New PPI Report Warns Virginia’s Energy Mandates Threaten Grid Stability and Affordability Amid Data Center Boom

WASHINGTON — The Progressive Policy Institute (PPI) today released a new report warning that Virginia’s rigid energy mandates are colliding with surging electricity demand from the state’s booming data center industry, creating a policy-induced risk to affordability and grid reliability that could undermine public support for climate progress. As demand accelerates and reliability pressures mount, the report finds that inflexible, technology-specific mandates are increasingly disconnected from economic and system realities.

The report, titled “The Virginia Challenge: Meeting Energy Demand Affordably,” is the third in a PPI series examining how rigid climate mandates and prescriptive technology requirements can threaten affordability and reliability when real-world energy demand and grid constraints are treated as secondary concerns.

“Virginia’s emissions success came from a pragmatic strategy that prioritized reliable, clean power,” said Neel Brown, Managing Director at PPI. “But the state is now forcing the retirement of the very resources that made that progress possible — just as electricity demand is exploding. When policy ignores reliability and affordability, the result is higher costs, greater risk, and eroding public support.”

Authored by Brown and John Kemp, an internationally recognized energy markets expert, the report finds that Virginia’s strong emissions record largely predates the Virginia Clean Economy Act and reflects a successful shift from coal to natural gas and nuclear power. The report warns that today’s rigid mandates, enacted before the data center boom, now risk delivering diminishing climate returns while increasing costs and reliability risks for households and businesses.

Despite this strong baseline, the state’s current energy strategy is increasingly strained by skyrocketing demand, capacity concerns, and mounting wholesale costs. With reliability and affordability at stake, Virginia faces a critical opportunity to recalibrate its approach before inflexible mandates erode both climate progress and public support.

Key findings from the report include:

  • Virginia’s electricity demand grew at an annual rate of 3.1% from 2019 to 2024 — more than triple the national average — driven primarily by the explosive growth of data centers in Northern Virginia, now the largest concentration in the world.
  • The Virginia Clean Economy Act mandates the retirement of nearly all natural gas and coal generation by 2045, even though gas and nuclear currently provide 87% of the state’s electricity and have been the main drivers of emissions reductions.
  • Despite this surge in demand, wind and solar together supplied only 7% of Virginia’s electricity in 2024, underscoring the gap between renewable targets and deployment reality.
  • Wholesale electricity costs in the PJM Interconnection region surged more than 40% in the first nine months of 2025, with capacity charges, paid to ensure grid reliability, tripling over the same period.
  • Virginia’s per capita emissions (10.8 tons) and carbon intensity per $1 million GDP (158 tons) are already well below the national average, reflecting pre-VCEA gains from replacing coal with lower-emission resources.
  • The VCEA’s rigid mandates, crafted before the data center boom, do not account for today’s demand realities, risking reliability shortfalls and rising costs if clean-firm power is retired prematurely.

The authors argue that inflexible technology mandates and statutory retirement deadlines, combined with a failure to adapt to rising demand, have created a structural risk to Virginia’s power grid. When affordability and reliability are overlooked, consumer costs rise, and support for climate action falters. The report urges policymakers to pivot toward outcome-based energy policy, expand clean-firm capacity, and treat affordability as a core indicator of climate policy success.
PPI’s analysis offers a roadmap for recalibrating Virginia’s strategy, emphasizing flexibility, reliability, and fairness, to maintain progress toward decarbonization while safeguarding the Commonwealth’s energy future.

Read and download the report here.

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi

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Media Contact: Ian OKeefe – iokeefe@ppionline.org

The Virginia Challenge: Meeting Energy Demand Affordably

THE CHALLENGE OF BALANCING CLIMATE AMBITION WITH REALITY

Virginia’s energy policy is at a critical inflection point. The rigid, technology-specific mandates of the Virginia Clean Economy Act (VCEA), which legally commits the state to a 100% carbon-free electricity grid by 2045, are on a direct collision course with the skyrocketing energy demand from its world-leading data center industry. In 2020, this landmark legislation was enacted by a Democratic legislative majority on a mostly party-line vote and signed into law by then-Governor Ralph Northam. The world has since shifted dramatically, redefined by a surge in electricity demand from an industry that is both a pillar of the modern economy and a monumental consumer of power.

This conflict poses a risk to the Commonwealth’s energy future. Unless Virginia adopts a more pragmatic approach that prioritizes reliable, clean firm power, i.e., sources that are both lowcarbon and available on demand, it risks severe grid instability. Such a crisis would not only jeopardize the state’s long-held advantage of affordable energy but could also paradoxically undermine its own climate goals by forcing reliance on less clean measures like prolonged coal generation and fuel oil peaker plants to maintain grid integrity.

To navigate this challenge, policymakers must first recognize the foundations of the state’s prior success. Understanding Virginia’s impressive pre-VCEA decarbonization achievements is crucial to charting a sustainable path forward that aligns its climate ambitions with the realities of its growing energy needs.

It is also important to note that while the VCEA primarily addresses carbon emissions from electricity generation, the largest source of emissions in Virginia is the transportation sector at 53%, followed by electricity generation at 23%.

Read the full report.

