From "Cut Your Bill in Half" to a Breaking Point

From "Cut Your Bill in Half" to a Breaking Point

This week Gary and I sat down with Congressman Mike Levin, who represents California’s 49th, the district that runs from Camp Pendleton up through north San Diego and into a slice of Orange County. Levin is one of the few members who pairs a seat on House Appropriations with a real decade of clean-energy work before he ever ran for office, the exact reason why we wanted him on. We talk primarily about the thing confronting every American these days: the cost of energy. The numbers are rough: energy bills are up about 13% from a year ago. Roughly 80 million Americans can’t cover their utility bills right now. Rep. Levin’s answer is the Energy Bills Relief Act, which he co-leads with Rep. Sean Casten. It brings back the clean-energy tax credits that got cut in the “one big beautiful bill,” makes data centers and hyperscalers pay their fair share instead of quietly handing the cost to you, and rewards the people who actually conserve. He also doesn’t pretend any of this is simple. He’s a clean-energy guy who’ll still tell you NEPA isn’t perfect, and who won’t let “permitting reform” turn into a Trojan horse for oil and gas. In his words, that’s the dashboard light blinking red. We got into something that should be simple and somehow isn’t: why a military family’s housing allowance is the very thing that disqualifies their kids from a free school lunch. As Levin put it, that’s about the lowest bar a country can clear. Tahra Hoops: Hi, everyone. My name is Tahra Hoops. I’m here with my co-host, Gary Winslett, and today we have a very special guest. We have Congressman Mike Levin [https://levin.house.gov/], a Democrat representing California’s 49th Congressional District, first elected in 2018, flipping a long-held Republican seat, and who has won four consecutive elections in one of the most competitive districts in the country. Levin serves on the House Appropriations Committee [https://appropriations.house.gov/], with seats on the Energy and Water Development and Military Construction, Veterans Affairs subcommittees, where he is obviously very busy. And before Congress, he spent more than a decade as an environmental attorney and clean energy advocate. Rep. Levin, we are so excited to have you here with us. Rep. Mike Levin: Thank you so much for having me. Great to be with you. The power of the purse Gary Winslett: Great to have you here. So I guess my first question is, you’re the only member from San Diego or Orange County on House Appropriations, and you sit on Energy and Water. The Trump administration has paused or canceled a whole slew of green energy and grid projects. So my question is, what levers do you have on that subcommittee to push back on that right now? And where do you think a future Democratic majority could move quickly to reverse course on some of these cancellations? Rep. Mike Levin: The good news is that our lever is the Constitution of the United States, Article I, Section 9, Clause 7, that the Appropriations Committee, both in the House and the Senate, has the power of the purse and determines how we spend tax dollars, and also helps to oversee how those dollars are being spent. And so this administration has run afoul of the Constitution in many ways, but one is undermining the power of the purse of Congress. The good news here is that the president submits a budget request to the Congress, and then we work on a bipartisan basis to try to iron out an actual bill that reflects our values and reflects our priorities. And on the Energy and Water Subcommittee last year, for example, the president submitted a budget request that eviscerated clean energy and propped up oil and gas at the expense of accelerating the future that I’d want to see, which is more clean energy and lower costs for the average person. But we were able to push back, and the Republicans on the committee actually needed our votes. They needed our support to get the bill across the finish line, and we were able to sustain, I would say, 80% of what we wanted in terms of clean energy funding, research and development funding, and the rest. And so appropriations is a very powerful way where we can combat some of the extreme policy proposals of the president, and not just on energy, where he’s done everything to go after wind and solar and batteries, you name it, often for completely nonsensical reasons. But we can stand up, and we can find common ground, and we can push back against some of the extremism. Gary Winslett: So it’s funny you mention the president usurping the power of the purse. That’s basically what SCOTUS said when they struck down his IEEPA [https://en.wikipedia.org/wiki/International_Emergency_Economic_Powers_Act] tariffs, that if Congress had intended to give away its taxation authority, tariffs or taxes, they would’ve said so in IEEPA, and they never do. So this is a recurring theme with this administration. Rep. Mike Levin: The same is true for appropriations and the power of the purse. And while the Supreme Court ruled narrowly on IEEPA and on the tariff situation, I think you’ll find a similar ruling once the court actually adjudicates Article I, Section 9, Clause 7 related cases, which I think are pretty clear. Russ Vought, the Office of Management and Budget [https://www.whitehouse.gov/omb/] director, he really is out of control. He is acting as though he’s in charge of federal spending. And look, we can differ on federal spending in terms of ideological differences and matters of different priorities and such. We do all the time on the committee. We have good back and forth, good debate, but we are the Congress of the United States. We’re elected by the people in all the communities across the country to represent their interests and their values and priorities, and we need to do our work, and the executive is then there to execute on the laws as passed by the Congress, including the spending laws. So look, we see this administration undermining legislative authority on many levels, and this is just one of them. Tahra Hoops: I’m glad you mentioned the budget, because the first time I went through the proposed budget that they gave to us, it was just about saying, get rid of anything that allows an American to have a comfortable life, and either send it overseas or send it to a defense mechanism, and just completely forgetting what domestic policy was, and forgetting how to have a secure future for American families. So it’s glad to see members of Congress being able to understand the impacts that it does have on domestic households, because it definitely is jarring to understand. But I did want to highlight some of the efforts that your team has been working on that we are definitely so excited to hear about. EBRA: the Energy Bills Relief Act Tahra Hoops: You and Rep. Sean Casten [https://casten.house.gov/] co-lead the SEEC Clean Energy Deployment Task Force [https://seec.house.gov/], very long name, and co-authored EBRA, the Energy Bills Relief Act [https://levin.house.gov/media/press-releases/reps-levin-and-casten_seec-clean-energy-deployment-task-force-introduce-the-energy-bills-relief-act]. Obviously, energy bills have never been more politically salient than they are now. We saw the recent CPI report. Energy prices, gas prices are simply through the roof. It was an issue before. We have hit crisis mode. And from your seat in California, where people are already paying some of the highest rates in the country, what does this bill specifically deliver for your constituents and across the board? Because they are truly at a breaking point. Rep. Mike Levin: You are absolutely right. The bills have gone up roughly 13% year-over-year, energy bills. And if you remember, Trump campaigned on cutting bills in half. I mean, think of that. Back in November of 20-- or October of 2024, he said he was going to cut our electric bill in half, and instead it’s gone up significantly, and the war in Iran has made it even worse. Look, you’ve got roughly 80 million Americans that can’t afford their utility bills right now. In my community, roughly one in four are behind on their electric bill. And so our bill is called EBRA, the Energy Bills Relief Act, and it has five main components, all of which I think are really important to tackling the challenge. First is reinstating the tax credits that we had in place for things like home and community energy improvements, solar and the rest, that were ended by Trump with his one not-so-beautiful bill [https://www.congress.gov/bill/119th-congress/house-bill/1] last year. And bringing those back, I think, is really important. Two is making sure that data centers are paying their fair share. So we see the proliferation of data centers and hyperscalers all across the country, and we have to make sure that as this is done, the average ratepayer isn’t getting stuck with the bill. So we’ve got a mechanism to do that. Third is rewarding the consumers who are saving energy and embracing energy efficiency, and it’s astonishing to me that we wouldn’t all want efficiency. We wouldn’t want conservation. When I hear the word conservation, I think conservative. You would think conservatives would actually want conservation. But they’ve spent valuable floor time, the Republicans have, on trying to undo efficiency standards for appliances, for refrigerators and shower heads and all the rest. I mean, it’s just insane to me. Number four is providing the financial assistance necessary to families who need it, so that their lights aren’t turned off. And number five is giving a voice back to the American people again, so we actually have a consumer-focused energy policy, not one that’s just run by a handful of big executives or big tech companies. In California specifically, we’ve got some unique challenges, and the bill has a program designed to offset the cost that utilities are incurring for wildfire-related infrastructure. So wildfire-related costs are now a huge driver of the electric bills, and so our legislation has a mechanism to help offset those costs for the utilities, in a way that I think will be a lot more fair for the average ratepayer. Feeding military kids Gary Winslett: Cool. So Camp Pendleton sits in your district, and you recently reintroduced the Military Dependents School Meal Eligibility Act [https://levin.house.gov/media/press-releases/rep-mike-levin-reintroduces-bipartisan-bill-to-expand-access-to-free-and-reduced-price-school-meals-for-military]. What that does is it stops the basic allowance for housing that military members get from disqualifying those families for free and reduced-price school meals. A lot of people aren’t talking about this cost-of-living squeeze through the lens of military families. How does that look to you and your constituents from where you sit? Rep. Mike Levin: So the Marines and sailors that I represent on Camp Pendleton [https://www.pendleton.marines.mil/] and around our community, and of course we’ve got so many wonderful military families throughout our region, it is an expensive place to live. San Diego is an expensive place, and Orange County is an expensive place, and I hear so often from our military community that they’re having trouble making ends meet. During the pandemic, I saw really unbelievable stuff with moms and families lining up for food. Kids that in some cases their best meal of the day was that free and reduced meal they were getting at school, and with COVID, they weren’t getting that meal. So the BAH, the basic allowance for housing, is a very modest amount of money that doesn’t really cover the necessary living expenses the way it should, and we should not be penalizing military families and precluding their children from being eligible for school lunches. It’s really the least we can do. If you think that we’ve got men and women who are volunteering to put themselves in harm’s way to defend our country, to serve our country, and many of them have families that have to move all around the country all the time, and the uncertainty that their mom or dad is going to wind up deployed and in a dangerous situation that can come at any time. The least we could do is make sure the kids that are moving around, that are growing up in this environment, have enough to eat, have a great school to go to, that we’ve got great childcare centers for early childhood. That is the least we could do, and if we can’t even do that, we’ve got to look in the mirror and ask, “What in the world are we doing around here?” Tahra Hoops: I completely agree, and it is such a frustrating pivot point for people to be like, “Well, what about the very rich of the rich who can afford to send their kids to lunch? I don’t want my tax dollars to fund their kids’ lunch.” It’s such a moral argument. The economics of it is so small. It is so small to be able to provide free lunch for kids. And I find that policies like this can be replicated. If it is in a time of emergency where we find a regulation is a bit redundant, and it needs to be rolled back during this time, we need to look at that specific policy and ask ourselves why it’s there in the first place, no matter how well-intentioned we might square it away in our minds. But something as small as having free lunch for kids in our schools should not be something that keeps us up at night, especially when we have a current administration sending millions of dollars and causing a global supply shock right now over a war that just about no one voted for, or wanted, or even figured out, or was able to communicate clearly why it was happening. So I want us to have our focus in the right place here, because it sometimes seems like it’s almost a culture war that gets very misconstrued online, of what’s important and what’s not, and it really shifts our priorities on what matters. But I did want to circle back really fast on all the great things you mentioned in EBRA, because as we mentioned before, you spent more than a decade working in clean energy before coming into Congress, so you more than anyone have such a key expertise on this, and I feel like that gives you credibility to discuss permitting reform. We now have a time to have actual talks on permitting reform. We had talks on it before. I believe Democrats kind of were slow to respond on that. But some in the coalition will treat NEPA reform and faster transmission siting and quicker interconnection queues as a great thing, and others find it as a threat to environmental law. How do you make the case to environmental groups that building faster is pro-climate, that it lets us achieve our climate goals while also achieving our affordability goals that have hit precedence right now? Permitting reform without steamrolling Rep. Mike Levin: Well, I think you raise an excellent question, and I guess I would frame it by saying that a lot of times, when I hear people talk about permitting reform, they are talking about it in a manner that is designed to appeal to the oil and gas interests, to make it easier for oil and gas permitting. And I think that fundamentally is the wrong thing to be trying to achieve. I want to make it easier for building multi-state, multi-gigawatt transmission lines and the electric grid of the future that we’re going to need to interconnect all of the distributed generation, all the electrified transportation, all the other things that I’d like to see in the clean energy future that I hope we all can have. And so I think there’s a lot of desire to go after the National Environmental Policy Act [https://www.epa.gov/nepa], or NEPA, which was a truly bipartisan bill all the way back in the ‘70s when it was passed and signed into law by Richard Nixon. And it’s not to say NEPA is perfect, because it is definitely not, but I think too often, oil and gas interests scapegoat NEPA as a starting point for negotiations on permitting reform, rather than looking at what the real challenges might be, looking at other reforms that we can make. I’m also a person who’s developed clean energy projects in my professional career, and I’ve never agreed with the notion that the best way to accelerate things is just to steamroll people, to steamroll parties of interest, to not get good buy-in at the outset of a project. I think we ought to improve the processes that you need to build. You need to make it faster to build. We have ideas in EBRA on how you do that. But I think better community engagement, focusing on the transmission side, is where I’d like to see all this land, and then dealing with the data center piece and the tax credit piece is really, really important. So anything that, to me, smells like it’s being driven by the fossil fuel industry at the expense of clean energy, for me that’s the dashboard light blinking red. Lightning round Gary Winslett: Fair enough. So we like to end with some lighter, more lighthearted questions, just a fun way to end the podcast. Our first one is, what is something that people don’t know about your district that you find fascinating? Rep. Mike Levin: Ooh. Well, I’ll tell you that Camp Pendleton is massive. If you were to look at Camp Pendleton, it’s bigger than some countries. I don’t know if you’ve ever driven south on the 5 Freeway or north on the 5 Freeway, but you see the San Onofre Nuclear Generating Station [https://en.wikipedia.org/wiki/San_Onofre_Nuclear_Generating_Station]. You might see a sign or two for Camp Pendleton, but you don’t see how far inland it goes. It’s vast. If it were its own city by landmass, I think it would be the biggest city in my district by landmass. And just the extraordinary community there. It really is like a city in a lot of ways. Tahra Hoops: What is something that you think is too expensive, and you can’t say housing, healthcare, or anything like that? Rep. Mike Levin: How about everything right now? No, seriously, you know, I love shopping at Trader Joe’s and Costco, and I was just at Costco and gas was $6.80. I know I’m not supposed to say gas, but I will tell you, it was $6.80 a gallon for gas at Costco. That’s a discount of probably 30 cents from elsewhere. And I’ll give you one. I love blueberries, I love strawberries, any kind of fresh food or fresh fruit, and I’ve seen the prices go through the roof. We have a growing son and daughter, 13 and 12, my wife and I, and I look at that grocery bill every month and it goes up and up and up. And I get it. It’s awful. Gary Winslett: I was just laughing about your berry comment, because I have a seven-year-old, and I go through I don’t even know how much money in the berry fund each month. Rep. Mike Levin: Hey, and I love our— Tahra Hoops: Berry fund. Rep. Mike Levin: —berry growers. We’ve got them in my district, and those are two of my favorite things to eat pretty much every day, blueberries and strawberries. But man, they’re getting pricey. Tahra Hoops: They’re going to continue to get pricier the longer this goes on, because we’re soon going to see wholesale prices start to rise, and that is going to be passed on to consumers. So it’s not like junk food that is going to rise. It’s the necessities, like the fruits and vegetables, that are going to continue to worsen. And people can square away the gas issue. I’m in Los Angeles. I’m grateful that I don’t actually have to drive. I work remotely. But I remember posting a photo of the gas prices here, and the comments on mine were like, “Well, this is just clearly AI. It’s clearly fake.” And I’m like, “No, they’re real. People are paying them.” Rep. Mike Levin: Well, it’s the one-two punch of the tariffs and then the war. The war has increased the prices by about a buck 40, buck 50. I will tell you, in California we’ve got higher prices for a lot of reasons, and they were already too high to begin with, but then you add on the war in particular, and it’s just breaking a lot of people right now. They can’t afford it. I’m hearing from people that the percentage of money that’s going to fuel continues to go up and up and up, and there’s just not enough money left over at the end of the month. Gary Winslett: And then our final question is, what is a policy or innovation that you believe is underrated? Rep. Mike Levin: Underrated. Ooh, I’ll give you one that’s a little bit wonky, something that’s a big passion of mine. So if you’ve done that drive on the 5 Freeway and you’ve seen those nuclear power domes there that were producing power for many years, we now have nuclear waste on the coast, and the plant there is no longer producing electricity. It hasn’t for some time. We’ve got stranded nuclear fuel at these facilities all across the United States, and that’s not good. We need to get those facilities, the nuclear waste or spent nuclear fuel, to safer places. We have earthquakes, we have population density, we have sea level rise, and we have Camp Pendleton right there, a very important military base. So I’ve been working on a bipartisan basis now for a number of years to really launch a new initiative to solve the spent nuclear fuel challenges across the United States, and that’s actually going very well. It’s maybe the one thing I can point to under this administration and tell you that it’s going really well. Tahra Hoops: Well, that’s great to hear, and I’m glad we were able to end on a more positive note, given that currently Americans are feeling so many compounded impacts. But it’s glad to see that we have members of Congress who are actually targeted and focused on lowering the daily cost for Americans, because as it continues to worsen, it gets to a financial nihilistic feeling, and that’s a place we never want to be. So we really appreciate the work you’re doing, and for coming over and speaking with us. Thank you. Gary Winslett: Thank you. Rep. Mike Levin: Grateful to you. And I think it’s important that we’re not just reflexively against what the president is doing, that we have plans of our own to lower costs and actually improve the lives of everyday Americans. And we do. Tahra Hoops: Thank you. This is a public episode. 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From Pro-Business to Pro-Market: The Rebuild Conversation with Rep. Sean Casten

The biggest barrier to cheap energy in America isn’t technology, cost, or even politics in the abstract, it’s that utilities get to decide who competes with them. That’s the throughline of this week’s conversation with Rep. Sean Casten (D-IL-06), a clean-energy engineer turned Financial Services Democrat who has spent four years co-authoring the Energy Bills Relief Act with Rep. Mike Levin. The numbers Casten lays out are startling. There are 2,000 gigawatts of new generation waiting to connect to the U.S. grid. Only 85 of them are fossil fuel. The market has already chosen clean energy; the regulatory system keeps blocking it. Meanwhile, electricity bills are up 13% in Trump’s first year, and utilities just asked for $31 billion in new rate hikes. From there the conversation widens: what the One Big Beautiful Bill’s rollback of IRA tax credits actually does to coal communities, why one Category 5 hurricane could push Florida into bankruptcy, and Casten’s central argument, that the Republican Party of his youth was pro-market, the Republican Party of today is pro-business, and Democrats have an opening to claim the difference. Tahra Hoops: Hi everyone. My name is Tahra Hoops. You are joined here at The Rebuild with my co-host Gary Winslett. Today we have a very special guest: Congressman Sean Casten, who represents Illinois’ Sixth Congressional District. It includes a lot of Chicago’s western suburbs. He was first elected in 2018, actually flipping a Republican-held seat at that time. Casten serves on the House Financial Services Committee [https://financialservices.house.gov/] and the Joint Economic Committee [https://www.jec.senate.gov/]. Before joining Congress, he spent two decades in the clean energy sector, including as CEO of Turbosteam and co-founder of Recycled Energy Development. In Congress, he’s focused on energy policy, climate change, grid modernization, and helping to lower utility costs for constituents across the nation. We are very excited to have you. Representative Casten, how are you doing today? Rep. Sean Casten: Good. Thank you for having me. Tahra Hoops: I wanted to jump into the recently introduced Energy Bills Relief Act [https://www.congress.gov/bill/119th-congress/house-bill/7977/text], which is the most ambitious affordability-focused energy legislation House Democrats have put forward this Congress. It comes at a moment when electricity bills are up 13% in Trump’s first year, and utilities just requested $31 billion in rate hikes. Tell us what is in this bill and why this is the moment for it. Rep. Sean Casten: It’s funny. Sometimes moments just come to you. Mike Levin [https://levin.house.gov/] and I, who came in together in 2018, have literally been working on this bill for four years, and we’ve been half joking that we were just waiting for Trump to totally botch our energy policy and invade Iran to really make it resonant, so we could run between the shackles. Somewhat more seriously: when Mike and I both got elected, the Speaker picked us to serve on the climate committee. We wrote a set of 700 recommendations, about 300 of which became law in the Inflation Reduction Act [https://www.congress.gov/bill/117th-congress/house-bill/5376]. But when we got our report done, we had a bunch of outside experts vet it, and we said: what is the biggest thing we’re missing that’s going to delay our ability to achieve these goals? And they said, without exception, that the United States has never built transmission fast enough to deploy clean energy. We’re very good at building gas pipelines, which means we build gas plants where we can run the gas to it at the load. But we try not to build transmission. And so we said, we’ve got to have a package, and we have to have a package that when the window opens, it gets there. I say this in a climate perspective, but I could just as easily say it in an affordability perspective, because if you can keep your lights on and keep your house warm and get back and forth to work every day without buying fossil fuel, that also means you can do all those things without paying for fossil fuel. Clean energy and affordable energy are completely synonymous. And candidly, that’s always been the biggest political barrier, because truly prioritizing the interests of consumers to have affordable energy is an existential threat to the fossil fuel sector. Gary Winslett: It’s funny you mention transmission. Where you are, we make tons of wind in Iowa, and Chicago’s where it needs it. You’re sitting across exactly one of those transmission corridors. Rep. Sean Casten: Yeah, and there are multiple projects that would bring that wind, that cheap power, into the area, and they’ve been consistently bedeviled by grid interconnection. Grid interconnection is one of these things. The old joke is that asking a utility to connect to their grid is like asking a man for permission to date his wife. Whether or not that’s the best outcome for all involved doesn’t really factor into the conversation. When you’re sitting there as a utility and power prices are running 90, 100, $110 a megawatt-hour, and somebody wants to build a line that would bring $20 or $30 power in, that’s a competitive threat. You don’t need to be cynical about it. That’s just a practical reality. No business wants to compete with lower-cost supply if it doesn’t have to. And so we’ve seen time and time again utilities and regulators doing a really good job of building transmission lines to bolster reliability and an objectively terrible job of building transmission lines for affordability. Gary Winslett: Has your region, PJM, been particularly tough on this? Rep. Sean Casten: Everybody’s tough in their own special way. I criticize ERCOT [https://www.ercot.com/] all the time because ERCOT has remained un-interconnected. That’s the Texas grid. On the bright side, I think PJM [https://www.pjm.com/] has done a much better job than MISO [https://www.misoenergy.org/] of really embracing markets as tools to solve problems. But all of the regional transmission organizations are really bedeviled by governance problems. Their governance is set by their members, and their members, because they have so much capital invested in the system, are innately lowercase-c conservative. And a lot of what Mike and I have done tries to fix those things: let’s reform the governance process, let’s compel all the RTOs to be evaluated on a consistent set of metrics over the same geography and on the same timeline, let’s give FERC [https://www.ferc.gov/] the authority to permit transmission lines, which it already has for gas lines. We know that system works. We have the ability to do it. But let’s get rid of these abilities for local actors to gum this up, while still making sure that we protect consumers and the environment. Gary Winslett: Of course. That would just put green energy on the same level playing field as natural gas. What we’ve done with natural gas has been great, but green and clean electricity should be on the same playing field. Rep. Sean Casten: Look, you can see it in the numbers. We currently have about 1,300 gigawatts of generation in this country. There are 2,000 gigawatts waiting to be interconnected. Of those 2,000 gigawatts, 85 are fossil fuel-fired. Everything else is wind, solar, batteries. That’s what markets want to build. Wouldn’t you prefer to build an asset with no operating costs so you can make more margin? That’s what they want to build. But that stuff is also the competitive threat. Gary Winslett: Could I also ask you about the tax credits in this bill? What do they do and why do they help? Rep. Sean Casten: The simplest way to answer is: we simply restore all of the IRA tax credits that were taken away in the One Big Beautiful Bill that Republicans passed. The reason is a little more important from a policy perspective than just “let’s get back at those bad guys.” If we were to fully embrace affordable energy, it would be a massive wealth transfer from energy producers to energy consumers. Every single American is an energy consumer. A small number of Americans are energy producers. Do the math. All is more than some. However, for certain communities, that wealth transfer is really, really economically painful. Look at what’s happened to the West Virginia economy as markets have turned away from coal. If you’re living in a town where the mine shut down, then the power plant shut down, then the Walmart shut down, and now the school can’t afford an improvement to the football field, you might understandably not see affordable energy as your friend. And part of the reason why we wanted to bring those tax credits back in is that when we crafted them, and when I say “we,” I’m talking Mike Levin and the other members of the climate committee, we were really intentional about saying we have to put incentives in place that prioritize investments in those communities that have historically stapled their economy to yesterday’s technology. Because they’re all Americans, and we want everybody to see this as a win, not just the people who don’t depend on the oil derrick in their back 40. And so those IRA credits with those incentives