The One Big Beautiful Bill: What’s at Risk for Clean Energy with Michael Thomas

Jun 9

Michael Thomas joins us to discuss the clean energy tax provisions and industrial stimulus in the Inflation Reduction Act, which have brought billions of dollars in private investment and added gigawatts of power. However, these provisions are at risk of being cut as the "One Big Beautiful Bill" makes its way through Congress.

Michael is a repeat guest and a data expert who has been tracking over 10,000 clean energy projects through his business, Cleanview. Since his last appearance, he's been highlighting the potential impact of these provisions. We discuss the challenges they face and how their loss would affect U.S. manufacturing and energy. Contrary to the name of the show, the loss of these provisions is not inevitable—Michael and Cody explore the ways we can all get involved to prevent it.

Episode recorded on June 6, 2025 (Published on June 9, 2025)

In this episode, we cover:

[2:45] Michael’s work since his last appearance
[8:34] Cleanview and its clients
[10:47] IRA’s impact on clean energy
[13:59] Billion-dollar investments in red states
[16:22] Cuts to clean energy in the Big Beautiful Bill
[19:25] Economic impacts in Republican districts
[23:11] Consequences of halting clean energy deployment
[29:45] The transfer of wealth behind the bill
[36:25] The Musk-Trump feud
[38:20] Actions people can take
[44:18] Timeframes for the bill to pass and go into effect

Cody Simms (00:00):
Today on Inevitable, our guest is Michael Thomas, and our topic is the clean energy tax provisions and industrial stimulus, largely from the Inflation Reduction Act that have brought billions of dollars of private investment and gigawatts upon gigawatts of power online and are at risk of being cut as the "One Big Beautiful Bill" makes its way through Congress.
(00:30):
Michael is a repeat guest on the show and does a phenomenal job using data to highlight challenges and opportunities in clean energy. Since he last joined us, he started a data business called Cleanview that tracks the progress of more than 10,000 clean energy projects. He's been posting nonstop about the impact of the clean energy provisions that are at risk right now. So I invited him on the show to talk about it. Contrary to the name of the show, hopefully the loss of these provisions and the massive impact on US domestic manufacturing and energy that would go along with it is something that is not, in fact, inevitable. There are ways each of us can get involved, which is something Michael and I talk about too. From MCJ, I'm Cody Simms, and this is Inevitable.
(01:23):
Climate change is inevitable. It's already here, but so are the solutions shaping our future. Join us every week to learn from experts and entrepreneurs about the transition of energy and industry.
(01:43):
Michael, welcome back to the show.
Michael Thomas (01:46):
Thanks for having me. Good to be back.
Cody Simms (01:48):
Yeah. Well, listen, the episode you and I recorded, gosh, probably two years ago or so now, maybe a year and a half ago, it was one of our more popular episodes. It's fun to have you back. And boy, you've been busy in preparation for this conversation. I spent the morning immersed in all of your LinkedIn posts that I've been loving for the last few weeks, and you have posted 35 times in the last three weeks about the bill that passed the House that's up for review in the Senate at the moment, that has broad implications on our global economy, or definitely our domestic economy. So I thought, hey, let's jam about it. Let's hear what you've uncovered and have some conversations. So that was the context.
Michael Thomas (02:27):
Awesome. Yeah, it's been a busy couple weeks and I think a really important month for clean energy, for our country, and I'm happy to be able to spread the word a little bit about it.
Cody Simms (02:37):
So maybe let's start with some backstory. Since you came on the show, like I said, a little while ago, and we talked about some of the reporting work that you were doing as almost like a homegrown investigative reporter where you had gone and immersed yourself in a bunch of Facebook groups and were looking at misinformation about clean energy that was making its way through local town and things like that, since then, you've started your own project, really focused on amassing a ton of data around clean energy project development. Walk us through a little bit of that, because I think that data that you've been collecting is actually the database you've been using to draw some of the conclusions about how the legislation will impact clean energy projects.
Michael Thomas (03:26):
Yeah, absolutely. So as you know from our last conversation, I run a newsletter called Distilled, and I write now a couple times a month about clean energy and climate change. And I've found over the years that one of the most helpful ways to answer a question like where is solar growing fastest or what is the state of play in clean energy is to look at the data. I'm very interested in data. I find it's a way of zooming out and getting context. I also find that for misinformation or for the misconceptions that people have about clean energy, data and context is really the best tool that we have. It's a way that you can zoom out and say, "Well, here's the larger picture."
(04:11):
So as I was telling a lot of those stories, I found myself often going into these government databases and spreadsheets and trying to answer these questions, and they felt like pretty easy questions. It'd be like, how much solar does Colorado have on the grid right now? And it would take me hours sometimes to answer that question in high fidelity and a good amount of recency within the last year or so. And I found that there was basically two options when I was doing that type of reporting and asking those questions to do that analysis. One option was, you had these spreadsheets and you had government files and public documents and all this stuff. I had spent hours pouring through that, and then 10 minutes making a chart and 30 minutes writing the post. So most of the work that I was doing was this data cleaning and gathering.