Jacoby for Washington Monthly: As Trump’s Greenland Threat Grows, Europe Begins to Find Its Voice

It has taken European leaders nearly a year to recognize what they were up against in Donald Trump. The 47th president has been browbeating and insulting them since he returned to the White House. He has called Europe a “decaying” continent led by “weak,” “incompetent” people who “are not doing a good job,” and his administration has vowed to “cultivate resistance” to continental governments, replacing them with far-right populists. Still, most European leaders have been afraid to push back, wary of alienating the great power that has guaranteed the continent’s security and prosperity for over 80 years.

But this dynamic appears to be changing as Trump ratchets up his threats to take over Greenland—the autonomous territory of a loyal NATO member—either “the easy way” or “the hard way,” with the use of force.

As recently as last fall, European leaders fell into two camps. The largest group consisted of what you might call “appeasers” like NATO Secretary General Mark Rutte, who never publicly questions or counters Trump and called him “Daddy” at last summer’s NATO summit. In the other camp, generally younger, less established, or no longer in public office, are the “rebels.” Among the most outspoken is former Lithuanian foreign minister Gabrielius Landsbergis, who warns that NATO is heading into its “twilight“ years and if Europe “doesn’t wake up, we might have to declare it dead.”

What’s been missing are sober, down-to-earth voices with concrete plans for how Europe can move toward a new order, out from under America’s shadow and able to defend itself against an aggressive, revanchist Russia.

Read more in Washington Monthly.

America and Iran Can’t Afford Trump’s Hubris

In recent weeks, untold numbers of ordinary Iranians have taken to the streets of their towns and cities to protest the repression and incompetent economic management of the country’s ruling theocratic regime. The regime itself appears intent on slaughtering its way to survival, murdering thousands of ordinary Iranians in what has become one of the bloodiest domestic crackdowns the world has seen in decades. Supposed moderates have closed ranks behind the regime, and cracks have yet to appear in the regime itself or among security services like the Islamic Revolutionary Guard Corps (IRGC). While its immediate fate remains uncertain, the regime’s long-term prognosis appears terminal: too much popular discontent with a regime too ideologically rigid and corrupt to face (much less solve) Iran’s severe economic problems.

Even if the Iranian people topple the present regime and replace it with a more liberal and democratic one that reflects the actual aspirations of the Iranian people, that new government may not see eye to eye with the United States when it comes to regional and global politics. But it would lack the current regime’s ideological zealotry and would probably not maintain Iranian support for terrorist and militant groups like Hamas, Hezbollah, and the Houthis that sow chaos and destruction across the Middle East and the rest of the world. 

For his part, President Trump threatened military action against Iran if it continues its crackdown — though it’s not clear what the use of force would actually achieve. Destroying some regime security services facilities — say, a few IRGC barracks — probably would not do much to stop the regime’s current killing spree; this is, after all, an existential question for the regime from Supreme Leader Ali Khamenei on down. Moreover, an American-led air campaign seems just as likely to disrupt protests as hamper the regime’s repression: many ordinary Iranians would understandably head for cover to avoid incoming missiles and bombs, while the regime would use such strikes to attack protestors as tools of foreign powers and pose as the defenders of Iranian sovereignty. Even if air strikes precipitated the fall of the present regime, moreover, it’s hard to believe that a new Iranian government that rose to power in the wake of American military action would prove entirely stable or legitimate even in the short run. 

Nor, for whatever it’s worth, do America’s regional partners — Israel and Egypt as well as Gulf monarchies Oman, Qatar, and Saudi Arabia — want the United States to take military action against Iran. Most Americans agree, according to a recent Quinnipiac University poll that finds some 70% of registered voters opposed to American military intervention in Iran. 

Fortunately, the United States does have smarter and potentially more effective policy options beyond the use of military force to support Iran’s protestors: cyber operations could disrupt the regime and its security services as they continue their murderous crackdown on the Iranian people, making coordination between elements of the security services more difficult and giving protestors more room for maneuver against them. It could also deny the regime the ability to censor and jam communication with the outside world, allowing Iranians to get their story out without regime interference. Functional American public diplomacy and support for civil society groups could also have proven useful in Iran today had not the Trump administration made them an early target of its lawless attack on the federal government; indeed, Trump slashed funding for initiatives intended to help dissidents and protestors circumvent internet shutdowns of the sort imposed by Iran’s regime.

It would also be useful for the United States to coordinate with its allies and partners in the European Union, bringing additional pressure to bear on the regime from governments that historically have had more avenues for engagement with Tehran. But President Trump’s insane impulse to seize Greenland by whatever means necessary has created a rift with America’s European allies that only consumes time, attention, and resources that could’ve been devoted to real problems — not just the Iranian uprising, but support for Ukraine in its ongoing fight against Russian aggression. Instead, America and its European allies find themselves in a wholly unnecessary crisis of Trump’s own making.

What’s more, the United States could offer carrots in the form of sanctions relief that could both buoy protestors and create rifts within the regime itself. Ironically enough, Trump himself has precedent here: he lifted sanctions on the new post-Assad government in Syria last year, and could make a similar pledge to do so in Iran if the regime changes there. And if Iranians were to, in fact, change their regime, it would certainly be helpful if the United States had some sort of foreign assistance agency to help any new Iranian government establish itself and take root — but with the destruction of USAID, no such agency exists.