were really important to put back in. Tahra Hoops: It is great to see you champion that, because there was so much progress in the prior years and it seemed like we were just starting to see results. But then we have people across the aisle who seem stuck in the past. There was a recent quote from Energy Secretary Chris Wright who said, “I am pretty confident coal will lead the world in global electricity production”. I find that mind-boggling, because if you look across the globe, coal seems like something of the past. Right now we are in an all-of-the-above energy approach, and renewables are a part of that. You’ve directly criticized the Trump administration’s energy policies. What would you say to Republicans who argue that coal or fossil fuels are still the cheapest and most reliable option? Rep. Sean Casten: Look, it’s not freaking complicated. I could tell you academically all the reasons why, if you don’t have to pay for inputs, you’re going to have a lower operating cost and therefore compete in a market. That makes me sound like a college professor. If you don’t want to treat it that way, just look at the freaking scoreboard. Coal consumption in the United States has declined over 50% in the last 15 years. That’s not because of wokeism. It’s because a coal plant is a really lousy investment. The private sector is not building coal because you can’t make any money running a coal plant. Coal plants don’t run that often because they get outcompeted by everything else on the grid. Oil consumption in the United States is exactly the same as it was 15 years ago, not because of wokeism, but because given the choice between a car that gets 10 miles to the gallon and a car that gets 30, or better yet an EV that doesn’t take any fuel, people like not paying for energy. It’s pretty awesome not to have that bill. So as I tell my Republican colleagues: shut up with your wokeism. You are just afraid of capitalism, because you are a mediocre individual who cannot compete, because you are part of that half of the population that is well below average. That is the Chris Wright story. Tahra Hoops: I cannot agree with you more. I saw that and I’m like, these are the people who lead and govern us. Rep. Sean Casten: Chris Wright testified before a science committee hearing that I was on, before he came to Trump’s office. I told him that he was a disposable human being who would be an embarrassment to his grandchildren. I stand by my words. Nobody in the energy industry took Chris Wright as a serious player. He was a guy who could say things and go on Fox TV, and he is as qualified to be Secretary of Energy as Pete Hegseth is qualified to be Secretary of Defense. These are not people who were recognized as understanding the nuance in their industry. Before they got there, they did a good TV hit, and that’s what Trump wanted, and that’s what Trump got. We have to engage with them because of their power and because they’re tied with the White House. But when you look at what markets were building, markets wanted cheap. When you look at what the rest of the world is building, those not bedeviled by this political concern, they’re making those transitions to more affordable energy. I’ll give you a statistic. If you divide US GDP by total energy use, we generate about $200 of GDP for every million BTUs of energy. The Danes generate over $500. The Swiss generate over $600. The Brits generate over $300. That means we could potentially double the size of our economy with the same amount of energy input, or cut our energy input by half and have the same standard of living. Why wouldn’t you want to do that? We invest in labor productivity all the time. We want to get the maximum return on capital. If you’re a steel manufacturer, you don’t want to throw iron away. You want to turn as much of it into steel as possible. Energy is the only place where the United States does such a terrible job relative to other first-world economies at turning inputs into useful output. We can either be depressed about that, or say: what an amazing opportunity to grow our economy. Gary Winslett: That’s exactly right. The United States has both solar and wind potential, different places, to be sure. Denmark has great wind, not ideal for solar. We actually have both. So we’re kind of just leaving a lot on the table. Rep. Sean Casten: And candidly, our challenge is that we also have a lot of coal and a lot of gas, and you’ve got a lot of communities that have built their economies on that in ways you don’t see in other countries that embraced efficiency sooner. Denmark is a little bit weird because Denmark made the commitment to efficiency before the North Sea oil discoveries, and by then it was habit. The US, I think, is still deciding whether we want to be full-on adults or whether we still like having the lack of responsibility that you have when you’re a teenager. Tahra Hoops: It seems to me, just from hearing this, that Democrats are the people who would like to succeed in a capitalistic market, and it’s the Republicans who are holding us back by trying to own the libs and arguing about culture wars from ten years ago. That’s not the narrative you see online. When you think about Democrats and how they move when it comes to innovation, somehow you’d think they’re going to be the party trapped by woke culture stories that you’ll see in the New York Post, stories that are going to harm innovation for all, and that Republicans are trying to be the serious adults. But as you can see from the work you’re doing, it is just the opposite. Rep. Sean Casten: There’s ample data, and I hate that we have to say this. The Joint Economic Committee, bipartisan and bicameral, has done research showing that going back six presidents, the economy always performs better under Democratic leadership. Not just a little better. A lot better. Eighty to ninety percent of all the jobs created under those six presidents were created under Democratic presidents. The GDP always grows more, the dollar’s always stronger. I will say there’s nothing innately Democratic or Republican about supporting competitive markets. Ronald Reagan deregulated the airlines and telecoms and led antitrust enforcement. That’s an ideology that works. I think what’s hard, and this is arguably just as hard for Democrats as Republicans, is that any business that has achieved a certain scale has a lobbying shop. Any entrepreneur with a great idea who can compete against that incumbent doesn’t spend their time on lobbying. So you hear very few voices on either side of the aisle in Washington saying, “What we need is more competition.” Competition has never really had an advocate in Washington. Gary Winslett: It’s funny you mention how bipartisan some of this is. A lot of that deregulation actually starts under Carter. Carter just doesn’t get as much credit for it as he probably should. But that goes to your point. There’s not a Democrat or Republican way to ensure competition. Rep. Sean Casten: Maybe this is just my anchor point. I was born in ‘71, I don’t remember Nixon at all, I have vague memories of Carter, but Reagan was the first president I really remember. But I do think the Republican Party of my youth was a pro-market party. The Republican Party of today is a pro-business party, and those are not synonymous terms. There’s a real opportunity for Democrats to step into that void and say: let’s be the pro-market party. Gary Winslett: I did want to ask you a little more about the Energy Bills Relief Act. If we could get it, it’d be great. How would you assess success in the first few years, if it passes? Rep. Sean Casten: Let’s make no small plans. I think the last real meaningful energy bill Congress passed was the Energy Policy Act of 1992 [https://www.congress.gov/bill/102nd-congress/house-bill/776] (EPAct 1992). That sounds crazy given how long ago that was. We do energy policy roughly every 15 years. We had the Public Utility Regulatory Policies Act of 1978 [https://www.ferc.gov/media/public-utility-regulatory-policies-act-1978] (PURPA), which was transformative. We had EPAct 1992. We did one in 2005, but it was kind of small. So that’s really the last big one. When EPAct was passed, within 10 years we built 200 gigawatts of natural gas combined-cycle generation, because suddenly there was an incentive for people to build the lowest-cost source, which at the time was natural gas. Within 10 years, the nuclear fleet went from running at 60% capacity to 90%, because utilities had an incentive to dispatch their lowest-cost assets. So I think we should hold that as a minimum measure of success: within a decade, a complete transformation of the US grid. Right now you have in the queue all the generation you need to fully decarbonize. If we don’t deploy that quickly, we didn’t get the rules right. Some of what we’ve done is top-down and mandatory, but a lot of it is just changing the incentives. For example, we have provisions that say: if a utility is investing to decongest the part of the grid you’re on and bring prices down, why don’t we let them make a little more money? Instead of seeing that as a zero-sum fight. If a utility deploys what are known as grid-enhancing technologies, tools that lower line losses on their grid, why don’t they get to keep some of those savings and give some back to the ratepayers? Right now, all of those things are zero-sum fights. So a lot of what Congressman Levin and I have done is to make utilities partners in this, the way EPAct ‘92 gave utilities a pathway to preferentially build the lowest-cost assets. It’s time to update that bill. The measure of success: let’s be ambitious. Once we’re having a conversation about how zero-marginal-cost supply competes in a market awash in zero-marginal-cost supply and still gets paid to generate, that’s when I know we’ve succeeded. Tahra Hoops: That all sounds great, and I hope we can get past the gridlocked Congress. Midterms matter so much. But I want to look beyond this bill. You spent four years working on this, and it’s incredibly politically salient right now. What are the top issues you’re focused on, and where do you think you could make the biggest impact this Congress, outside of this bill? Rep. Sean Casten: The stuff we’re really focused on, and you mentioned that my committees are mostly financial regulation, I’m really increasingly concerned that our next financial crisis is either going to come from crypto or from climate change. Both are creating massive systemic risks. We spend a lot of time trying to identify where those risks are pooling in our financial connective tissue. On the climate side, here’s a little example: six of the top seven most uninsured housing markets in the country are in Florida counties. Miami-Dade is number one. Broward County is number two. I think Harris County, Texas, is number three. And then it’s a bunch more Florida counties. Twenty percent of all Florida homeowners are in the state insurer of last resort. If that insurer goes away, they have no coverage. The total value of Florida real estate is about three times total Florida GDP, which means it would only take one Category 5 hurricane to essentially force the state of Florida into bankruptcy. I’m not being hyperbolic. Just run the math on how much of a hit you’d need. The part of this I think is bipartisan: we’ve never really done a good job of monitoring systemic risks in our financial system beyond a handful of systemically important banks. As we saw with the 2008 financial crisis, if the risk goes off the bank balance sheet and onto an insurance company’s balance sheet, our regulators stop watching it. We made some changes after the financial crisis, but now you’ve got a scenario where the risk goes straight through the insurer onto the property owner, who just says, “I’m not going to get insurance because I can’t afford it.” Where does that risk start to pool? And our financial regulators, particularly in this Trumpian moment, are politically scorned if they even ask the question about climate financial risk. And yet we know those risks are there. But really the government should be, in the words of Jack Handy, I’d rather be rich than stupid. Gary Winslett: Fair enough. Tahra Hoops: I live in Los Angeles now, and for the first time in over a year, we drove down to Pacific Palisades and part of Malibu, which over a year ago was completely burnt down. To see all the structures that were so iconic, and now it’s just complete rubble with not much work having been done. A lot of it is due to the insurance problem we’ve been facing here. It was something they were trying to ignore, and then the wildfires blew it up in everyone’s faces. To see it for the first time in over a year with my own eyes was a very shocking and eerie experience. Rep. Sean Casten: This is heavy. If you haven’t read the work of Spencer Glendon [https://probablefutures.org/about/team/spencer-glendon/], I would highly recommend it. He runs Probable Futures [https://probablefutures.org/], a former managing director at a wealth management firm who has gotten really into climate. One of the points he’s been making for a while is that our species 10,000 years ago survived in a climate very similar to the one we have now, except we were migratory. We need to start thinking about what it looks like to survive in a climate as volatile as the one we have now, because when confronted with this before, our species thought it wasn’t a good idea to tie all your wealth up into a single fixed asset in a fixed geographical location. We didn’t build cities on rivers or along coastlines because we couldn’t count on them staying stable. That’s a really scary prospect. But read the news. There seem to be a lot more migratory people now, aren’t there? Gary Winslett: It’s funny, in a couple of different ways over the last few minutes you’ve brought up housing, and that was something I wanted to ask you about. A lot of our first pillar at The Rebuild, and all the stuff we do on the cost-of-living blueprint, is about increasing the supply of housing. From your seat on Financial Services, what do you think is the single biggest federal lever that would actually move the needle on housing supply? Is it land use? Is it something to do with Fannie and Freddie? Is it something else? Rep. Sean Casten: Historically the stuff that has worked best and been most politically durable is lowering costs for first-time homeowners. I say “politically durable” because if you’ve never owned a house, the price of housing is daunting, and we’re seeing the average age of first home purchase going up. On the other hand, 60% of American households own their own home, and the majority of people’s wealth is tied up in their home. And if you want to lose your next election, bring down the cost of 60% of Americans’ primary source of wealth. If you don’t have housing, housing is a cost. If you have a house, housing is an asset. We want assets to inflate. We want costs to go down. So where Congress has been most effective is helping that first-time buyer get into a home, whether through tax credits or through programs like what we did after World War II, where at least if you were a white American you got a lot of opportunities for discounted mortgages. The things we call “the projects” were initially built as places for people to get stable housing, and generally that was very racially mixed housing. I’m oversimplifying, but not by much. But then the incentives to lower the cost of first home ownership were applied in very racially disparate ways. And so the projects became a racial thing. That wasn’t how they were first defined, and they worked. We saw home