(04:55):
And then the second option was these old incumbent platforms that people have probably heard about. You can sign up for a Bloomberg terminal that'll cost you a hundred grand plus. You can sign up for Wood Mackenzie reports, and that'll cost you 25 grand a year per user. And there's all these big platforms out there that have been started for getting this information, but they're really inaccessible for most people and really hard for large teams to afford to have their whole team on it. So I set out about a year ago to build a platform that would solve that problem, really with me as the first user. I think we talked a year ago, and I was telling you about some of this and saying, "Yeah, I'm really just building this for me to start."
(05:35):
I did a lot of customer development. I talked to a lot of people. Funnily enough, I didn't listen to anybody. I just kept building the thing for me. Most people, for the first six months, were like, "I don't think this is very useful. I don't think I want this." And nothing really clicked. And then all of a sudden, last fall, I started to collect all this information about clean energy projects and started to connect the dots between a project and actual developer and look through these single purpose vehicle, LLCs, and go through public documents and develop what's effectively proprietary data. And all of a sudden things started to really take off. So in the last six months, doubled revenue every month. Every month actually, except for April, was huge growth. April was Liberation Day and a huge amount of uncertainty, everybody paused for a little bit, but May was right back up there. So the business has grown really quickly.
Cody Simms (06:24):
You actually just said Liberation Day. I just want to point out that you called it that for what it's worth.
Michael Thomas (06:30):
That's what they're calling it. Yeah, I actually have changed some of my views on this. I thought for a while, no, you just got to call it what people know it as. That's what the news reported it on. But I actually just read some polling this morning that found that if people are told about the Big Beautiful Bill, they pull up five to 10 percentage points higher in favorability versus if you call it the House Republicans bill, five to 10 points less.
Cody Simms (06:51):
Notice I did not start the episode calling it the One Big Beautiful Bill. To me, that's actually brilliantly named. I mean, Donald Trump is a very good marketer.
Michael Thomas (07:00):
Definitely.
Cody Simms (07:01):
And it reminds me of the School of Steve Jobs. Just say it's awesome, say it's beautiful, say it's wonderful, and people start repeating that, right?
Michael Thomas (07:10):
Yeah. Yeah. So cut that part out where I called it Liberation Day. We'll just call it a day of global chaos and global economic doom.
Cody Simms (07:18):
Okay, so sorry. So you ended up building this service, and it sounds like maybe a lot of your customers are project developers, clean energy developers and whatnot, and they're subscribing to it to get access to this data that you've amassed on projects that are either in the queue or that have been developed all around the country at the local level. Is that the idea?
Michael Thomas (07:38):
Developers are one audience. We've got one of the biggest developers in the world that recently signed up as a customer, but the two biggest categories actually are investors, so infrastructure investors, private equity groups, folks that want to deploy a hundred million or a billion dollars into clean energy projects over the next decade. And then the second audience is folks that want to sell to developers. So it could be potentially listeners to this podcast that have a climate tech startup that is doing some kind of software or hardware solution for solar developers or wind developers or battery developers. It's really hard to actually get a sense of who is active in the clean energy market in the US, who are the biggest players. And then the third audience is this other category that's like folks that are interested in following the industry. That could be analysts, consultants, nonprofits, folks that are trying to track what's happening in clean energy development.
Cody Simms (08:31):
Economic development offices, that sort of thing, I assume too.
Michael Thomas (08:34):
Yep, exactly. Business is called Cleanview. We're a market intelligence platform right now. The goal is to really track every clean energy project and every developer in the US, but long-term it's to be much broader than that and be a place that anyone can answer questions about where clean energy development, climate check development is happening, and track some of the most important players and projects.
Cody Simms (08:57):
I mean, you've made incredible progress on that in a year. Why I wanted to have you on the show today, obviously share a little bit about what you've been building there, but really then how you've been using the data that you have amassed to shed the light on what are the implications of the current House-passed One Big Beautiful Bill on clean energy. So you've been doing a lot of work there, particularly right now, to share the implications on clean energy, which is important because this bill is currently under consideration by the Senate. So we're at this critical juncture right now, and I think one thing to lose sight of, because we just went through this with the Democrats with Build Back Better, and then it ultimately became bifurcated into the bipartisan infrastructure law and the Inflation Reduction Act. And it was, I think, a unique moment in time then because Democrats had the "trifecta" for the first two years of Biden's term. So there was this important moment to try to get legislation out there.
(09:57):
Well, we're now in that same situation on the Republican side where you have president, House, and Senate that are all Republican majority. So there is this ability to pass significant legislation that can get through the Senate in a filibuster proof way, but it doesn't require the 60-plus majority to get through and break a filibuster. It can get passed through the Senate with literally just 50 votes because then you have the 51st vote being the vice president, which is how the Inflation Reduction Act passed on the Democratic side. So we're at this moment exactly where we were with mansion and cinema and everything on the Democratic side trying to get the IRA ultimately out the door, which originally was a big giant house bill called Build Back better that got slimmed down into eventually the Inflation Reduction Act.
