U.S. spends the most stimulus but smallest share on green energy, Senate GOP stimulus bill would pull Cares Act funds from Fed, and more

Senate Republicans are proposing curbing the Federal Reserve’s ability to expand or create lending programs for businesses, states and local governments as part of an effort to free up funding for a new coronavirus stimulus bill.

A slimmed-down virus relief bill that Senate Republicans released Tuesday and plan to vote on this week would be partly funded by reducing a Cares Act appropriation passed in March from $454 billion to $250 billion. The Fed, working with the Treasury Department, has used $195 billion of that money to create lending programs to help businesses, corporations and local governments.

The latest coronavirus stimulus package introduced by Senate Republicans on Tuesday includes efforts to aid the mining and coal industries in a move already angering some in the Democratic caucus.

The Tuesday bill includes a bipartisan effort by Sens. Lisa Murkowski (R-Alaska) and Joe Manchin (D-W.Va.) to establish a critical minerals program along with another section that includes millions for research into extracting rare earth metals from coal.

Eric Rosengren, president of the Federal Reserve Bank of Boston, is calling on Congress to clarify whether the Main Street lending program can make riskier loans, which could help push more money out the door to companies fighting for survival.

Of the program’s $600 billion pot, $1.2 billion in loans had been completed as of Thursday, Rosengren told The Washington Post last week. A loan-by-loan breakdown issued by the Fed on Tuesday showed 118 companies that had gotten funds by the end of August, with businesses in construction, real estate, arts and entertainment, and manufacturing making up some of the largest shares.

The U.S. has spent the biggest share of its GDP on discretionary stimulus spending compared to other major economies, but it’s spent the smallest share on clean energy, per a new analysis from consultancy Rhodium Group.

Why it matters: To what degree the world invests in clean-energy technologies as it recovers from the pandemic-induced recession could go a long way toward reaching climate goals.

In Maine, state officials are working to help residents install 100,000 high-efficiency heat pumps in their homes, part of a strategy for electrifying the state. In California, an in-demand grant program helps the state’s largest industry—agriculture, not technology—to pursue a greener, more sustainable future. Across Appalachia, solar panels are appearing on rooftops of community centers in what used to be coal towns.

The Trump administration may have pulled the United States out of the Paris climate accord, but most states and many rural areas in America have developed their own plans for reducing carbon emissions and moving away from fossil fuels as they maneuver—often aggressively—to address the threat of climate change.