ownership spike with those programs. I think we’re close on doing a housing bill that would have some good stuff in it. We’ve still got to work out some kinks with the Senate, particularly on what a “financial buyer” of a home looks like and how to prevent financial buyers from coming in. That sounds easy if you just say “private equity is bad.” But then you ask: does anyone have a friend with some investment properties? Would they be covered by the ban? What about a firm that owns housing to provide temporary accommodation for people relocating for a job? I think there are some structural issues that don’t work in what’s come through the Senate, but I’m hopeful we’ll have really hefty credits for first-time buyers in a lot of different structures, because it’s worked in the past, and it stays away from that politically toxic third rail of lowering the price of everybody’s assets. I represent wealthy people in the suburbs. I would absolutely lose my election if I said, “You know what we need to do is multifamily zoning on your property.” Tahra Hoops: I appreciate your candor. Trump has even said himself: the thing about building more housing is it will lower housing prices. I understand that point of view, but I’m glad you brought up making it easier for people to own homes. I critique a lot that we are very much in a boomer economy, and it’s very difficult for younger generations to feel like they can get ahead. The economy used to feel like a waiting room. Now people feel like they can’t even get into the waiting room. I would love to pick your brain more, but we’re coming short on time. Let’s do some rapid-fire questions. Low effort, nothing crazy, just the first thing that comes to mind. What is something you think is too expensive, and you can’t say housing or electricity prices? Rep. Sean Casten: Junk fees. How much stuff do you get charged for where you’re like, “I don’t even know what value I got”? Every one of those junk fees is too expensive. Gary Winslett: When I bought a house I remember title insurance. I started looking into it and I’m like, there was no reason this should be this much. Rep. Sean Casten: Like every time you fly on an airplane. What am I paying for now that I didn’t use to have to pay for? Tahra Hoops: And what is a policy or innovation that you believe is underrated? Rep. Sean Casten: The Office of Technology Assessment [https://en.wikipedia.org/wiki/Office_of_Technology_Assessment]. It was this amazing office that provided technology assessments for every member of Congress, so robust that in my early years as an engineer and consultant, I’d read OTA reports to get smarter. I’d go in and say, “Let me tell you how paper manufacturing works. Let me tell you how steel manufacturing works. I’m investigating next-generation battery technology. How does that work?” Gingrich and the Republican Congress killed it in [ed. ‘95]. It has never been brought back. Rather than criticize Congress for not being up to speed on new technologies, I don’t think we talk enough about the fact that Congress created an agency specifically to keep us up to speed, and it was a choice of Newt Gingrich’s Republican Party to make Congress dumber. It hardly cost anything. A budget of about $10 million a year. Gary Winslett: Really Pennywise pound foolish. Rep. Sean Casten: Again, I’d rather be rich than stupid. That is a politically controversial statement. Gary Winslett: What’s something people don’t really know about your district that you find fascinating? Rep. Sean Casten: My district was the last home of Muddy Waters [https://en.wikipedia.org/wiki/Muddy_Waters]. Coolest guy who ever came from my district. You’d never know it. If you drive through Westmont, Illinois, right now, you wouldn’t think this is where you get the blues. But if you got the blues, got on the train, made it part of the Great Migration, came up north, inspired all these people, and finally had enough to put down a down payment and live in a little house in your final years, Westmont was the place to go. It’s a cool piece of history that runs counter to people’s stereotypes. This does not look like the heart of blues in America. Gary Winslett: That’s fascinating. I didn’t know that. I’m glad I asked. Tahra Hoops: And what is something that you think your district does really well? Rep. Sean Casten: We have really smart and thoughtful people. I’m a nerd at heart. I’m an engineer. Every time I do a town hall, or when we do polls, you realize there are soundbites that infect our public discourse that you can put on a sign. And then you go and talk to people, and they’re just very nuanced and very thoughtful and appreciate the complexities of issues. I don’t know if that’s true everywhere in the country, but I joke all the time that the smartest, most athletic, most charismatic, most talented people in America are all in Illinois’ Sixth District. Not just the 55% who vote for me, to be clear. Tahra Hoops: All of them! Well, this has been a lovely conversation. Thank you for all the work that you do. We definitely appreciate it. Thank you for taking the time to be here. Gary Winslett: Thank you. Rep. Sean Casten: Thanks so much for having me. Appreciate you guys. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.therebuild.pub [https://www.therebuild.pub?utm_medium=podcast&utm_campaign=CTA_1]

From 50-Year Opportunity to 11th-Hour Amendment: The Rebuild Conversation with Rep. Josh Harder

This week on The Rebuild, Gary and I sat down with Rep. Josh Harder for a second time, and I’m so glad we did. Rep. Harder chairs the Bipartisan Build America Caucus and has been one of the loudest voices in Congress pushing the 21st Century ROAD to Housing Act, a bill that, if passed cleanly, would be the most significant federal housing legislation in 50 years. The catch: an 11th-hour amendment called Section 901. It was designed to push institutional investors out of single-family housing, which sounds good on paper and polls well. In practice, as Josh walked us through, it sweeps in the entire build-to-rent category, 72,000 new rental units a year, and forces a seven-year divestiture timeline that would effectively kill the market. We talked about why Blackstone isn’t actually the villain people think it is, why the best way to punish corporate landlords is to build more housing, and what it’s going to take to fix Section 901 before the bill crosses the finish line. Josh and his co-chairs just released a letter with 76 bipartisan signatures trying to do exactly that– the largest bipartisan push on any substantive policy this Congress. If you care about housing, cost of living, or just want to understand how a good bill almost gets fumbled at the five-yard line, this one’s for you. Introduction Tahra Hoops: Hi everyone. My name is Tahra Hoops. I’m one of the co-hosts of The Rebuild, joined with our other host, Gary Winslett. Today we have a very special repeat guest with us: Representative Josh Harder. He’s a Democratic congressman representing California’s 9th District [https://harder.house.gov/]. He was first elected in 2018, flipping a Republican-held seat, and in May 2025 Harder launched the Bipartisan Build America Caucus [https://buildamericacaucus-harder.house.gov/], which focuses on reducing regulatory barriers to accelerate housing, energy, and infrastructure development. He serves as its chair. Harder has been active in pushing for federal housing reform, including the bipartisan 21st Century ROAD to Housing Act [https://www.congress.gov/bill/119th-congress/house-bill/6644/text], a major housing package currently under consideration, with a lot of debate around provisions like Section 901. That’s going to be the ongoing theme of this conversation, so we’ll dive right in. Representative Harder, how are you today? Rep. Josh Harder: I’m doing great. It’s good to be with you. Tahra Hoops: For listeners who haven’t tracked every single twist and turn of this bill (and there have been many), would you give us the quick spiel on what the now-amended 21st Century ROAD to Housing Act actually does, and why we’re calling it the most significant federal housing bill in decades? Overview of the 21st Century ROAD to Housing Act Rep. Josh Harder: This bill is a little bit of a franken-bill that combines about 27 other bills into one whole. But I really break it down into a couple of different categories. First, this creates incentives for cities and counties, local leaders across the country, to build more housing. If they build more, they’re going to get more money from the federal government. It also repeals a lot of red tape in things like the HUD building code. The big thing there is the repeal of the chassis rule [https://bipartisanpolicy.org/explainer/whats-in-the-21st-century-road-to-housing-act/], which is preventing us from building manufactured housing. As you and your listeners probably know, we’ve had very little, if any, construction productivity growth for many decades. So this repeal is a chance to actually lower housing costs by building more homes in factories, a really exciting move in the right direction. And third, it also expands categorical exemptions from federal permit review so we can actually build housing faster. This is the same sort of thing you’ve seen in states like California and others that have passed real pro-housing legislation over the last couple of years, the federal complement to that. It does a lot of great things, and that’s one of the reasons we’ve been pushing for it for the last couple of months. We’re hoping we can fix a couple of the last provisions and get this across the finish line for good. Gary Winslett: Before some of these provisions that we’re going to talk about got added, this was something to be really excited about. The first iteration that went through the House, I was just amazed at how good of a bill this was. Rep. Josh Harder: That’s right. This is our first chance to pass a federal housing bill in 50 years, so I think it’s really an exciting moment. It’s turned bittersweet, unfortunately, but that shouldn’t cause us to lose hope. We’ve come to this because of such a huge grassroots mobilization across the country to finally bring up housing as a federal issue. There’s been so much growth at a state and local level over the last decade or two. This is the first time we really have a moment at the federal level, and there are so many good ideas in this bill that are going to do a ton of good. One thing I’m really excited about is that this helps build more pro-growth zoning practices for cities that actually want to grow. We’re very consumed sometimes with cities that don’t want to do anything, but there’s a whole section of cities out there that really want to build more housing. They just don’t know how. This bill is going to have a lot of support to make sure those folks can actually pass pro-growth measures that accelerate more housing construction. So yes, there’s a whole lot of good things in here, and it’s the result of years of hard work. The Build America Caucus & Energy Permitting Gary Winslett: I’d love to talk about how it fits into your broader political trajectory. You launched the Build America Caucus last year to cut red tape, to get federal housing, energy, and infrastructure projects actually built. Where does ROAD fit into that broader project? Rep. Josh Harder: This is our top priority this Congress. It’s the reason we created the caucus, because there really was not a hub for this type of work. This work spans a lot of different congressional committees, and we wanted something that would be a little more collaborative. Frankly, there are also a lot of folks who weren’t on the main committee that manages housing (the Financial Services Committee in the House) who wanted to be involved in this work. We knew it was going to be bipartisan, we knew it was going to get a lot of momentum, and that’s why we created it in the first place. The second big effort we’re working on in conjunction with this housing bill is an effort to get an energy permitting bill across the finish line, to make it easier to build energy and lower costs, which I think is especially important when we’re seeing demand growth in artificial intelligence and data center construction across the country. That’s our second priority. But this housing effort is really the reason we constructed this caucus in the first place. Gary Winslett: It would be really great to see. It was so disappointing when we didn’t get EPRA [https://www.energy.senate.gov/2024/7/manchin-barrasso-introduce-energy-permitting-reform-act-of-2024] across the line in the last Congress. So it would be really great to see its successor be really good and do well. Rep. Josh Harder: There’s some real momentum. There are ongoing negotiations. Ultimately, we need a lot of trust. This administration has unfortunately created a bit of a political vendetta against clean energy projects. They’ve canceled solar projects that were days away from construction and actually offering power to homes. One real precondition for getting an energy permitting bill across the line is going to be some type of guarantee that this administration is actually going to support all-of-the-above energy, not just fossil fuels, which they clearly love, but nuclear, solar, wind, and geothermal. If we can get that type of commitment, the policy here is pretty well understood, with broad bipartisan agreement behind it. Really, the limiting factor at this moment is the trust to actually get a deal. Tahra Hoops: Trust seems to be a major key when it comes to any energy infrastructure project. Before we go off on a major tangent, it is just so politically salient right now. When you’re going outside in your car and you see gas prices being screamed at you, and at the end of the month you’re getting utility bills, knowing that remains a major priority for your caucus is always reassuring for us to hear. But to shift gears a little bit and get back into the nitty gritty: Section 901 Explained Tahra Hoops: Could you walk us through what Section 901 (which sounds very wonky as it is) actually is, how it kind of got snuck in there, and why we might have some faults with it? Rep. Josh Harder: There’s been a lot of concern over the last couple of years about institutional investment in single-family homes. Think about this as Blackstone [https://www.blackstone.com/] or BlackRock [https://www.blackrock.com/] (sometimes people get a little confused in the memes online) buying all the homes across the country, and that’s the reason housing prices are so high. I think most of the policy wonks who look at this issue will tell you that’s not entirely true. Institutional owners have less than 1% of the single-family housing stock across the country. But in some areas it can be a lot higher: in metro Atlanta, for instance, more than 30% of single-family homes [https://www.urban.org/urban-wire/institutional-investors-have-outsized-presence-southern-housing-markets] are owned by institutional investors. So certainly it is a concern, and there’s been bipartisan agreement on it. Trump has talked about this in his State of the Union, and he’s tweeted a lot about it as well. He’s said this is something we really need to fix. We need to get large hedge funds and private equity firms out of the housing business. That’s gotten a lot of support from the left wing of the Democratic Party as well, which is always skeptical about corporate ownership. There are real concerns there, and that’s why ultimately, in this bill, there was an 11th-hour change to put in a provision that would put some real limits on institutional ownership in the housing market. I