(10:47):
We're kind of at the same moment in the Republican side, and it's a critical time to understand what is actually at play, what are the dynamics at play. So maybe take us a step back and just articulate for a minute what the overall One Big Beautiful Bill is trying to accomplish. And then let's get into the clean energy side of things. And I know you're not a political analyst, so I'm not certainly wanting you to fully analyze the bill itself, but I know you've spent enough time immersed in it to at least have a high level point of view.
Michael Thomas (11:18):
Yeah, absolutely. So I think it's worth taking one step back and talking about the Inflation Reduction Act. I know most listeners probably know the high level, but to recap, because that's so much of the context here, in 2022, as you mentioned, Democrats passed what was the biggest climate bill in US history, probably global history, maybe excluding some of the stuff that China has done. But it mobilized just this massive amount of investment in clean energy in America at a critical time when we're looking at, right now, modeling that says that we're on track for three degrees C of warming, really catastrophic consequences. We have all of this load growth or electricity demand growth coming from data centers now. But on top of that, electrification, reshoring, all of these things that really require a huge amount of investment.
(12:09):
The Inflation Reduction Act was a bill that really set out to create a popular climate policy. So back in 2010 or so, Democrats tried to pass a cap and trade bill that was not very popular, and Joe Manchin famously had some ad where he took out a rifle and shot it and said, "We're not going to pass this." The politics of that were that it felt like too much stick and not enough carrot. So the Inflation Reduction Act was trying to change that, and one of the ways that they did that was by bringing a lot of industrial policy into it.
(12:44):
So they said, we can cut emissions. That's really important. We can build clean energy. But what we can also do is take this moment at the beginning of the 21st century when solar, wind, batteries, all of these technologies are going to be the technology of the future that countries around the world will buy, and we can make that stuff in America. The goal was to really rebuild some of the manufacturing industry that America lost over the last 20 years, and in doing so, hopefully create a very popular bill that people would get behind and say, "Look at all the jobs created. Look at all the investment." So they passed this bill-
Cody Simms (13:17):
Very much a supply side, industrial side stimulus approach to driving decarbonization.
Michael Thomas (13:24):
Yeah, absolutely. I think that it's worth pausing here to just talk about what a remarkable success this bill has been. The amount of investment that has come back to America, the amount of manufacturing jobs, the number of factories that have been announced, it's been incredible. I mean, I don't think that if you had told me three years ago that this bill would pass, I would've predicted that there'd be such a success. I think I would've thought, "No, we're never going to bring these jobs back. Maybe the industrial policy is a little bit of show," but it's been transformational. There's been so much investment.
Cody Simms (13:59):
One of your posts, just to dive into some of your recent content, you talked about North Carolina in particular where you said there were over 300,000 manufacturing jobs lost in North Carolina between the year 2000 and 2010, and since 2022 when the IRA passed, there have been more than $22 billion of investment into clean energy manufacturing in the North Carolina economy.
Michael Thomas (14:24):
That's right. Yeah. A ton of factories have come, and one of them is I think a Toyota battery factory, multi-billion dollar investment, and that's really trying to reshore a lot of that manufacturing in a state like North Carolina. And you've seen that across the country. I mean, dozens of states across the country, most of them red states, have gotten huge amounts of manufacturing investment. The total amount of manufacturing investment per year has more than doubled. So it was flat. From 2000 until 2020 or so, completely flat. Every president, as far as I can remember, has said we're going to bring manufacturing back to America. Every single one of them has failed. And then, finally, we pass this bill and we see this manufacturing renaissance. So that's the context.
(15:07):
Of course, Trump wins. Republicans take the trifecta in November, and I think what happened at that moment is you started to see a lot of folks in clean energy and climate tech saying, "Okay, this is bad, but don't worry. Look at all the jobs in red states. Look at the investments. This has been popular." They're going to take the phrase "it was a scalpel, not a sledgehammer" to this bill. That's what Mike Johnson was saying, the GOP leader.
Cody Simms (15:32):
By the way, I assumed what would happen, just from my own perspective, is a lot of the consumer side stuff would get whacked, the $7,500 EV tax credit would get whacked, the benefits for doing home electrification and installing a heat pump in your home would get whacked, but that all of the industrial policy side stuff to spur manufacturing would not get touched, that that stuff is doing exactly what Republicans are wanting to see, which is drive more jobs in their districts, drive more on-shoring. It's the whole Andreessen Horowitz American dynamism thesis. A lot of it is being driven by some of these policies. And I think you had a stat that manufacturing under Trump 1.0 grew 5% in the US, and under Biden, it grew by almost 280%, as an example.
