Democrats’ inflation ‘reduction’ actually won’t reduce inflation, analysis confirms

Democrats’ new spending bill, the “Inflation Reduction Act of 2022,” will have a statistically insignificant impact on inflation, according to an analysis released Friday.

The legislation, a budget reconciliation bill proposed by Democratic Sens. Chuck Schumer of New York and Joe Manchin of West Virginia, is intended to address skyrocketing inflation by subsidizing energy and health care costs for consumers and lowering the budget deficit. However, despite its numerous tax increases, the bill will only cut deficits by $248 billion and fail to have any measurable effect on rampant inflation, according to an analysis by the University of Pennsylvania’s Penn Wharton Budget Model.

“The Act would very slightly increase inflation until 2024 and decrease inflation thereafter,” the analysis found. “These point estimates are statistically indistinguishable from zero, thereby indicating low confidence that the legislation will have any impact on inflation.”

Our country must be energy independent to be the superpower of the world. The Inflation Reduction Act increases our energy security by ensuring fossil fuel resources are not arbitrarily eliminated over the next decade. It will also bring manufacturing & mining back to N. America. pic.twitter.com/L9dtTXTUln

— Senator Joe Manchin (@Sen_JoeManchin) July 29, 2022

The bill shells out $370 billion in subsidies and tax credits to promote green energy and appropriates roughly $80 billion to expand the size and enforcement capacity of the Internal Revenue Service. In addition, the legislation would cap prescription drug prices and mandate a 15% federal minimum tax rate for corporations with market caps over $1 billion.- READ MORE