think it was well-intentioned. Unfortunately, because it was drafted at the last minute and didn’t really have time to be heavily vetted, it has some real unintended consequences. This is Section 901 (that’s the section in the bill), and effectively it’s going to halt the production of a part of the housing industry called the build-to-rent category, which right now is building 72,000 new rental units per year, especially in areas of the Sun Belt like Arizona, where these are just going up like wildfire. So this provision is going to push out renters. It’s going to destabilize housing through mandatory divestment timelines that are going to compel these owners to sell their property and ultimately displace the renters who live there right now. The way I think about this and explain it to folks: it’s like trying to solve a food shortage by banning supermarkets. You are punishing the folks who are building the housing that’s actually going to address the crisis we’re seeing all across the country. Institutional Investors & Build-to-Rent Concerns Gary Winslett: My mom actually lives in one of these rented build-to-rent houses. She’s got a family member of mine with mental illness challenges, and they just need a house. But they don’t have the money to own one, so they rent one of these build-to-rents. If the company that manages that is forced to sell it because there’s supposedly some evil landlord, she’s got to move. I just don’t think that’s the intention people have when they think about institutional investors. As you noted, it’s less than 1% of the single-family homes. How did this become such a thing people focus on? Rep. Josh Harder: Everybody looks for a villain in politics. When you’re frustrated by the state of affairs, you want to find somebody to blame. So it’s no surprise that when we’ve seen housing prices grow more than double the rate of inflation over the last couple of decades, and when most young people can’t afford a house, there’s going to be a lot of anger out there. Somebody’s going to take advantage of that and try to divert it onto somebody else. Especially at a time when people are really skeptical of Wall Street (and understandably so), there’s going to be a lot of blame thrown on private equity. I think there’s a lot of damage private equity often does. You see consolidation in markets like healthcare where it really is a problem to have so much consolidation. But transferring that to the housing market is a very different situation, where there’s so much capital out there but ultimately most homes are owned by the people who live there, or by landlords that own just a couple of properties. I think the situation here is just that people are really frustrated and they want to have somebody on the other side who’s been responsible for creating all of these problems. Because if it was that easy, we could just fix it. We could just ban institutional investment and all of a sudden tomorrow housing prices would become affordable all across the country. Of course, that’s not what’s going to happen. It’s because we haven’t built enough housing. If we need to build millions of new units, that’s what we need to be focused on. The analogy here: if you actually look at the filings of some of these companies, if you look at Blackstone’s filings, they will talk about how one of the biggest risks to their housing portfolio is the risk that we might actually build more homes. Because if we do that, it would actually lower the value of their investments. So I tell folks, if you’re really frustrated about corporate ownership, the best way to stick it to ‘em is actually to deal with the supply issues and build the homes that we can all live in. Gary Winslett: That’s exactly right. When we build more supply, you have a lot more power on the side of the buyers and renters rather than the landlords, because now it’s the landlords who have to compete to find somebody to live in the house, not the renters trying to compete with each other over a very limited stock. Rep. Josh Harder: Yeah, absolutely. You can see this time and time again. Abuses by landlords go down when we build more homes. It’s totally obvious. When you have an alternative, where you can move across the street if you don’t like the person managing your home, then you have those options. The best way to give power to the people is to build the homes for them to live in. Tahra Hoops: It’s funny that this has such strong bipartisan appeal, and why Trump has been very vocal in his Truth Social posts about it, because he’s aware that people are very upset with the economy, as much as he’ll go on TV and say otherwise. But rather than changing some of his policies, like tariffs on construction material (which won’t help) or deporting our entire construction workforce (which also won’t help), doing things like that would be actual tangible efforts to lower the price of housing. But he doesn’t want to do that, because those are his favorite pet policies. So now he can jump in on this because his team will tell him it’s going to poll well, it’s salient to voters. He can put a very tiny Band-Aid on this, and to him, he’s fixed the problem. He can point to it and say, “I signed that, I got that across.” And while we know it won’t make any meaningful difference, what’s going to happen is that by the time people start to notice, he may be out of office, and we’re still stuck with the issue, which has grown even harder. But I wanted to get back to the specifics of the bill. Obviously, as we mentioned, it kind of snuck in at the very last minute, to the point that even Senator Schatz [https://www.schatz.senate.gov/] at one point said it was a mistake. But clearly it was not: it’s something that’s been doubled down on. Problems with the Current Language Tahra Hoops: Where do you think the current language overshoots itself? Would it be just the investor ban in general, or the fact that the text also catches net-new build-to-rent or renovate-to-rent housing? Rep. Josh Harder: I think the two biggest problems are the overly wide definition of what actually constitutes institutional ownership, and the divestiture timelines. It’d be a very different situation if you were saying there was a 30-year investment window for you to actually build a home, rent it out, and then maybe someday down the road you had to sell it, maybe to the person who lived there. Right now, the seven-year window that exists, given how long it actually takes to build a home, get all the permits, and do the construction, is just way too short. It would functionally completely kill this market. And then of course, as Gary said, you’re including a lot of folks, like the entire build-to-rent category, that just don’t belong here. This isn’t what people have a problem with. This isn’t some Wall Street billionaire owning a home and then doubling rents the next day. These are people actually building new homes. I think it’s unbelievably ironic that a bill all about trying to build more homes could very well have the opposite impact, which would be an absolute catastrophe. It would break my heart if we spent all this work trying to get something across the line, and it actually had the unintended consequence opposite of what we’ve all been working for. This is actually a very easy problem to solve if we want to solve it. The challenge is that there’s just so much desire from the White House and from folks in the Senate who are pretty wedded to an anti-corporate position that it’s going to be a little challenging getting folks to get to yes here. But we released a letter yesterday that had 76 signatures [https://alford.house.gov/news/documentsingle.aspx?DocumentID=1558] of members of Congress. That is a big deal. Just to put that in context, that is the largest bipartisan push for any substantive bill this Congress, for the last year and a half. And it was more than half Democrats, half Republicans, actually a few more Republicans than Democrats in the end. That tells you there is a huge groundswell of feeling that we can get this fixed while retaining the momentum and passing the bill. Worst-Case Scenarios Gary Winslett: You told The Dispatch [https://thedispatch.com/article/congress-housing-bill-investors-deregulation-abundance/] that you’re worried about fumbling at the five-yard line. If 901 stays in there as currently drafted, as you say fumbling at the five-yard line, what do you think the worst-case scenario is if that actually comes to pass? Rep. Josh Harder: The two worst-case scenarios are passing this bill as-is, or not passing the bill at all. Neither of those are acceptable, and that’s why we have to thread the needle here. We want to keep this momentum. The fact that we could pass the first housing bill in 50 years is a really important moment. This 11th-hour change that unfortunately has gotten a lot of bipartisan support has a real risk of pushing us in the wrong direction. But the second big risk: we pass this bill as-is, and the benefits turn out to be less than we’re hoping. The chassis rule doesn’t actually produce more manufactured housing. The incentives might not be enough money to cause cities to change their behavior. But the bans are pretty well defined. So unfortunately, one big consequence could be that this bill stops more housing than it actually stimulates. The reason that’s such a big deal is that 72,000 homes a year, over a 10-year timeframe, is a lot of homes. Blue State Exodus & Political Messaging Tahra Hoops: All of this is coming to a head while we’re having conversations on the side and noticing the data is showing us we’re facing a blue-state and blue-city exodus. It’s an immediate problem because it shows that people are looking around at the places they live in and the elected leaders they believe in, and they just don’t find it worthwhile to live there. It will also become an electoral problem: if we lose that, it’s going to make races that much harder to win. I think we have to come to a whole stop as a Democratic Party and look within ourselves and understand: people are leaving for a reason. If you look under the hood, you do see housing is going to be the largest driver of it all. So it would be a logical next step to make it easier to build. It gets to the point where it almost sounds a little boring to keep saying the same thing over and over, “build, baby, build,” but it keeps refraining from happening. And circling back to the seven-year timeline you gave: that is incredibly short in the period of getting to permits, getting to actual building, getting someone into a home. By the time that happens, it absolutely makes no sense to just build that home. There is a popular show right now called Euphoria. The main subplot is a lot of crime, drugs, crazy stuff. And then there’s one subplot of one of the developers: he just became a developer, he took over his dad’s business, and he’s trying to build in California. Every other scene is like, “Have you tried getting permits here?” I find it so funny that it’s worked its way into a very popular show. No one has any clue how important this is to me as a policy wonk, and it is really hard to get permitting over the line here. So what I ask you is: we are in a midterm year, and we do know that not having Wall Street in homes polls well. How do we make this message more politically feasible to the average voter who’s not going to spend as much time on this? Rep. Josh Harder: You’re totally right on the exodus from blue states. I saw just last week that California is going to lose a million school-age children [https://edsource.org/2026/californias-school-enrollment-crisis], which is a challenge to our public school system. We’re just seeing a shrinking in blue states because people can’t afford to live there. It’s not that they don’t want to. I talk to folks all the time whose kids are moving out of state because they just can’t find a home to buy. But I actually think the two bigger reasons are even more important. One is just the economic opportunity that is limited when you can’t actually buy homes. The best way to see it: with the AI boom in the Bay Area, so many folks are concerned about what AI is going to do to jobs. This is clearly a very productive moment. There are a lot of millionaires and billionaires being minted in San Francisco. Every other time we’ve had a virtual gold rush like that, we’ve seen a huge flood of folks from across the country going into that area to make sure that economic opportunity is shared by all. That was quite literally the Gold Rush. That’s how my family got to California. My great-great-grandfather got on a wagon train in 1850, and I think if it was a million dollars to buy a home in California, he probably would not have pushed that wagon train all the way into the state. The fact that we’re not able to build housing essentially means we’re not going to make sure that the economic opportunity created by any of these superstar cities is actually shared by enough people. The second issue I really care about is just the enormous amount of cynicism and apathy about our political process, and life itself, when you can’t actually afford to buy a home. People are really angry out there, and that’s one of the reasons we have to fight back some of the provisions that might not actually make people happier, like banning build-to-rent housing. That cynicism is so potent because people don’t believe they’re actually going to have a life better than their parents. The most important reason for that is they don’t think they’re ever going to own their own home. There are so many negative effects that come from this housing crisis. This is probably one of the most important policy issues we have across the country, and we are right at the moment where we can actually get this solved. To your question of how we do it: I think we have to work on people’s minds instead of their hearts. In their hearts, everybody gets this. But the analytical part of our brain sometimes shuts down when we think about housing. We have to persuade people that, on this issue where everybody wants to make it more affordable to own a home, the best way to do it is actually not by banning some of the folks who are doing that right now. It feels like it should be more intuitive than it is, but unfortunately that’s clearly not the case. If we can actually show folks that what they’re trying to do would do the opposite, we can hopefully get a little more momentum. Gary Winslett: On working with where people are, I’ve found the analogy that works for me the best is asking people: what do you think would happen to the price of used cars if you banned new cars? Any used car that was still in really good working condition, now that’s what rich people are going to want to buy up. That’s just going to jack up the prices of all the used cars underneath them. You’ve got to be able to break it down in those kinds of ways that people get. Rep. Josh Harder: Absolutely. That’s a great analogy. It’s odd that people understand supply and demand in so many different ways, but when it comes to housing there’s often a little bit of a blind spot. I think that blind spot is just: people don’t believe it’s going to happen. They see the cost, but they’re very skeptical the benefits are ever going to be shared. The only antidote to that skepticism is reality itself. When people visit a city like Austin, where rents have fallen [https://www.axios.com/local/austin/2024/10/15/austin-rent-prices-decline-housing-supply], they start to say, “Hey, it is possible to live in a city that a lot of people want to live in and not pay through the nose,” although it’s still pretty expensive there. If we can get out of the unfortunate loop we’re in right now, back to a virtuous cycle where people actually see the housing being built, they see prices fall. My hope is that virtuous cycle can be sustained. But we have to force ourselves back onto it first. Tahra Hoops: Yeah, I think once people start to actually see results is when the tides will change. A lot of people are just acting from a place of scarcity and financial nihilism. People don’t believe it can get any better, so they don’t want anyone to get let in, because right now they already feel like it’s not even enough for them. That’s why JD Vance has been so popular in putting the narrative that it’s just an immigration issue: it’s not that we don’t have housing, we just have too many people here. But to me, that’s anti-liberalism in itself, to instead say, “No, we’re closed, we can’t welcome you anymore.” And that’s why we have the housing crisis we have now. It just is mind-boggling to me, because a wealthy country would instead look and say, “Let’s build more so we can welcome more people in and have a better future for all.” To me, that is the most American ideal you could have. Rep. Josh Harder: Not only is it nihilistic. Go to any housing construction site and you’re going to see immigrants. I mean, those are literally the people building our housing. Not only is it anti-liberal. If you are super anti-immigrant and conservative, you still should want to make sure we have more immigration to actually build the homes that people live in. Because let me tell you: if you walk around the construction sites I see, you’re going to hear a lot of Spanish. Closing Thoughts Tahra Hoops: Well, I think that is all the time we have. Thank you so much, Representative Harder, for being on here and for doing the work that you’re doing. I did not know that was the largest bipartisan signage you have on that letter, so just seeing what an incredible feat is happening behind the scenes here, it’s very encouraging for us to see and hear, and I’m sure for the readers and watchers as well. So thank you again. Rep. Josh Harder: Thank you for the work you’re doing. Now let’s go out and get it done. Gary Winslett: Thanks. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.therebuild.pub [https://www.therebuild.pub?utm_medium=podcast&utm_campaign=CTA_1]