But President Trump and his administration appear more interested in military action against Iran for its own sake, only loosely tethered at best to any political or strategic objectives — to say nothing of an actual sense of how the use of force might help achieve them. They seem to believe their earlier uses of military force — against Iran’s nuclear facilities last June, against small boats in the Caribbean and Pacific, and most recently against Venezuela — have been wholly unqualified and unblemished successes, leading Trump and his administration to level military threats not only against Iran but Colombia, Mexico, and Greenland as well. 

There’s a word for this sort of overconfidence: hubris. And hubris inevitably leads to nemesis: downfall and ruination. 

Weinstein Jr. for Real Clear Markets: Stablecoin Rewards and Their Quiet Threat to Community Banking

As Congress prepares to return from its winter recess, negotiations over another round of legislation to regulate the crypto industry are heating up. Whether Republicans and Democrats on the Senate Banking Committee can reach an agreement remains an open question. That is unfortunate, because among the issues that still need to be addressed, one of particular importance is the impact of crypto on lending to underserved communities.

Rural areas, inner cities, and economically disadvantaged communities rely heavily on community banks, typically defined as those with less than $1 billion in assets, for access to capital, credit, and basic financial services. Lawmakers on both sides of the aisle have long recognized this reality, which is why despite partisan differences they have supported initiatives such as the New Markets Tax Credit to expand capital and credit in underserved areas.

Protecting this lifeline of credit and capital is also a key reason behind the prohibition on stablecoins offering interest to customers, enacted as part of the GENIUS Act.

Read more in Real Clear Markets.

PPI Applauds Bipartisan Satellite Streamlining Bill to Strengthen America’s Edge in Space

WASHINGTON — Today, Mary Guenther, Head of Space Policy at the Progressive Policy Institute (PPI), issued the following statement regarding the Satellite and Telecommunications Streamlining Act introduced by Senators Ted Cruz (R-Texas) and Peter Welch (D-Vt.):

“PPI applauds this bipartisan group of legislators for coming together to help make the satellite industry more globally competitive through regulatory streamlining. As highlighted in PPI’s recent publication, ‘Competing for the Upper Hand in the Ultimate High Ground: The Modern Space Race Between the U.S. and China,’ the United States is in a strategic power competition with China, and a number of satellite services are critical to maintaining our technological leadership. Our current regulatory system for space is disjointed and overly burdensome, which makes it challenging for the innovative commercial space sector to out-innovate China.

“Beyond their significance to maintaining competitiveness with China, satellite services improve the lives of Americans every day by expanding access to internet connectivity, providing weather information, getting farmers the insights they need to be more productive, and enhancing national security.

“This bipartisan bill would take an important step toward simplifying the regulatory environment for the space industry and helping the United States remain the leader in space, which benefits all Americans.”

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Kahlenberg for Washington Monthly: Inside the Fight to Revive American Civics

In the age of Donald Trump, America’s multiple safeguards to protect against the rise of a strongman exerting authoritarian powers are being tested more strenuously than at any time in modern memory. The early results are not good. Congress has failed to jealously guard its powers. The Supreme Court has repeatedly deferred to the executive. Major media organizationsuniversities, and law firms have bent to the president’s will.

Things could be much worse, to be sure, but the erosion of liberal democratic norms has raised the importance of another crucial protection built into the American scheme: our system of free and universal public education. At its best, as Thomas Jefferson wrote, the teaching of history can help young people come to “know ambition under all its shapes” and the teaching of civics can “enable every man to judge for himself what will secure or endanger his freedom.”

This bulwark of liberal democracy, however, is also faltering. Schoolchildren do worse on civics and history exams than they do on any other subject. Only 22 percent of American students are proficient or advanced in civics on the National Assessment of Educational Progress and just 13 percent are proficient or advanced in U.S. history. Moreover, young people are not very enthusiastic about democracy. A December 2023 YouGov poll found that whereas only 5 percent of those over 65 agreed that “democracy is no longer a viable system, and Americans should explore alternative forms of government,” a shocking 31 percent of youth ages 18 to 29 concurred.

Keep reading in Washington Monthly.

PPI Calls for New National Autonomous Vehicle Safety Reporting Framework

WASHINGTON — The Progressive Policy Institute (PPI) today released a new report highlighting the need for a national approach for autonomous vehicles (AVs), especially as most regulation is fragmented between states.

The report, titled “Building Trust Through Transparency: A New Federal Framework for Autonomous Vehicle Safety,” and authored by PPI’s Andrew Fung, Senior Economic & Technology Policy Analyst, Alex Kilander, Policy Analyst with PPI’s Center for Funding America’s Future, and Aidan Shannon, PPI Policy Fellow, comes at a time when autonomous vehicles like Waymo continue to traverse American streets in record numbers. While these vehicles can drastically improve road safety, there is a lack of public trust surrounding AVs, threatening the industry’s expansion.

“Public perceptions of autonomous vehicles are still being shaped more by isolated incidents than by comprehensive data,” said Fung. “A unified national safety framework would replace anecdotes with evidence, giving regulators, companies, and the public a shared foundation to assess performance and build trust as the technology scales.”

