based companies.