From Housing Crisis to Energy Revolution: The Rebuild Conversation with Tom Steyer

California’s affordability crisis isn’t slowing down — so we brought on Tom Steyer to talk about what it would actually take to fix it. In this episode, we dig into his plan to build a million homes in four years, why your electricity bill is so high and who profits from it, and whether California can lead a clean energy revolution that’s already underway around the world. Housing, energy, food costs — it’s all on the table. These are the questions Californians are asking every month when the bills come due. Introduction Tahra Hoops: Welcome to the Rebuild. I’m one of your hosts, Tahra Hoops, joined with Gary Winslett, and today we have an incredible guest. We are joined by Tom Steyer [https://tomsteyer.com], investor, climate activist, and candidate for Governor of California. Tom is the founder of Farallon Capital [https://www.faralloncapital.com] and the progressive nonprofit NextGen America [https://nextgenamerica.org]. He’s spent the last 15 years putting his own resources towards California ballot fights on climate, taxes, and economic fairness. Now he’s running on the most urgent issue facing the state: the cost of living. We’re thrilled to have him here to talk housing, energy costs, and what it would take to actually make California affordable. Tom, welcome to the show. Tom Steyer: Thank you very much for having me. Housing Crisis & Building 1 Million Homes Tahra Hoops: One of the reasons I was so interested to have you on is that I attended one of your housing talks a couple weeks ago in Los Angeles, where housing activists and yourself discussed ways to actually make housing affordable. It’s now one of the major promises of your campaign, to build one million homes in four years. That’s a huge promise. So what does the Governor’s office actually control that could help make those numbers achievable? Tom Steyer: There are a number of issues that have to be dealt with urgently, permitting, zoning, cost per square foot, and relationships with local cities and counties. In every one of these areas, we have to move with urgency. And let me say, this is an urgent issue because Californians cannot afford to live here anymore. The number one bill they have every month is housing. Getting this right is not a nice to have, it’s a have to have. We are in a crisis. There was CEQA reform [https://en.wikipedia.org/wiki/California_Environmental_Quality_Act] last year — the California Environmental Quality Act [https://en.wikipedia.org/wiki/California_Environmental_Quality_Act] — to try and improve permitting. I supported that publicly. There was a lot of opposition, but it got passed in the legislature. There was zoning reform last year too, which also faced opposition but got done. But there’s a lot more to go in terms of making the timing and regulation of house building as fast and cheap as possible. In some places in California, the fee to build a house is 20% of the cost of the house. That means the price goes up by 25% just because of fees. We also need to dramatically drop the cost per square foot of building. There are tens of thousands of permitted, zoned units in California that aren’t being built because they can’t get built to a price people can afford. There are technologies to build offsite and assemble onsite that are about a third cheaper right now, and people think the price could drop by half. Just to give everyone a sense of how harsh this is: the average first-time home buyer has gone from 28 years old to 42 years old. There are many people in California who think they’ll never be able to buy a house. And a house is not just some asset, it’s the place where you live, where you build a family, where you build your life. The last issue on the table is opposition from cities and counties. To a large extent, they feel that building houses is an unfunded mandate. When they permit units, they expect people to live there, and those people require education and health services that cities don’t have money for. So they push back hard. On that score, I think I’m the only person running for governor talking about this: I will call a special election right away to close a corporate real estate tax loophole that brings in $22 billion a year to localities for education and health. That should dramatically reduce their reluctance. There’s a carrot and stick here, if we’re providing this for you, we’re going to ask something in return. Modular & Offsite Construction Gary Winslett: Can I follow up on the modular points? We’re huge fans of that here at the Rebuild, we love technological solutions to the challenges we face. I had a whole piece last week on the American Housing Corporation [https://americanhousingcorporation.com] doing offsite building and assembling on site. As you say, it saves a ton on development cost per foot. How exactly would the state help with that as governor? Is that procurement standards? Tom Steyer: I think it’s procurement standards, permitting standards, and regulations. But it’s also that people are reluctant to try new things, and this is something whose time has come. When you talk about modularization, I think we’re actually at a stage beyond that. When I think about modular technology, I think about building rooms offsite, putting them on trucks, and taking a wide load down the highway. That’s not what I’m talking about. I’m talking about technologies that can easily build nine to twelve stories, the ability to build apartments much cheaper, as well as houses. Gary Winslett: So you’re talking mass timber [https://www.woodworks.org/mass-timber/], that kind of thing? Tom Steyer: Yes, we’ve looked at that for a long time. But a lot of this is about building walls and floors offsite and assembling them on site. It’s been done very successfully with some of the biggest builders and homeowners in the world. The technology is here. The question is how we get it moving, and making sure the jobs that come out of this are good-paying, organized jobs. Tahra Hoops: This all sounds like a no-brainer to me. I’m originally from New York City, which did a lot of building in the past. I grew up in a row home, everything was quite vertical. I’ve been in Los Angeles for two years now, and the first thing I noticed was just how flat everything is. I’d go on walks with my dog and think, we could be doing so much more here. Why do you think Los Angeles and California as a whole have been so slow to build? Tom Steyer: I think there are a couple of reasons. One is cultural. When people are used to low-rise, they can’t imagine high-rise. They find it unpleasant to think about. But if you build it, that was true in New York. Before they built apartment buildings, everyone said, “I’ve never lived in an apartment.” Then they built some really nice ones and people said, “It’s great living in an apartment.” The other thing is there are reasons in terms of liability for developers as to why we never build condos in California. We only build rental apartments and houses, and it has to do with differential liability laws. There are a bunch of things we need to change. But the biggest issue is there has been no sense of urgency. I went down to LA to look at a low-income housing site with the person who developed it, and they said it took three to four months after the building was fully built to get hooked up to the grid. No one can move into a building with no electricity. So that’s three to four months where you’re paying interest on your loan, paying all your costs, with absolutely no revenue. That’s outrageous. We need to stop saying “let’s have the meeting in three months” and start saying “we’re having the meeting this afternoon.” There has to be a sense of urgency. Including ADUs [https://hcd.ca.gov/building-standards/adu], let’s get going, get units built, and make them at a price point people can actually afford. Tahra Hoops: The process isn’t working. Tom Steyer: We have decades of knowing the process is not working. So let’s stop that attitude. Affordability is at the center of our campaign. The ability to pay your bills at the end of the month is the biggest issue in California, and this government in DC is crushing us. I know it’s just one station, but $8 gas, what does that do to your monthly budget? Energy Costs & Electricity Reform Gary Winslett: California has some of the highest electricity bills in the country, and you’ve made bringing those costs down a centerpiece of your campaign. Your pledge is to lower energy costs by 25%. How are you going to get that done? Tom Steyer: I know everybody feels like that’s impossible. Let’s be clear: California pays twice the average cost of electricity in the United States. If we drop rates by 25%, we’ll still be 50% over the national average. So when people say that’s a big cut, yes, it’s a big drop to a still-terrible place. The three big utilities in this state are legal monopolies. You’re not allowed to compete with them. And monopolies always overcharge and always produce terrible service. They always explain that nothing else is possible, that without them, we go back to burning trees. Here’s how utility economics actually work. Most people think electricity companies charge you for electricity, have costs, and the difference is profits. That’s not true. What they do is get a capital expenditure accepted by the Public Utilities Commission [https://www.cpuc.ca.gov] into what’s called the rate base, and they get a guaranteed return on that rate base. So their incentive is to get capital expenditures into the rate base. If you and I are running an electric utility, we could put $200 million into the rate base and make $20 million, or do the same project for $100 million and make $10 million. It’s very much in our interest to choose $200 million. There’s no incentive, in fact, there’s a huge negative incentive, to do things cheaply. That’s a perverse incentive. I’m not angry at these people; that is what the state set up. And meanwhile, there is a gigantic electricity revolution going on in the world. The cost of clean energy is incredibly cheap and getting much cheaper. The cost of batteries is incredibly cheap and getting much cheaper. It is much, much cheaper than fossil fuels. Several countries last year increased their electricity supply by 50% in one year. We’re talking about increasing ours by 2%. A ton of this technology is coming out of California. We need to be adopting it, not avoiding it. No one’s walking into a utility and saying, “There’s this great new technology that’s going to reduce our earnings, we should adopt it immediately.” We need a different system. Part of it is changing how we oversee the PUC. We also need to introduce competition. To put some numbers on it: solar and wind cost one to two cents per kilowatt hour. Batteries are a couple cents per kilowatt hour and dropped 80% last decade, with similar drops expected this decade. At PG&E [https://www.pge.com], we pay 48 cents per kilowatt hour at retail. Think about that. We’re moving to a world where local renewable energy generation with batteries is overtaking everything. But we have a monopoly here, it’s illegal to compete. We need to introduce microgrids, local competition. I’m not trying to destroy these companies. I’m saying you’re going to have to adopt the new technology. We’ll give you different incentives and pay you to do the right thing. But 48 cents versus four cents, that’s too big a gap. Natural Gas & the Clean Energy Revolution Tom Steyer: Everybody can see the cost of oil because you go fill up your car and get a different cost per gallon. It’s in your face daily. But nobody understands the economics of natural gas. Traditionally, natural gas is a local market because it’s hard to ship, you can’t send it overseas easily. Oil is a completely global market. Even though nothing changed in the United States, we’re paying dramatically more at the pump because something happened in the Middle East. We’re a net exporter of oil, but the global market immediately changes everything at the pump. Natural gas has been different. In the United States, we pay approximately three dollars per thousand cubic feet. In Europe, they pay $19 to $21 for the exact same amount. Why is that relevant? In Louisiana and Texas, they’re building multiple LNG terminals [https://www.eia.gov/energyexplained/natural-gas/liquefied-natural-gas.php] to export our cheap natural gas to Europe. And they’ve told us it won’t change domestic prices. Really? You more than double the demand and it doesn’t change the price? In what fantasy world does that happen? Renewables are already way cheaper than natural gas for everything. Once we have a global market, which the United States is determined to create, to fatten the coffers of fossil fuel companies, everything that happens around the world affects us. What we’re looking at with fossil fuels is a world that is already more expensive, already much dirtier, and already subject to supply shocks. And we’re saying, “That’s our future”? It’s incredibly dumb. Tahra Hoops: It reminds me of that joke tweet, typically the average person is wrong to say the president has a lever to make gas prices go up or down. But right now is the only time where that’s actually true, because he did pull that lever. California as a National Model