The report calls for a two-layer approach:

  1. A public-facing dashboard that shows AV crash rates and safety comparisons between AVs and human-driving vehicles
  2. A granular, comprehensive database allowing regulators to gain access to comprehensive, standardized safety statistics needed for rigorous oversight

“Smart, standardized transparency can shift the autonomous vehicle debate from speculation to evidence,” said Kilander. “That shift is critical to improving AV regulation while allowing responsible innovation to move forward.”

Read and download the report here.

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

A Smarter Path Forward on Premium Tax Credits

Two weeks ago, Congress let another deadline pass by, failing to act on the year-end expiration of tax subsidies that help millions of Americans afford health insurance. This legislative failure has already begun to hurt Americans, with 1.4 million fewer people enrolling in health insurance plans on the federal marketplace. And despite months of legislative attention, Congress is no closer to a real solution to reduce health care costs for the American people.

Most Democrats are still demanding a three-year extension of the pandemic-era subsidies, with no way to pay for it. But while their plan did advance in the House, it stands no chance in the Senate. Meanwhile, most Republicans are still clueless on health care, unable to offer any real solutions to reduce costs. Even the Senate’s “pragmatic dealmakers” have failed to make progress, with deliberations stuck in the mud

It’s time for a compromise like the one that PPI proposed in September. Our plan would strike a sensible middle ground, preserving many benefits for low-income Americans but saving money by targeting subsidies to those who need them most. The subsidies would also be permanent, paid for by cracking down on unfair practices that insurance companies and large hospitals use to overcharge the federal government.

Congress Shouldn’t Repeat the Mistakes that Got Us Here

To understand why a compromise is needed, it’s worth recalling how these enhanced subsidies came to be. In 2021, Democrats temporarily expanded the Affordable Care Act’s (ACA) health insurance subsidies as part of their pandemic relief bill. The enhanced tax credits were designed for a health emergency, and were therefore unusually generous. But once the pandemic had subsided and the tax credits were set to expire in 2022, many Democrats argued that they should be made permanent.

To some extent, these Democrats had a point — the enhanced subsidies provided real financial relief and helped push America’s uninsured rate to a record low. They also eliminated the ACA’s “benefit cliff,” which caused enrollees to lose all of their benefits if their income rose above an arbitrary threshold. But moderate Democrats realized that the pandemic-era subsidies were deeply flawed. The benefit formula was skewed toward higher-income enrollees, with some families making over $300,000 per year being eligible for taxpayer support. And a permanent extension would have cost roughly $300 billion over ten years, adding fuel to our ballooning national debt.

At the time, my colleagues at the Progressive Policy Institute called for a permanent compromise. But instead, Congress chose the worst possible approach, extending the full pandemic-era subsidies for three years. Rather than solving the problem, lawmakers guaranteed that it would return in 2025.

A Better Way Forward

While Congress failed to meet its 2025 deadline for action, a bipartisan group of Senators is still hoping to find a solution (and make it retroactive). The details of this plan are still unfinished, but negotiators will surely be tempted to propose a temporary, deficit-financed version of the subsidies — nothing more than a repacked version of the ideas that have failed to gain traction for months. Instead of rehashing failed ideas, negotiators should get behind a sustainable and permanent solution to make health care more affordable.

If Senators are willing to take the second approach, they should turn to PPI’s proposal, which would enact a more affordable version of the subsidies and pay to make them permanent. Our plan would preserve free health insurance for Americans in poverty and would provide more generous support than the original ACA for people earning up to 350% of the federal poverty level. It would also eliminate the ACA’s benefit cliff, meaning middle-income Americans wouldn’t immediately lose all of their tax credits if they receive a modest raise. Crucially, the plan would cost just half as much as the pandemic-era subsidies, generating the greatest savings by scaling back subsidies for upper-income enrollees that don’t need them.

This proposal would be fully paid for through savings in the health-care system. It cuts costs by adopting site-neutral payments in Medicare, ensuring that the program pays the same rate for a procedure regardless of whether it is performed in a doctor’s office or a hospital. It would also crack down on upcoding in Medicare Advantage, the practice in which private insurers make their patients appear sicker than they really are in order to secure higher government reimbursements.

Not only are these proposals smart policy, but they would also undercut the strongest argument against the subsidies — that subsidies, on their own, do not drive down the underlying costs of health care. By cracking down on large hospital systems and insurance companies that siphon money from our medical system, these reforms could do more to reduce costs than any law since the Affordable Care Act.

The stakes are too high for politicians to waste time on unrealistic proposals or temporary fixes. It’s time for Congress to get behind a credible solution to reduce health-care costs and provide long-term security for the millions of Americans who purchase health insurance through the ACA’s marketplace.

Building Trust Through Transparency: A New Federal Framework for Autonomous Vehicle Safety

In October, Waymo, a self-driving car company owned by Google’s parent company Alphabet, released its latest safety report from its autonomous ride-hailing service. The data is one of the most extensive public views into self-driving vehicle safety to date, claiming a 91% reduction in serious injury crashes compared to human drivers, alongside fewer airbag deployments, fewer crashes with pedestrian injuries, and zero fatalities. Although the data is self-reported, if autonomous vehicles are truly as safe as Waymo suggests, it would be a major leap forward for safety in a country where road fatalities are a leading cause of death.