Michael Thomas (16:22):
Yeah. So I think a lot of people saw those numbers and, to be honest, fell asleep at the wheel. We had five months from November until this bill started to get negotiated. If you hear from some of the lobbyists on the hill and folks that were advocating for some of this, they're sounding the alarm bells saying, "This is not looking good." I think a lot of people were lulled into the thing, "Okay, there's not much we can do. They're probably not going to go that hard on the bill." And lo and behold, when we get the first bill text in early May, it looked really bad. There was a bunch of cuts. They were cutting a lot of popular programs, cutting the solar and wind tax credits, or phasing those down early, cutting some of the manufacturing investments. And then everyone's saying, "Okay, well, at least this is the worst case. From here, it gets negotiated, it gets better." And then I think a week later, the next bill tax dropped, and it got worse, the worst case you can imagine almost.
Cody Simms (17:14):
That's where transferability of tax credits went away, I think, as one example.
Michael Thomas (17:18):
Yep. The solar and wind tax credits go from a slow phase down starting in 2028, then going to 80%, 60%, 20% to just a hard phase out. And then two things that I think a lot of people might've missed is, they changed it so that in order to get these solar and wind tax credits, which if you look at the modeling, just deliver huge portion of the emissions reductions that the IRA was supposed to deliver, they said you have to start construction on a project within 60 days of the bill passing if you want to get this credit. So there's hundreds of gigawatts in the queue. Most of that is not going to get started in 60 days. There's just only so much supply chain, only so much construction, you can only move so fast. And then there's permitting delays.
(18:00):
And then there's also the foreign entities of concern policy where they say, it's very complicated, but basically, if you have Chinese parts or if you have Chinese ownership in some way or joint ventures, things like that, then you don't get the credits. They're trying to really force China out of the US supply chain. That basically touches everything, because if you go up the supply chain across everything in America, at some point, whether it's the aluminum, whether it's the solar, wafers, modules, all these different things, it somehow touches China. So it became a worst-case scenario, and now we're looking at a bill that if passed by the Senate would result in a billion tons more of emissions every year by 2035 compared to the baseline of the IRA staying in place. So to put that in context, with the signature of one bill, we're adding a Japan level of emissions every year, the fifth-largest emitter in the world, to the emissions, and then wreaking havoc on the economy and manufacturing, all this stuff, but it's just a huge impact on climate.
Cody Simms (19:04):
So let's talk about what impact would be economically, particularly on Republican districts, because those are ultimately, now it's at Senate, so it's almost at the Republican state level that matters even more than the districts. But maybe explain a little bit about some of the research you did. I think through Cleanview, your platform, you've analyzed over 3,500 projects that have either gone live or are soon to be live since the Inflation Reduction Act passed, and you've amassed quite a bit of data there.
Michael Thomas (19:35):
Yeah. So one of the things that we did was, we took every single project that has been built in the country going back actually to 1900s, so very far, every type of project, but for this purpose, really looking at from 2022 on what type of solar, wind, and battery projects have been built. And then looking at planned projects, we have a view of about 10,000 planned projects across the country, when they're going to come online, in many cases, the exact latitude and longitude or the county. So we matched that to which congressional districts they're in and then, of course, what states they're in for the Senate.
(20:10):
What that enabled was the ability to see that about 75% of all clean energy projects that came online between when the IRA was passed and today came online in congressional districts that are represented by Republicans right now. If we look into the future, that number gets even bigger. If you look at the plan capacity, it's about 80% of stuff that's going to come online the next decade is in Republican districts. I think the number's a little bit lower on the states. A lot of this stuff is happening in rural communities and even blue states, but the red state's really been growing the most. They've been outpacing blue states in terms of clean energy development over the years.
Cody Simms (20:50):
With Texas as the 800-pound gorilla there, I assume.
Michael Thomas (20:53):
Yeah. Texas, according to our data, is going to build about 33% of all clean energy projects or capacity in 2025. Last year was about 25%. So they're building just an enormous amount of clean energy in the state.
Cody Simms (21:08):
Which worries me because when it comes to trying to get senatorial interest in this, you're dealing there with Ted Cruz. I don't know that you're going to make a lot of progress, probably on the Texas Senate side.
Michael Thomas (21:18):
No, I think there's definitely better senators to look at. We could talk about some of those folks that are maybe in play and at least amenable, but I wouldn't say Ted Cruz is one of those senators, unfortunately.
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Cody Simms (22:33):
Let's talk a little bit more about the impact there on particularly Republican jobs, Republican districts of these projects, and then also talk broadly about the overall impact to the American economy if this amount of clean energy investment ends up not being realized. So maybe share a bit about what's happening broadly with energy demand, electricity demand in particular, demand forecasts, and what happens if we slow solar wind battery deployments, and how much is it likely to be slowed if these tax credits go away?
Michael Thomas (23:11):
Yeah, absolutely. I think looking at the future energy picture is really important because that drives so much of the economy. We need cheap energy to run our economy, especially if we want to do what Republicans want to do, which is win the AI race compared to China. So we're at this moment right now where, for the last 20 years, electricity demand has basically been flat in America. That was a lot due to energy efficiency gains, partly this offshoring of manufacturing, a lot of different reasons. But that's all about to change.