Tahra Hoops: How can we actually ensure California is a model for a national cost-of-living agenda? We started the Rebuild because we thought Democrats weren’t doing enough. What’s your vision as governor to make that possible? Tom Steyer: Affordability is at the center of our campaign because it’s at the center of the mind of every Californian, all the time. If we solve affordability and also deliver the services people need, education, healthcare, home care, we actually become the model for the world. This is what the 21st century is supposed to look like: entrepreneurial, innovative, growth-oriented, and bringing everyone along. Working people have been getting the shaft for 45 years, and that’s why the affordability crisis is exploding. We absolutely have the ability to create the best society in the history of the planet. Literally. We are rich enough and smart enough to deliver everything we’re talking about. We just need to drive down costs and be smart. If we do that, we restore the California dream, and we show what a society is supposed to look like: inclusive, dynamic, entrepreneurial, and forward-thinking. California invents the future. This is our chance to invent a really bright one. Tahra Hoops: From the top of our coast to the bottom, we have been lead innovators. There’s been a lot of talk about people leaving California, saying it’s not the place to build and imagine anymore. I reject that. Tom Steyer: The thing a lot of people don’t seem aware of is that young people are enduring, not living. They feel like their chances don’t look bright. Many think they’ll never buy a home. Many think great public schools are beyond them. That is not okay. Restoring that dream in a new time, with a new vision, that’s honestly what this campaign is about. Tahra Hoops: As someone who is 27, I don’t think I’m buying a house next year— don’t have that in my plans anytime soon. Rapid Fire Questions Gary Winslett: Other than housing, what is something that you think is too expensive? Tom Steyer: Food. Electricity’s too expensive, housing’s too expensive, and food’s too expensive. We need to deliver delicious, healthy food to our citizens, and we can do that. We grow the greatest food in the world in this state. Gary Winslett: Food at the grocery store is right in your face, like gas prices. And people don’t feel like they can substitute down. You can try to do without something else, but you can’t not go to the grocery store. Tom Steyer: What people do is substitute unhealthy food for healthy food. That’s the real issue. People can buy food, but the food that’s affordable has been designed to addict them to it, and it’s terrible from a health standpoint. Gary Winslett: Last question, what is a policy or innovation that you think is underrated? Tom Steyer: Batteries. Batteries are going to change the world. The ability to have a long-duration, cheap battery solves all the problems, because the only issue with wind and solar is when the sun doesn’t shine and the wind doesn’t blow. With the right batteries, they’re not intermittent fuels anymore. They’re baseload. That’s where we’re going. But the second issue is cars. What is an electric vehicle? It’s a battery with a car built around it. This week, BYD [https://en.wikipedia.org/wiki/BYD_Auto], the biggest EV maker in the world, announced a $26,000 car that goes 440 miles on a charge, with one in development that goes 600 miles. Game over. The technology is here for an electricity revolution. When you burn fossil fuels, you lose about a third of the energy, and for a whole bunch of reasons, you really end up with only about a third. We’re going to electricity on a massive level. I wrote a book called Cheaper, Faster, Better: How We Win the Climate War [https://en.wikipedia.org/wiki/Cheaper,_Faster,_Better]. We’re not saying to people, “Buy a crummy, expensive car because it’s good for everyone else.” We’re saying, “Buy the cheapest car on the planet, and it’s amazing. And by the way, the pickup is fantastic.” Tahra Hoops: From a competitive standpoint, we are dragging behind. China has understood the power of batteries for a long time and has built a monopoly around them. We’re slowly catching up, and we’re shooting ourselves in the foot if we don’t get to a united front. Tom Steyer: The tech is coming out of California. But look, China doesn’t have any oil and gas. They have absolutely no political reason to prolong fossil fuel energy. And if you look at the history of the world, the country that dominates in energy runs the world. England dominated in coal. We dominated in oil. It’s over. The costs have crossed forever. Battery costs are going to go down 80% this decade. Fossil fuels aren’t going down. They’re subject to interruption. They’re dirty. And they aren’t even paying their actual costs, they’re turning those costs into the bill paid by the people in Altadena and Pacific Palisades [https://en.wikipedia.org/wiki/January_2025_Southern_California_wildfires], saying: you want to know the tax on our emissions? Your house. Tahra Hoops: I want to end on a positive note. Tom Steyer: If I sounded negative about energy, I’m actually sensing something completely different. We are absolutely going to win this. We are at the point where there’s no doubt who the winner is. The faster we get on that train as a state, the faster everybody benefits. Cheaper, faster, better. Why don’t we lead the world and produce the technology, much of which is unique to California, that we can use to create huge companies and world markets? Tahra Hoops: I love hearing that. Again, thank you so much for being on here. We wish you luck and can’t wait to see how far you’ll go. Tom Steyer: Thank you very much. I appreciate it. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.therebuild.pub [https://www.therebuild.pub?utm_medium=podcast&utm_campaign=CTA_1]

From IEEPA Overreach to SCOTUS Reversal: The Rebuild Conversation with Ed Gresser

In a landmark ruling, the Supreme Court struck down the Trump Administration’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs — a decision with sweeping implications for trade policy, consumer costs, and the balance of power between the executive and legislative branches. In this episode of The Rebuild Conversations, Tahra Hoops is joined by co-host Gary Winslett and special guest Ed Gresser [https://www.progressivepolicy.org/people/ed-gresser/], Vice President and Director for Trade and Global Markets at the Progressive Policy Institute [https://www.progressivepolicy.org/], to break down what the Court decided, why it matters, and what comes next as the Administration scrambles to find new legal footing for its tariff agenda. SCOTUS Breaking News: Trump’s IEEPA Tariffs Struck Down Tahra Hoops: Given the breaking news that came out today. SCOTUS ruled against Trump’s IEEPA tariffs. This is something that many of us were hopeful was going to happen even though it took many months, many weeks to get this opinion to come out, which was worrying many people. But as you look into the document and see that it is over a hundred, just about 170 pages, you see that the opinions were quite long. And Supreme Court justices such as Gorsuch really wanted to take his time understanding why he was filing his concurrences and why he was striking this down. So you were able to gain a further understanding of. How it took this amount of time. Ed Gresser Joins to Explain the Ruling Tahra Hoops: I’m joined today by my co-host Gary Winslett and special guest Ed Gresser. He is the Vice President and director for Trade in Global Markets at the Progressive Policy Institute. Ed is a leading expert on US trade policy. He’s worked at US Trade Representatives offices, and he has been following this case quite closely. We’re thrilled to have him here to explain the court’s decision. It means what might happen next and Trump’s recent press conference. So Ed, thank you for being here Ed Gresser: Thanks so much for inviting me. I’m thrilled to be here. Tahra Hoops: So I’m gonna kick it off with you. Top-Line Takeaways: Why IEEPA Can’t Be Used for Tariffs Tahra Hoops: If you could just go through like headlines, like what exactly just happened, what are the top lines that we should be pulling from this 170 page opinion and what is going to happen next? Ed Gresser: Okay, well the headlines are: Over the last year, the Trump Administration has put in about 15 decrees of various sorts, tariffs on all kinds of things, from lots of things from Brazil to, you know, cars and parts to whipped cream, claiming it’s made out of steel to… most things in the world. About two thirds of the tariff money has come from decrees on using the International Emergency Economic Powers Act, IEEPA. The dates to the 1970s meant basically to allow presidents to act quickly in, in the event there’s an outbreak of a war or a pandemic where you really don’t have time for Congress to legislate. The President can act fast and Congress can fill in and legalize things. In the succeeding weeks, which is actually how the Biden Administration used it at the outbreak of the Russian invasion of Ukraine. First to ban some imports, and then to have Congress put things in law, nobody’s ever used to be behind this, and it has proven to be an unconstitutional use. You’re not allowed to take the IEEPA law, which is pretty expansive, and override the actual congressionally authorized tariff system. Over the past year, IEEPA has brought in about $175 billion worth of tariff money. $5 billion from telephones, a billion dollars from makeup, $3 billion from clothes, $3 billion from toys, a billion dollars from fresh fruits and vegetables. So I think it’s kind of come home for a lot of Americans and where they live and where they eat and all that sort of stuff. The Supreme Court has now said, you can’t do this. So all of those decrees are now struck down. What Gets Reversed: De Minimis Rule, Consumer Fees & $175B at Stake Ed Gresser: One final example, he used it to cancel the de minimis tariff waiver. So that led to many, many... Tahra Hoops: just to stop you there, in case people might not be familiar, would you be able to walk us through what that rule is? Ed Gresser: Yeah, the de minimis tariff wave, de minimis meaning very little tariffs on purchases of $800 or less, So lots of people used it to shop online. In July they declared an urgency to cancel that privilege. So people are getting fees of $50 and $200 when they buy something from overseas and have it delivered to their home. All those are not canceled. The government will be responsible to pay back the money that it wrongfully collected— all this $175 billion. The Trump Administration obviously is very, very dedicated to tariffs, believes in them, wants to keep them. Trump’s Response & Next Moves: Section 122 Stopgap, Section 301 Plans Ed Gresser: Mr. Trump this afternoon responding to this said he thought the Supreme Court justices were bribed or someone influenced governments to do this. Tahra Hoops: Oh, he stated they should be ashamed. Ed Gresser: Yeah I doubt they’re ashamed. He said that he’s now gonna try to replace this set of arrangements, both the 10% worldwide tariff, the 15% tariff, and anything from the European Union or Japan. The 50% tariff on lots of things from Brazil and India. First with a kind of stopgap measure using an old law called Section 122 that allows you to impose emergency tariffs for five months which I think will be 10% or that’s what he said, and then try to replace it with country by tariffs using yet another law called Section 301. So I think basically you can expect one: a lot of turmoil over repayment of this money that the government wrongfully is holding. And two: much more sort of chaos and upheavals in US trading tariff policy and relationships with our neighbors and our allies and other countries as we get up toward the midterm election. Tahra Hoops: Okay. So just to summarize what this opinion details and what it is exactly targeting, as you mentioned it is the IEEPA tariffs and those are going to cover the 10% baseline on all liberation day partners. That’s kind of the liberation day tariffs, the higher reciprocal tariffs on dozens of countries, the drug trafficking tariffs on Canada, Mexico, and China. And the about 145% effective rate on most Chinese goods. Gary, did you wanna dive into what tariffs remain right now? Separation of Powers: ‘Regulate’ Isn’t ‘Tax’ Gary Winslett: So one thing I wanted to add on some of Ed’s points is that the court went out of its way to make sure that this was understood as the decision that was also about separation of powers. So if you go into the decision, they make very clear that IEEPA gives the President power to regulate in emergency ways, but that does not include the power to tax. That is an unlawful usurpation of Congressional authority. And it doesn’t make sense in the statute anyway because if you had some sort of true economic emergency, you know right after Japan bombs, Pearl Harbor or a pandemic or something like that, you’re not just gonna add a little tax to the issue that doesn’t do what you need to do. And nowhere in IEEPA, as it was written, do they discuss taxation at all. So you would have to imagine somehow that Congress had included it. This unwritten down power of taxation that they had secretly handed to the President in order to follow the Administration’s line of logic. And so for the court, this isn’t just about the economics of tariffs, as dumb as they are, and as much as you and I would point out they are unhelpful for the courts, this is also about pushing back against an imperial presidency. So it is not just that these tariffs do not make sense, they exceed presidential authority and that is why they were unlawful. So it’s not just that Trump has been taxing your groceries idiotically, he has been taxing your groceries idiotically and unlawfully. It’s this separation of powers thing that’s really important. Tahra Hoops: A key quote from the opinion is that there are nine things that the President can do under IEEPA is investigate, block, regulate, direct and comply, nullify, void, prevent, or prohibit. As you mentioned not a single one of those words is tax. None of them say tariffs. None of them say duties and they really try to pull apart the word regulate and its definitions, and clearly it felt irresponsible and was not able to convince the majority of the court because as you’ve mentioned, it is just unlawful to accept that definition, that interpretation that the Trump Administration was looking to do. Ed Gresser: That’s an important point, that constitutionally tariffs are congressional power and they are not the same as regulating commerce with foreign nations. The first enumerated power, number one: Congress shall have power to lay, collect taxes, duties, imposts and excises. And then five lines further down, Congress also has the power to regulate commerce with foreign nations. So the people, the Constitution, definitely felt regulation and tax were two different things. And the Administration’s argument in the case was taxation is a form of regulation, and the court didn’t buy into that. Tahra Hoops: I had a chuckle myself this morning seeing that the Court went straight to the founding: there is no taxation without representation. I’m like, wow. They are really giving you the basics here, and you guys are completely failing. As horrible as it is to read some of this, seeing that just gave me a little dark chuckle. How Far Trump Claimed the Power Went: Gorsuch’s Warning Examples Tahra Hoops: One of the quotes that I found from one of the concurrences through Gorsuch was just eye-opening because this is something that I have seen and called out for many times as both of you I’m sure have as well, is a quote that Gorsuch said that before us, the President says he may use IEEPA to equalize foreign domestic duties, or not. He may use it to negotiate with foreign countries, or not. He may set tariffs at 1% or a million percent. He may target one nation, one product, or every and nearly every product. It is the idea that he could do whatever he wanted and believes that that was the right of law. And obviously there are several examples that we’ve seen in recent times. The one that comes to mind is his recent call with the Prime Minister of Switzerland, where they had a conversation. He was not fond of the quote-unquote attitude that she gave, and he maybe thought about lowering the tariff rate, but because he did not like her attitude, he instead upped it. So I’ll open it up to both of you, your thoughts and findings on that. Congress on the Hook: Limits of 122/232/301 and GOP/Dem Silence Gary Winslett: I mean, he’s still gonna reach for whatever tariff authority he thinks he can get. They already went with 122 today. The thing about it is though, 122 is supposed to be about balance of payments and the trade deficit. 