Yet despite the potential public health benefits, polls consistently show public trust in autonomous vehicles (AVs) to be remarkably low. A recent survey found just 13% of U.S. drivers said they would trust riding in a self-driving vehicle, while 61% would be afraid to do so. Such fears have given rise to a wave of backlash against the technology, with fierce opposition to the authorization of driverless ride-hailing services in cities and states across the country, along with proposed federal legislation from Senator Josh Hawley that would effectively ban driverless cars nationwide.

Part of what fuels these fears is a lack of easily accessible, comparable, and independent data about AV safety. While the public can access some limited information about AV testing, it is fragmented across federal, state, and local lines, and cannot be directly compared because of differing reporting requirements and platforms. In the absence of high-quality data, eye-catching headlines and anecdotes about negative individual experiences with AVs dominate discourse.

Undoubtedly, AVs raise real questions around liability, jobs, cybersecurity, and ethics. But they also offer immense promise to reduce crashes, improve independence for people underserved by public transit, decongest urban roads, and lower transportation costs. High-quality data should be the foundation of discussion about these complex topics, not anecdotal speculation.

The solution is a unified federal AV reporting standard. We propose a two-layer approach, designed to build public trust and give regulators the details they need to properly oversee safety. First, a straightforward, public-facing dashboard allowing users to view crash rates and compare the safety of AVs directly to human-driven vehicles under various conditions. Second, a granular, comprehensive database accessible to researchers and regulators, giving them the detail needed to shape regulation. Built to preserve flexibility and privacy while limiting reporting burden, this approach focuses on public accessibility while protecting proprietary information and continuing to foster innovation.

Read the full report.

Venezuela oil production is down 75% since 1998

FACT: Venezuela oil production is down 75% since 1998.

THE NUMBERS: Venezuelan GDP (constant 2015 dollars*) –

2024 $42.6 billion
1998 $94.1 billion

World Bank

WHAT THEY MEAN: 

Assessing last week’s raid on Venezuela and the arrest of Chavista chief Nicolas Maduro, PPI’s National Security Director Peter Juul expects little good to come:

“Now-former Venezuelan President Nicolas Maduro was a brutal dictator whose dreadful politics and policies, largely inherited from his equally autocratic predecessor Hugo Chavez, ran his country into the ground. The U.S. military operation that captured Maduro once again demonstrated the tactical and operational proficiency of the American armed forces. But neither Maduro’s autocratic governance nor the audacity and skill of the U.S. military in executing assigned tasks are the primary issue at hand here: at the whim of one man and with no real explanation or apparent rationale, the United States has launched an unwise and illegitimate military intervention that only undermines American interests and international security.”

What might be next? Trump administration comments and actions suggest three things. First, the admin. expects to “run” Venezuela for some time to come. Second, its apparent plan is to leave Maduro’s “Chavista” subordinates in place and hope they will cooperate with American managers. And third, U.S. and international energy companies will rebuild Venezuela’s oil industry as the basis for the national economy. Some oil data, then a couple of observations on the challenges a plan like this will face:

Venezuela sits on top of a large pool of petroleum. The U.S. Energy Information Administration and OPEC both cite a figure of 303 billion barrels of “proven reserves” of crude oil. This would be the world’s largest reserve, with Saudi Arabia second at 267 billion barrels and Iran third at 209 billion. (The U.S. has about 45 billion.) The two sources diverge a bit on the worldwide reserve total — EIA guesses 1.80 trillion barrels, OPEC 1.57 trillion — but either way, a 300-billion-barrel figure for Venezuela would be a sixth or maybe even a fifth of the world’s currently recoverable crude oil.

A lot of oil, then. But so far it hasn’t done Venezuelans much good – rather the reverse.  Maria Corina Machado’s Nobel Peace Prize address last December explains:

“The concentration of oil revenues in the State created perverse incentives: it gave the government immense power over society which turned into privilege, patronage, and corruption.  … Oil wealth was not used to uplift, but to bind.  Washing machines and refrigerators were handed out on national television to families living on dirt floors, not as progress but as spectacle.  Apartments meant for social housing were handed to a select few as conditional rewards for obedience.   And then came the ruin: Obscene corruption; historic looting. During the regime’s rule, Venezuela received more oil revenue than in the previous century combined. And it was all stolen. Oil money became a tool to purchase loyalty abroad while at home criminal and international terrorist groups fused themselves to the state. The economy collapsed by 80%. Poverty surpassed 86%. Nine million Venezuelans were forced to flee.”

And looking ahead from this point of inflection, there are some good reasons to believe a rebuilding plan centered on energy income isn’t likely to work: challenging at best for objective reasons, relying on partners who probably aren’t very reliable, and maybe the wrong strategic direction in general.

(1) Objective problems: The Chavista governments may have exaggerated the “300 billion barrels” figure for political reasons, so it should be thought of as a “theoretical maximum” rather than a firm number.  And whatever the actual reserve level, Venezuela’s oil is pretty low quality — “heavy” and “sour” as opposed to the “light” and “sweet” refiners usually prefer. (“Heavy” meaning dense, carrying lots of asphalt and tar, harder to pump and transport; “sour” shorthand for high sulfur and sometimes metal content, thus needing more processing to reduce pollutants.)