(23:43):
So we're at this inflection point where really just in the last year, according to some of the data that we've looked at, electricity demand has been just on this very steady climb. So we've gone from year-over-year growth of less than half a percent to, according to the last time I looked at it week or two ago, we're at 3.3% year-over-year growth and we're climbing even further. And I think all the projections are that that's going to continue from everything, from data centers, obviously the big story. But even if you think AI is all hype and it's about to collapse and just going to go away tomorrow, I don't think that's going to happen, but if that did happen, you'd still have a huge amount of electricity demand growth because you have tons of states that have passed electrification policies, that are trying to electrify transportation, housing industry.
(24:32):
One of the craziest stats I've come across is, one of the biggest sources of electricity demand growth in Texas is actually from oil and gas electrification. So they're basically taking these old rigs that are running on fossil fuels that they dig up to now trying to electrify that because it's just more cost-effective. So electricity demand is definitely rising, and we're at this moment where we need to meet that with an enormous amount of supply, and we need to build clean energy or any energy capacity at a pace that we haven't done in decades. If we take out clean energy, you're taking out a source of power that delivered about 95% of all new capacity additions in 2024, and you're left with basically natural gas in the queue.
(25:18):
A lot of people say, "Okay, well, we can have some natural gas. You need to run data centers 24/7 anyway, so gas, it's cleaner than coal, let's do it." The problem with that is that if you want to build any new gas power plants today, you're looking at about a seven-year wait because gas turbine manufacturers, over the last five years, said, "We got to really dial it back. All these climate pledges and targets are really going to hurt our business." They got burned over the last decade, and so they've really constrained the amount of manufacturing that they're doing.
(25:51):
You look at manufacturers like GE Vernova and Hitachi, they're saying, "We're not going to make more turbines. We're just going to do this capital discipline approach where we increase prices," and they basically have oligarchies on those markets. So there's not a lot we can do to really get new marginal capacity that wasn't expected before the early 2030s. If you want nuclear, you're looking at at least 10 years of wait time, even with new designs. So by cutting that off, we're going to squeeze the amount of power that we have while electricity demand is growing and prices are almost inevitably going to go up.
Cody Simms (26:28):
So 90% plus of capacity in 2024 being renewable gas turbines, having multi-year backlogs in order to build new gas plants. And I assume, if there are multi-year backlogs, it also means high demand, which means prices to buy those turbines are going to go up, meaning building gas plants will get more expensive as well. Like you said, nuclear long delayed times. And we built what? A couple of nuclear plants in your and my respective lifetime, I think, in the US. So hopefully there is a nuclear renaissance. I really hope so. But it's in the 2030s, probably more so than in the 2020s. What happens to this clean energy wave that, like you said, was 90% plus of new capacity on the grid in the last year, if some of these incentives truly do go away? Where are we from a power generation perspective in the next few years?
Michael Thomas (27:21):
Yeah. So we looked at all of the projects that are in the queue, these interconnection queues that are the waiting line to get onto the grid, and right now the real bottleneck, and we were able to look across 80 to 90% of all planned projects across the country through Cleanview Project Tracker, and we looked at when they're going to come online, and then compared that to the new house bill that would take away tax credits.
(27:48):
We consider any project that loses its tax credits as at risk. Doesn't necessarily mean it will get canceled and won't get built. There's definitely going to be some places where the return profile still makes sense for investors and where it's still cheaper at unsubsidized level compared to gas. There's going to be places, especially at the sunny locations, with high energy prices that that's possible. But just looking at the raw numbers, we found that 600 gigawatts of total capacity is at risk and expected to come online at some point in 2028 or later. We chose 2028 because the average clean energy project gets delayed by about 16 months. So even if you're expecting to build a project by 2028 and the deadline for those tax credits is the end of 2028, could get delayed and you could still lose your tax credits. Investors will be looking at that and debating whether they go forward or not with projects given that risk.
Cody Simms (28:41):
Michael, just to put that in context, the US has less than 200 total gigawatts deployed today, right? That's an insane amount of solar deployed today.
Michael Thomas (28:49):
Yeah, clean energy. And then if you look at our total generating capacity across the entire grid, everything we've ever built for more than a hundred years, we're at a little bit more than a terawatt, so a thousand gigawatts. So that number is about half of all generating capacity that's online in the US today.
Cody Simms (29:06):
That the US has ever built?
Michael Thomas (29:08):
Yeah. That could be at risk right now. Some modeling, I guess to look at it from another view, a model that Princeton's REPEAT Project put out. Folks may know Jesse Jenkins, he's prolific and does just great work on clean energy. His group at Princeton found that capacity additions just at a macro level in the US, when looking at the economics of it, would fall in half over the next couple of years. So going from last year, we've counted I think about 50 gigawatts of clean capacity that came online. We'd be looking at maybe 25 to 30 gigawatts added every year, so we'd be losing a ton of capacity.