232 is about the national security implications in particular. 301 is about unfair trade practices. All of the other authorities he would use are at least circumscribed in certain ways. That is at least as long as Congress will step up and actually care about its own prerogatives. So with the 122 tariffs that he just promised, not an hour ago, those have a 150 day window and then they lapse unless Congress extends it. Well, now the ball is even more in Congressional Republicans’ court on this, and all along they’ve had the ability to fight back against this and haven’t. And so it’s just likely gonna be yet another iteration of Republicans pretending not to read the news that day, you can’t find them right now on this tariff matter. And it’s just really frustrating to see the Supreme Court take separation of power seriously, and Congressional Republicans doing everything they can to give a president more taxation authority, which is sort of one of the interesting things today. You would think normally Republicans would love seeing the Supreme Court say that the President actually has more constrained taxation powers than he thinks, and politics are just running in the total opposite direction of that. Tahra Hoops: I mean, I’m sure there have been few, very very few members of the GOP who came out such as Massie and Rand Paul, who understood that this is not a power that the President should be overextending. But you’re right, I have been asking myself: where is Congress? And the fact that he noted the use of 122 to be the one lever that he is going to fall on for, as he mentioned, is going to be much higher than what we have had in recent times. He is putting the blame on you guys. He understands that we are in a midterm election year and the very Congress that has been silent on the sidelines, even on the Democratic side, you now have a lot of eyes on you. Ed, I would love to get your thoughts on this. I know that you’re at PPI, but CNL has also put out a really great tariff tracker. Seeing the messaging, the policies, and the framework of the Senate and the House side for Democrats and how they have been responding to this and how you think they’re going to respond to this newfound light on the next steps of the tariff war. Public Opinion & Midterm Politics: Why Tariffs Are Becoming a Liability Ed Gresser: Thanks for mentioning CNL, They’re great. There’s probably been more polling on trade and tariffs in the last year than probably in the last 50 years put together. So we know a lot about what the public thinks, and you can sort of see why Republicans are so anxious and so unwilling to say anything. The public in general really doesn’t like this. They’ve thought about it for a year. It’s about 62% to 38% negative. That was the initial reaction in March and April of 2025. And that is exactly what people think about it today. Democrats almost universally oppose 90% to 5% typically. Independents about 75, 25% negative. Republicans mostly hung in there with Trump. So Congressional Republicans are under pressure from the public in general to break with Trump and from their core voters to stay with him. And so what they’ve tried to do is shrink into the background and say nothing and stay away from the issue. And up till a week and a half ago, House Republicans had in fact passed a kind of resolutionary house rule to declare all of 2025 is a single day. The reason for that is that you have a special right to challenge IEEPA measures through privileged resolutions that you can only offer once in a legislated day. So they declared the whole year a single day. That year, or that day, came to an end at the beginning of February, and you then did see people start to peel off. The House last week voted to terminate the tariff on Canada. They’re going to be voting for more of these things. So Republicans are kind of in a bind. They don’t wanna talk about this, they’re gonna have to talk about it. If Trump comes up to the midterm elections and says: we want you to be authorizing war tariffs, that’s a bad place for them to be. That’s not what they wanna be talking about right now. Tahra Hoops: So I, you, we all notice that a lot of the drop is happening because of the economic impacts that consumers are facing. Again, as we enter into a midterm year the economy is going to yet again be a number one priority with how people are voting. They’re voting with their wallet yet again. The tax foundation has noted that over the past year it’s been an added annual $1,300 extra expense on households. With IEEPA tariffs removed that is probably going to drop to around $400 per family, which is still a lot of money that people would like to keep to themselves because they don’t believe that their wages are being stretched as much. Real-World Impacts: Small Businesses, Uncertainty, and Farmers Hit Hard Tahra Hoops: So I would love to hear about, perhaps Gary, you’d be a great person to answer this, on how small businesses are going to be dealing with this now that one, they’ve gotten a little bit of relief for I guess the hour in between the announcement and the presser, and then also how they’re going to be prepping and planning for these upcoming tariffs that are going to be added on yet again from the consumer side, the company side, and the worker side. Gary Winslett: Well, so they’re getting hit in a couple of different directions. One is that the Supreme Court didn’t really land any sort of mechanism for businesses to get the money back, that they were illegally taxed this whole time. So there’s just no mechanism for them to do that. And the Trump Administration is gonna drag that out as much as it can. They’re not gonna get the money back that they were illegally taxed. But then also, you don’t quite know exactly what shape these new tariffs are gonna take. And it’s very clear that the Trump Administration so believes in these things that they’re going to do everything they can to impose new tariffs. I mean, it’s very predictable that they are doing this, but it’s not their only option. Like what Donald Trump could have done is say, well, I was gonna revive American Manufacturing, but the Supreme Court stopped me. And they would just end there and he could take credit for any good thing that happened, any bad thing is on the Supreme Court. But they’re just so dug in, Donald Trump loves these things and the coalition around him doesn’t know how to tell him no. And so they’re not just gonna pocket the gift that SCOTUS gave them. They’re gonna be trying these other tariffs, section 122, section 232, 301, all these different legal routes to more tariffs, but that means you don’t actually know exactly what is being tariffed and how much, which introduces yet more business uncertainty. And that’s extra problematic if you’re a small business. ‘cause you don’t have the inventory, you don’t have the ability to lobby for exemptions. You don’t have the kind of access to finance that a bigger business has. So all of the problems that this generates. For larger businesses is not great, but it’s extra harmful for smaller businesses, and so that’s just a couple of different ways they’re getting hit all at once in various ways for no reason. Ed Gresser: The farmers are really among the hardest hit groups in the United States. They are both paying more money for fertilizers and for implements, and for fences, for all sorts of tariff impacts. They’re losing their export markets to Canada, to China, to you, and the government or Administration is trying to compensate for that. We’ve reopened soybean sales to Bangladesh and we’ve done X with Guatemala, and it’s just not landing. Those aren’t substitutes. The other thing I would say is that as compared to a year ago… if they’re starting fresh. A year ago, this was all hypothetical and abstract. We had not had a big increase in 96 years. No one in living memory knew what it was like, and they were kind of skeptical about what Trump said. Now they have a year of experience and what has happened is trade balance said it was an emergency. It’s exactly the same as it was a year ago. Manufacturing, large slowdown in manufacturing hires and contraction as share of GDP growth. Now 2.2% last year, not terrible, but lower than every year during the Biden Administration. This has just not been a productive experiment, and I think the public has kind of internalized that. So, the challenge of persuading them to go through another year of this is much bigger than it was in April and February of 2025. Tahra Hoops: I mean, I just think back to after Trump was first elected and then you just saw Google search trends immediately skyrocketed to people like searching what is a tariff? So, you’re right, it has been so long for the nation to even understand what a tariff is, let alone to even conceptualize what the impacts would be as even though he was constantly saying during his campaign: “I am going to tariff this going to save the nation,” and just repeated it every single time he could. It was his number one economic tool. He says the only reason why he did not do so in Trump one was because COVID came around and he thought he was being too nice about it. If anything, he started off his presser today by saying he’s been pretty mild with how he’s been using tariffs, and now he’s just going to kick things into gear and just up what he has been doing before. Refunds Fight: Can Importers Get Their Money Back? Tahra Hoops: But I did wanna touch on one thing that was talked about a bit during the press conference. Is the whole idea of refunds when people had the idealized thought that this would come out and then we would start getting refunds from the tariffs that were illegally put onto US consumers and companies. Kind of like their own version of tariff rebate checks that they have been floating around that were never going to happen. Kavanaugh noted in his dissent. That the United States may be required to refund billions of dollars to importers who already paid the IEEPA tariffs, even though some of the importers may have already passed it on to consumers. He called the refund process a mess, and notes that, as he says, consumers were paying some of that. When that was brought up to Trump during the press about Peter Ducey. He goes, yeah, you think the opinion would’ve included something on how we could do so? Looks like it’s going to have to be litigated from anywhere to two to five years, meaning that the Administration has no intent to refund the people back. So I would love to hear both of your takes on that. Gary Winslett: I mean, just as a factual matter, it’s not true that there’s no technical mechanism to pay people back. Virtually all the payments get done electronically. You could pay them back very quickly. It is a choice not to pay them back, not just some law of nature, like the money disappeared or something. Ed Gresser: Yeah, that’s absolutely true. And it is not unusual for the US government to do this. Last year the Internal Revenue Service paid back over $100 million in extra withholding penalty to a number of $328 billion. They do this routinely every year. The CBP knows exactly how much money it’s collected in tariffs and who paid and when and what law they came under. So it’s not difficult to do there’s no mess involved. Tahra Hoops: I just found that to be funny, the language that they were quickly going to use and something they might continue to fall back on. They would love to litigate their way out of this mess. They have been taking in so much tariff revenue, the idea to give it back somehow, as Trump has been saying, would be an economic disaster. That is why he has to rely on other avenues, such as section 122. Wrap-Up: Trade ‘Deals,’ Ongoing Uncertainty, and the Midterm Message Tahra Hoops: We’re coming close to time and I wanted to end with one quote again from the dissent that I, again, found laughable as I was reading it. From Kavanaugh, as he stated that the court’s decision could generate uncertainty regarding those trade agreements. This is referring to the ongoing trade agreements that Trump has made with other countries regarding IEEPA. Now that they’re reversed, we are now stuck in an environment of uncertainty, something we have clearly not been through before in the world of tariffs. Ed Gresser: I’ll only say that, just to use one example last year, the Administration put America’s European allies through miserable negotiation rounds and wound up with a so-called deal, but legally, flimsy, they’re not very stable. But then within weeks, Trump was threatening to put tariffs of 25% on Denmark and Finland and UK and many other European countries because he got upset over Greenland. So the idea that there’s some stability or seriousness to these agreements is not realistic. Tahra Hoops: Are there any last things to add on there? Gary Winslett: I think one thing that this does at least domestically is it does make it even easier for Democrats to rally around being opposed to these because you have this wing in the Democratic party that’s always kind of liked tariffs, but Trump’s tariffs put them in an awkward spot. They still tried to kind of fudge their way through it. But now that the tariffs are obviously illegal and an illegal usurpation of Congressional authority, then I think that really should be the last thing to bring on all of the Democratic party into these are bad and we need to oppose them and that Trump has been illegally tariffing your groceries a key message line from now through to midterms. Ed Gresser: There is a lot of, at least among Congressional Democrats, there’s a lot of unity among on the idea that you can’t have a situation where a single person is able to create whatever taxes he wants on whatever given day, and that they will hold together on that, the tariff issue until Trump is gone at least. Gary Winslett: Yeah. Tahra Hoops: Well, Ed and Gary, thank you so much for joining me on a Friday afternoon. I think we can all agree that in the midterm election is going to be focused on affordability. Trump has given them a really good message line. He has been illegally taxing your groceries, your goods for quite some time, and we should fight back by voting for Democrats this year. Thank you guys. Have a good one. Ed Gresser: Thank you. Gary Winslett: Bye. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.therebuild.pub [https://www.therebuild.pub?utm_medium=podcast&utm_campaign=CTA_1]