(2) Likely unreliable partners: The 26 years of “Chavismo” featured regular large diversions of money from the state oil company PdVSA to regime loyalists and overseas clients, firings of skilled but politically independent-minded staff, and decaying infrastructure. So despite large reserves, the machines and wells needed to bring oil out of the ground and to ports are in bad shape. Venezuela’s real-world production is only about 1% of the world total:  810,000 barrels produced per day, down about 75% from 2.7 million barrels in 2014 and 3.1 million in 1998, and a bit less than 1% of the world’s 102.5 million-barrel daily output. Put bluntly, the administration seems to be relying on the people responsible for this to fix it.

(3) Probably the wrong strategy anyway: Venezuela is too reliant on oil. The WTO’s World Trade Profiles reports that oil exports — even in PdVSA’s current decrepit state — accounting for 75% of Venezuela’s $5 billion in exports. For a regional index, energy makes up 50% of Colombia’s $75 billion in total exports, 39% of Ecuador’s $33 billion, and 28% of Trinidad’s $13 billion.  Ms. Machado’s comments on Venezuela’s experience are an extreme case of a general problem: developing countries solely reliant on resource exports risk concentration of power and wealth, internal corruption, and economic “Dutch disease” in which oil revenue inflates currency values and perversely shrinks the more labor-intensive agriculture and manufacturing sectors.

So a plan based on reviving large-scale Venezuelan energy exports, if it works, will be expensive and slow. Relying on the Chavista officials who crippled it over the past quarter-century to fix it now, rather than experts overseen by democratic politicians, makes such a plan likely to fail. And even if it succeeds to some extent, that might make the logical larger goal — a pluralistic economy and society, a democratic political system, cooperative relationships with South American and Caribbean neighbors — harder to achieve. Juul’s skepticism has a pretty strong foundation.

FURTHER READING

PPI’s four principles for response to tariffs and economic isolationism:

  • Defend the Constitution and oppose rule by decree;
  • Connect tariff policy to growth, work, prices and family budgets, and living standards;
  • Stand by America’s neighbors and allies;
  • Offer a positive alternative.

Venezuela readings, chronological order:

Irish journalist Rory Carroll’s Comandante (2014) examines the Chavez years.

Exiled Venezuelan writer Karina Sainz Borgo’s It Would Be Night in Caracas (2021) has a fictionalized look at Maduro-era life in the capital.

The Journal of Democracy on election thefts in 2013 and 2024.

… and some advice on next steps from exiled academic Juan Miguel Mathews.

Nobel Laureate Maria Corina Machado’s December Nobel Prize lecture.

And PPI’s National Security Director Peter Juul assesses this month’s raid and its likely consequences.

Energy:

PPI’s Energy and Climate Solutions Initiative, featuring Managing Director Neel Brown and Energy and Climate Policy Director Elan Sykes, has energy policy and climate ideas for the United States.

OPEC’s Annual Statistical Bulletins have country-by-country data on reserves, production, trade, refining, operating rigs, etc., from 1999 through 2025.

… or direct to the 2025 edition.

The U.S. Energy Information Administration’s review of the Venezuelan energy sector.

And some jargon explained:

The Energy Information Administration walks you through “light,” “heavy,” “sour,” and “sweet.” 

Why does oil come in “barrels”? The Engineering and Technology History Wiki has the background. TL/DR: Early drillers in 19th-century Pennsylvania did in fact store their oil in 42-gallon wooden barrels. The U.S. Geological Survey and the Bureau of Mines adopted this as a standard measurement in 1882, and despite logic, the metric system, and real-world use of tankers and pipelines rather than “barrels” to move petroleum, it’s been barrels ever since.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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Stop Trump’s Greenland Madness Before it Gets Worse

Madness.

That’s the only way to describe President Trump’s obsession with seizing Greenland by whatever means necessary and no matter the cost. It’s a preoccupation that’s untethered from reality and lacks any rational justification.

Indeed, the shifting rationales offered by the Trump administration for this fixation do not add up and make zero sense.

Take the supposed national security justification for the annexation of Greenland: It’s impossible to say what the United States might gain from such a move because the United States would not gain anything from it. The U.S. military already possesses extensive access to Greenland thanks to the 1951 agreement between Washington and Copenhagen, and the Space Force maintains a base at Pituffik in the territory’s far north that helps monitor for ballistic missile attacks. Moreover, America is already committed to defending Greenland against aggression via Article V of the North Atlantic Treaty. Per that provision — invoked only once in response to the September 11, 2001, terrorist attack on the United States — an armed attack on Greenland, an autonomous and self-governing territory under Danish sovereignty, would be considered an attack on the United States itself. What’s more, the Danish government has already made crystal clear its willingness to discuss even deeper security cooperation with the United States in Greenland.

Put bluntly, there is no national security reason for the United States to annex or otherwise assume direct control over Greenland. Even if they could somehow mount a military expedition to Greenland, China and Russia could not “take over” the island without triggering Article V of the North Atlantic Treaty and provoking an American-led military response. It makes absolutely no sense for the U.S. government to idly contemplate destroying the alliance that obliges the United States to come to Greenland’s defense and tearing up a decades-old security agreement that gives the U.S. military wide-ranging access to the island in order to acquire Greenland itself, supposedly for national security purposes.