Cody Simms (29:45):
So let's take a step back and try to give some benefit of the doubt here of why this legislation would get proposed in the first place. If I'm wearing a Republican House member hat, which I'm not, to be clear, and trying to think through, okay, I'm going to lay out an economic plan for the United States going forward, and my primary goal is, in that case, I want to extend the tax cuts that got created in 2017 under Trump 1.0. That, I think, is mission number one: make it so everyday Americans, this is the language I'm hearing, aren't paying more in federal taxes. It reduces everyone's tax brackets by a certain amount. There's also a ton of corporate tax cuts and whatnot baked in to that. But the general purpose here is, it's not even reducing people's taxes, it's making sure taxes don't go up because it would revert back to tax brackets that existed before 2017.
(30:41):
Those extensions are something like three trillion plus in costs to the US government to extend those taxes out further. So ultimately, the Republicans then are like, "Okay, how do we pay for this?" And as I understand it, the pay-fors are two things. One is whacking all these clean energy provisions and the other is some pretty significant proposed cuts to health care, to Medicaid in particular, all of which together still don't balance the deficit. They're still creating, according to the Congressional budget office, multi-trillion dollar hole in the deficit. So you have these four competing forces. You have, don't let taxes go up on Americans. You have, keep our manufacturing and energy base going. You have, make sure people continue to get covered by health care. And you have, don't blow the deficit hole even bigger at a time when interest rates are high and we're paying a lot of interest on that deficit. Those are four really hard things to navigate. How does this play out? That's my understanding of what's going on. I don't know if that's the accurate way of thinking about it. But how does this all play out?
Michael Thomas (31:51):
I think that math is really what put clean energy and all of the IRA programs at risk, because it was clear from day one they wanted to pass this massive tax cut or an extension of the tax cuts from 2017. It's worth noting that, yes, those do flow down to everyday Americans, but the vast majority is going to the top 1% or top 10% of Americans. So they're going to do that by taking away money from Medicaid, Medicare, and SNAP or food stamps. So I get the benefit of the doubt analysis, but it's worth saying this is a massive transfer of wealth from the poorest Americans, taking their benefits and giving it to some of the wealthiest Americans. So that's the goal of the program, is really to give these tax cuts to corporations and to some of the richest Americans.
(32:49):
I think the other logic, again, to extend benefit of the doubt or try to understand, if you hear what Scott Bessent, the Treasury secretary, says about this. He's arguably one of the rational or thoughtful people who has come into this administration. He still does crazy stuff and disagree with probably almost everything he says at this point, but he's easier to understand than Trump. Trump just says, "Big Beautiful Bill, we're going to pass this." But if you listen to what he said in interviews, the logic is actually that there won't be a deficit. They won't add that two trillion. The way that they're pledging that is they say, "Well, we're going to grow our way out of this." So the economy is going to go from a couple percent GDP growth to 4%, because we're going to unlock all of this growth opportunity with tax cuts, with deregulation.
Cody Simms (33:34):
It's trickle-down economics. We're not even cutting people's taxes, we're just preserving the cuts that already exist. That's the part that I don't get. They're not adding new tax cuts, they're just maintaining status quo.
Michael Thomas (33:45):
I can listen to an argument like that if it is based in some kind of reality. If there was any economist on the right or left that thought that we could actually grow our way out of a deficit like this and actually achieve those goals, I'd be like, "Okay, I'll listen to that argument. I'm open to that." I think growth is good. I would like to see the American economy grow. But there's no one that thinks that that's possible. We are not going to get to 4% GDP growth, zero chance.
Cody Simms (34:14):
Your data shows the best way to grow is to maintain these industrial supply side tax programs that are actually driving reshoring of manufacturing and are driving growth in energy. That's what I would assume. The question is just, how do you pay for them? You don't want to cut people's healthcare programs, and so you're basically trying to pay for them by asking Republicans to not extend tax cuts on the wealthy, which, boy, is an interesting soul-searching moment for Republicans that now arguably have a large working-class coalition. So, okay, how do they navigate all of this?
Michael Thomas (34:51):
Yeah. I think if you look at the demographic shift, the number of voters that have, forgot the exact figure, something like more than $80,000 per year or 100,000 dollars per year, if you look at that split of who voted Trump, who voted Harris in 2024, Republicans, for the first time in a very long time, won lower income Americans. So they're going to be taking away a ton of benefits from their voters, and the only reason that this works is because most people don't know.
(35:21):
I was just looking at this polling from Data for Progress this morning. They did a bunch of polling from people and ask them their views on the bill. The first thing that they start with is just asking them, what is the most important news story that you've heard in the last week? This is the week that the bill passed or the week after. And most people had no idea. It was like 15th on the list of news stories that people had heard about.
