The Biden administration wants to give tax credits for unionized automakers that make electric vehicles, while excluding non-union companies such as Tesla, because it wants to encourage the companies to focus on elevating standards for working Americans, Energy Secretary Jennifer Granholm said Friday while defending the plan.
President Joe Biden is "very favorable" to organized labor, which "has raised the standard of living of so many Americans, and we want to make sure that we do everything possible to encourage that business and labor really focus on elevating the standards for everyday Americans,'' Granholm told CNBC's ''Squawk Box."
The tax credit being proposed lowers the price of an EV made in the United States, with the use of union labor and materials, by $12,500 for a middle-class family, according to the framework for Biden's $1.75 trillion climate and social spending bill.
Tesla, meanwhile, is the largest producer of electric vehicles and recently sped past a $1 trillion stock market value. That put it above the largest global automakers combined, including General Motors and Ford.
But the company, owned by Elon Musk, is not unionized, so the Tesla products would not be eligible for tax credits under the spending bill plan.
Granholm said the president believes unions can hope for his goal of creating an equal playing field, economically, as he wants to address the nation's wealth gap.
"He wants to have a policy that builds the middle class from the bottom up and the middle out, not the top down," she told CNBC.
Meanwhile, the National Labor Relations Board in March ordered Tesla to ask Musk to remove a Twitter post it deemed threatening and anti-union after he tweeted that his workforce is free to unionize, but they'd lose stock options and be forced to pay union dues, so they'd win nothing if they took that step.
Granholm on Friday also commented that she's "totally bullish" that the global market for clean energy will reach $23 trillion by 2030 and that the United States will not get a share of that market by "standing on the sidelines."
"We haven't put more alternatives onto the grid," she told CNBC. "We haven't put more technology into the vehicles to make it affordable for everybody, so that requires investment. That's why the tax credits associated with incentivizing the private sector to get off the sidelines on clean energy investment are so important in moving that forward."
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