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Why the Car Market Went Crazy

Cato Podcast

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EV Subsidies and Domestic Content Requirements

The federal government is in some ways doing all it can to increase the cost of production for domestic automobiles. The Inflation Reduction Act included subsidies for electric vehicles, which are conditioned on those EVs being made in America and using American steel. So you have kind of a handful of qualifying automobiles that are all vying for these subsidies. And so we're basically doing everything we can on the policy side to goose those prices a little more.

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