(35:44):
Then they started asking people later in the survey, "Hey, what do you know about this bill?" And some of the most common responses was that this was going to ban transgender people from joining the military, not in the bill at all. That is not a part of what they can do. It's a budget bill. And then are they going to cut SNAP? Are they going to cut healthcare programs? Nope. Most people don't think that they're going to do that. Are they going to cut clean energy? Nope. So most people just don't know what is happening. They have heard the messaging on this. And then this is that data point that I told you, this messaging of Big Beautiful Bill pulls 10 percentage points better. So I think that's why it's important to talk about it and really say what is in the bill and what is it doing.
Cody Simms (36:25):
How much do you think the Trump-Musk blow up over the last two days tries to start fixing that where people actually start realizing something's happening?
Michael Thomas (36:34):
Yeah, I think it's great. First of all, this is not the best side of me, but I like eating some popcorn and watching those blow up on Twitter happen like this, like everybody else, but I think it's potentially really damaging for them. I think it's a problem because Musk brought in this politically weird coalition of folks that maybe voted for Obama, voted for Trump, weren't quite sure in 2024. He brought in a lot of this tech right, a lot of folks that aren't all that politically active just have a distaste for politics, and I think he brings in a lot of swing voters that are important in those GOP districts. He also brings in a ton of money if he did care enough and did target some of those senators or House reps that would send some ripples and some fear. And then it does just raise awareness for what this bill is doing.
(37:25):
People are like, "Kill what bill?" They see the memes and the tweets going on and they get to then look into it. It raises awareness. And as more information comes out, I think what we saw in 2017 with the failure of the repeal of Obamacare, when Republicans couldn't do that, it was because all of a sudden more information started getting out about this, people started to understand what was in this bill, and more than 10 million Americans were going to lose health care, and it was deeply unpopular. Once people understood what was happening in the bill, it didn't really work. So I think that's really the same playbook here, is got to get more people to know. So if Musk is tweeting about it, that's good news.
Cody Simms (38:00):
Your 35 posts as well, helpful hopefully too. Maybe not quite the audience of Elon Musk, but a very influential one in our little clean energy and climate tech circles. So, appreciate all the work you're doing there too.
Michael Thomas (38:13):
Yeah, I appreciate it. All the posts have reached a million people on LinkedIn, which I'm very happy about.
Cody Simms (38:19):
It's amazing.
Michael Thomas (38:20):
My goal was really, it still is, to reach three million. That'd be 1% of all Americans would have learned something more about the bill, but it's definitely a drop in the bucket compared to Musk on Twitter. Also a drop in the bucket compared to what I used to be able to do on Twitter. I mean, I get 25 million impressions in a month or something, and I'm trying to find other places that I can meet people from different walks of life, different political backgrounds, political values, and so trying to post in different places.
Cody Simms (38:47):
So let's turn the corner then on what should people who are listening that can do something, what should people be doing? If you're a startup founder and you've got a team of employees whose business might be impacted by some of these changes, if you're an investor listening to this and you've got a portfolio of startups, or if you're just one of my friends listening to this show who also cares and wants to do something, what should we be doing right now?
Michael Thomas (39:14):
I think the first thing that I'd say is to reject cynicism and helplessness on this. I think the first thing we can all do is recognize that we do have the power to stop this. We've seen in recent history that big bills like this try to go through Congress, and it just depends on what Americans do. Do they show up to town halls as some Americans are doing right now and yell at their senators and say, "What? You're going to take away these benefits? And you're going to give the money to who?"
Cody Simms (39:46):
Just as a reminder, you cited the repeal of Obamacare in 2017, but I want again cite 2022, the original bill that the Democratic House passed did not get passed by the Senate. It got completely revised. And the Inflation reduction Act was actually a very slimmed down version of the original Build Back Better bill.
Michael Thomas (40:08):
Absolutely. So I think point number one is, this bill is not destiny. A lot of people talk about they have a trifecta, they can lose four people. I think smart people especially have a problem with this where they read too much news and they become cynical and think, "Ah, it's all just going to happen. We're all hopeless." But I think that's just not true empirically. Actionably though, what I'd say is that if you live in a state that has a senator that is on the fence on this, and those states are North Carolina with Thom Tillis, Maine, Susan Collins, Alaska with Lisa Murkowski, Kansas with Jerry Moran, and Utah with John Curtis, those are the five folks that have come out publicly and voiced concern about the clean energy parts. There's also a couple other holdouts for other reasons that maybe you want to push, maybe you don't, like Ron Johnson, Wisconsin, Josh Hawley in Missouri, and Rand Paul in Kentucky. Those folks are pushing for other things, so it might actually backfire. So I think those five states that I mentioned up front are important.
(41:09):
So I think calling those senators and saying, "Hey, I want this clean energy boom to continue. I want manufacturing to come back to America. I want to invest in America's future. I want to have abundant energy, not scarce energy." Talk about the messages that are going to resonate with them. Unfortunately, I don't think, "Hey, I want to solve climate change," is one that will. It would work with John Curtis. He's a good advocate. But I think framing some of that stuff.