The mooted economic rationale for acquiring Greenland makes just as little sense. It’s true that Greenland possesses significant reserves of rare earth elements and other critical minerals, but it’s nowhere near the motherlode the Trump administration claims: indeed, the island’s rare earth reserves rank just below those of the United States itself. If American mining companies aren’t operating in Greenland, it’s due to a lack of interest rather than a lack of access: it’s almost certainly cost-prohibitive to mine these minerals given the ice sheet that covers the island, the remoteness of the deposits, and the near-total absence of necessary mining infrastructure. In short, it will take a long time and cost a lot of money to extract these minerals — and there are much easier prospects elsewhere.

Concern about possible Chinese attempts to corner the market for these resources does not justify an American attempt to seize Greenland itself. Such worries ought to motivate the United States to work more closely with Greenland’s own democratic government, Denmark, NATO, and the European Union to both bar Chinese investment in Greenland’s critical minerals and infrastructure, and more importantly, to invest more themselves in Greenland. (Canada and the United Kingdom hold 23 mining licenses each, the most of any one country.) Again, it makes no sense to destroy these relationships in the pursuit of presidential fantasies of territorial expansion.

So why does Trump appear dead-set on annexing Greenland, strategic and economic costs to the United States — to say nothing of America’s allies and the rest of the world — be damned?

Trump’s own ego and personal vanity appear to be a major factor, with the president telling New York Times reporters that ownership of Greenland is what he feels “is psychologically needed for success.” Annexing Greenland, in other words, will make Trump feel like a big man. He also seems to find Greenland a tempting target because — and I wish I were kidding — it looks “massive” on Mercator map projections that exaggerate the size of landmasses near the poles. 

More ominously, though, Trump’s drive to take Greenland any way he can is a logical outgrowth of his gangster-style approach to the world — and in particular his apparent desire to carve the globe up with his idol Vladimir Putin and Chinese dictator Xi Jinping. Echoing Putin’s nauseating pre-war assertions that Ukraine should “bear with” the Kremlin’s brutal impending invasion, “whether you like it or don’t like it,” Trump has vowed to “do something on Greenland  whether they like it or not.”

Congress has options to stop the madness, or at least make it more onerous for the Trump administration to try and make its twisted fantasies of territorial aggrandizement real.

First, Congress can preemptively deny Trump authority to use force or subversion against Greenland. Such a move would absolutely clear that any orders Trump may give to attack, subvert, or otherwise undermine Danish sovereignty over Greenland and Greenland’s own democratic institutions would be prima facie illegal and subject to refusal by responsible military officers and intelligence officials. It would also send a signal to Denmark and other NATO allies that Congress does not approve of Trump’s ambition to seize Greenland and that it lacks democratic legitimacy in the United States itself.

Congress can also explicitly bar the use of any funds to purchase Greenland or engage in any activities meant to subvert or otherwise undermine Danish sovereignty over the island. Last year, President Trump ordered the intelligence community to increase its spying on Greenland, and the Trump administration has reportedly considered sending Greenland residents cash payments of up to $100,000 if they support secession from Denmark and annexation by the United States — efforts that would not be eligible for funding under a Congressional funding band. Again, this move would be as much about sending signals to NATO allies and giving national security professionals strong grounds to refuse illegal orders as anything else.

Senators and representatives can also travel to Greenland, Denmark, and NATO headquarters in Brussels to show solidarity with these nations and the alliance as a whole. Indeed, a nine-member delegation led by Sen. Chris Coons (D-Del.) and including Sen. Thom Tillis (R-N.C.) has already left for Copenhagen to, in Coons’ words, let the Danish government know “we understand the value of the partnership we have long had with them, and in no way seek to interfere in their internal discussions about the status of Greenland.” Once again, such visits would serve notice that Trump’s proposed aggression against Greenland lacks both support and legitimacy in Congress and the United States. Or as Coons put it, “I just think it’s important for us to be heard as strongly supporting NATO and our alliance.”

This list isn’t exhaustive, but it offers Congress a place to start if we hope to stop this insanity before it proceeds any further.

Proposed Credit Card Rate Cap Risks Cutting Off Millions of Borrowers

WASHINGTON — Today, the Progressive Policy Institute (PPI) issued the following statement in response to the Trump administration’s call for a one-year 10% cap on credit card interest rates:

“After dismissing the affordability crisis as a ‘hoax’ for weeks, President Donald Trump now recognizes that more Americans are facing financial hardship. Unfortunately, the president’s call for a one-year, 10% cap on credit card interest rates would lead to millions of working Americans losing access to traditional sources of credit.

“As outlined in our May report ‘Cutting Credit: How Rate Caps Undermine Access for Working Americans,’ a blunt interest rate ceiling set far below the current market rate will push higher-risk borrowers out of the market and toward more unregulated, predatory options, such as payday loans, subprime mortgages, or high installment loans.

“PPI encourages both the administration and Congress to turn toward smarter ways to reduce the affordability crisis, including enacting sensible permitting reform, reversing the course on the Trump tariffs, and putting an end to the president’s vendetta against renewable energy (in particular, offshore wind power).”