(41:31):
And then if you don't live in those states, text your friends that do. My wife and I texted a couple people and just said, "Hey, mind sending an email or giving a call?" A couple of them did, and it adds a few more people. So I think that's one. And then the final thing I'd say is just talk about the bill. Write a post about it and just say explicitly what it is. You don't even have to get all that emotional about it or be too cheeky about it, like I am sometimes on LinkedIn. Just say, "Hey, here's this bill and why I don't support it," because most people don't have any idea what's in it.
Cody Simms (41:57):
I want to reiterate what you said about climate change, in particular, with these five Republican senators. People care about climate change, people care about emissions, but I think the rationale that we've heard these folks say in terms of why they're having some concerns on the bill is more about the loss of manufacturing jobs and the loss of energy projects in their states. So it's less about the global emissions problem, it's much more about here is a specific project in my state that is at risk because these tax credits or these various benefits may go away.
Michael Thomas (42:32):
Absolutely. Different folks are going to have different messages that resonate. So I started to pull through, as part of my research, what did some of these senators say about the bill? Why are they supporting it? All of them have some different reasons. Thom Tillis and North Carolina does care a lot about those manufacturing jobs. Lisa Murkowski is in Alaska where energy prices are like twice as much as they are in mainland US states, and they want energy independence and cheaper energy. You look at Jerry Moran, he's got a huge EV factory in Kansas that the states really bet on and given a lot of state incentives for. John Curtis has been courted by conservative climate caucuses over the years and does care about climate change, but he said we should really be investing in America's future and have this all-of-the-above energy strategy. And then Susan Collins has always been a swing voter. She's more concerned about some of the healthcare provisions and rural hospitals and some of the different provisions, but she has voiced some concern about the energy parts of it.
Cody Simms (43:31):
How do you navigate the argument that is a pretty common one for Republicans, which is to say, "Yeah, this stuff's all good. States should pass their own policies to incentivize it in their states. Taxpayers shouldn't be paying for it though"?
Michael Thomas (43:44):
Yeah. I think that, unfortunately, these states just don't have the funding for that, and there's no way that we could really do that. I think the other thing is that the benefits are really broad, and so they do benefit every American.
Cody Simms (43:58):
That's back to your argument of if you want to win the AI race against China, you need cheap electricity, for example.
Michael Thomas (44:05):
Totally. And you need it all over the country. So I think that in terms of geopolitical security and winning the AI race and growing the US economy, all of those things benefit if we all do it at the US federal level.
Cody Simms (44:18):
So what kind of timeframes are we looking at here? I mean, it feels like now is the moment to take action. Do you have any sense of what the calendar looks like for this as it plays out over the course of the summer? Is there any sort of date by when it must get resolved, because it's part of the budgeting process, in order to actually be realized in the budget?
Michael Thomas (44:39):
Yeah. So what House Republicans have said, and Senate Republicans have said, is that they're going to try to pass this by July 4th, which is when they go on recess. I think, historically, it's just harder to pass stuff if it goes later into the year. So they're going to really try to cram it in. So the Senate has it. They got back from their last recess this week, and they're in these committees negotiating, writing up bill text, and starting to release that. I think we saw some of the first versions yesterday drop, and we'll continue to see that this week and some of the early weeks of June, mid-June. And then from there, it gets debated, and then they maybe try to put it to the floor for a vote. So June is really the month.
(45:24):
I wrote this, and I do believe it, the next 30 days are going to be some of the most important days of this decade, maybe of the century. If you just look at how important this bill will be to total emissions, we're talking a billion tons every year that could be either added or not, and it's really the stroke of a pen and this one vote.
Cody Simms (45:45):
Michael, I texted you yesterday afternoon and said, "Hey, do you want to jump and record this thing based on the writing you've been doing?" So thanks for hopping on here with us, and we're going to try to turn this episode around really quickly, like you said, because time is of the essence for folks to hear it and understand it. Really grateful for all the work you're doing to just shine a light on some of the data that you've pulled up and share that. It puts things into a different context, I think, to see the implications on individual House districts, for example, or on individual states. So as part of the show notes, we'll try to publish a link to some of those articles that you've shared on LinkedIn with some of the great charts and data visualizations that you have. Anyone listening, go follow Michael on LinkedIn, I guess, would be the place to follow you now in terms of where you're posting, because it's really truly fantastic content.
Michael Thomas (46:33):
Thank you so much. I appreciate you having me on and giving me an opportunity to just talk about this stuff. I'm passionate about it and really want to see us, as a country, make the right decision, and I think all of us have an opportunity to influence that. So, appreciate you using this audience for that.
Cody Simms (46:50):
Inevitable is an MCJ podcast. At MCJ, we back founders driving the transition of energy and industry and solving the inevitable impacts of climate change. If you'd like to learn more about MCJ, visit us at mcj.vc and subscribe to our weekly newsletter at newsletter.mcj.vc. Thanks, and see you next episode.