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Manno for The 74: Congress OK’d Pell Grants for Workforce Training. Now, It’s Up to the States

The Pell Grant program for low-income college students was designed for a tidy academic world of 15-week semesters, credit hours and degrees that move at the campus pace. But millions of Americans live in a different place, where the question isn’t “What’s your major?” but “Can I get trained fast enough to start earning before the rent is due?”

Workforce Pell is Washington’s answer. The result of a multi-yearbipartisan effort, the program allows low-income students to use Pell Grants for short-term, job-focused training as well as college.

Now comes the real news and the real test. In December, the U.S. Department of Education’s rulemaking committee reached consensus on proposed regulations for Workforce Pell, which launches July 1. It is up to the states to identify, approve and submit eligible training programs, with the department providing oversight and verification. These programs must demonstrate that they lead to in-demand jobs.

Participating programs will typically last eight to 15 weeks (or as little as 150 hours), catering to adults who can’t pause their lives for a two- or four-year degree. The department’s examples include emergency medical technician and automotive mechanic training, credentials that are directly tied to employment.

This performance element is key, because the U.S. has a long history of short-term programs with glossy marketing and weak payoff. If Workforce Pell becomes an ATM for low-value credentials, it won’t expand opportunity; it will expand regret. So accountability is built into its program eligibility requirements, something unusual in higher education policy.

Read more in The 74.

Canter in The New York Times: How Mississippi Transformed Its Schools From Worst to Best

[…]

How could Mississippi, with its low education spending and high child poverty, pull it off?

It did not do so by relying on some of the most common proposals held up as solutions in education, like reducing class sizes, or dramatically boosting per-student funding.

Rather, the state pushed through a vast list of other changes from the top down, including changing the way reading is taught, in an approach known as the science of reading, but also embracing contentious school accountability policies other states have backed away from.

“Science of reading is really important — it was a key piece of what we did,” said Rachel Canter, the longtime leader of Mississippi First, an education reform group, who now works at the Progressive Policy Institute, a center-left Washington think tank. “But people are missing the forest for the trees if they are only looking at that.”

[…]

Read more in The New York Times

New PPI Report Warns ‘Activist Tax’ is Being Driven by Both Trump and the Climate Left

The Progressive Policy Institute (PPI) today released a new report warning that New Jersey’s climate mandates are driving a policy-induced affordability crisis that functions as an “Activist Tax” on households, raising energy costs, straining the power grid, and threatening public support for emissions reduction. As electricity prices surge and clean energy projects stall, the report finds that politically driven mandates are colliding with economic reality in ways that disproportionately burden working families.

The report, titled “New Jersey: Ambitious Goals Meet Reality,” is the second in a PPI series examining how rigid climate mandates and technology-specific requirements can unintentionally impose higher costs on consumers, what the authors describe as an “Activist Tax,” when affordability and grid reliability are treated as secondary concerns.

“New Jersey has already picked the low-hanging fruit,” said Neel Brown, Managing Director at PPI. “What remains are the hardest and most expensive steps, and when policymakers ignore affordability, those costs become an ‘Activist Tax’ paid by working families. That’s how you lose public support for climate action altogether.”

Authored by Brown and John Kemp, an internationally recognized energy markets expert, the report finds that New Jersey’s strong emissions record reflects structural advantages, not recent policy mandates, meaning today’s high-cost requirements deliver diminishing climate returns while increasing the “Activist Tax” on residents.

Despite this strong baseline, the state’s current energy strategy is increasingly strained by rising costs, grid constraints, and stalled clean energy projects. With energy affordability a top focus for Governor-elect Mikie Sherrill, New Jersey faces a critical opportunity to recalibrate its approach before mounting pressures undermine both climate progress and political support.

Key findings from the report include:

  • Left- and right-wing ideological interventions are imposing an “Activist Tax” on New Jersey, with supply constrained by rigid climate mandates and Trump’s war on wind and renewable energy, driving up electricity prices and household energy bills.
  • Electricity prices in NJ surged nearly 20% in 2025, one of the highest increases in the nation, driven by capacity constraints and growing demand from data centers.
  • New Jersey’s emissions per capita (10 tons) and per economic output (137 tons per $1M GDP) are among the lowest in the country, largely due to urban density and a service-based economy, not new energy technologies.
  • The state’s 2050 climate mandates require an 82% cut in building emissions and a 62% cut in electricity generation emissions, calling for a sweeping transformation in home heating and power generation.
  • More than 90% of New Jersey’s electricity still comes from natural gas and nuclear, with minimal deployment of wind or solar. The planned 11 GW of offshore wind is delayed and uncertain following the Trump administration’s suspension of key federal leases.
  • The convergence of rising demand, shrinking supply, and surging costs is threatening the state’s climate timeline and eroding public support, especially among low- and moderate-income households.

The authors argue that rigid technology mandates, premature plant retirements, and politically motivated interventions have imposed what they call an “Activist Tax,” a policy-driven cost burden that ultimately falls on consumers. When affordability erodes, public support for climate policy erodes with it. The report urges policymakers to pivot toward outcome-based policies, prioritize clean, firm baseload power, and treat affordability as a core metric of climate success.

PPI’s analysis offers a roadmap for recalibrating the state’s climate strategy, emphasizing flexibility, affordability protections, and pragmatic planning to sustain momentum toward decarbonization.

Read and download the report here.

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org