AMAC Exclusive – By Seamus Brennan
Based on the testimony of left-wing media pundits and Democratic politicians in Washington, one might be inclined to believe that the so-called “Inflation Reduction Act”—passed by the Senate on August 7 to ostensibly tackle inflation, combat climate change, and lower drug prices—will serve as a political lifeboat for Democrats less than three months out from the midterms.
“It’s going to immediately help,” President Joe Biden insisted when asked whether the bill would boost his party’s political fortunes. And his allies in the mainstream media did not hesitate to agree. CNN claimed the legislation is a “big win” that could “change America” and “reshape [Biden’s] political fortunes” for the better. The New York Times suggested that Biden, following the bill’s passage in the Senate, “is on a roll that any president would relish.” CBS News hailed the legislation as “a crucial achievement for President Biden and his party.” And The New Republic called it “a big effing deal” that “puts the Democratic party on a promising new path.”
The reality is the exact opposite. The bill is likely to accelerate the problems it purports to address and worsen an economy already plagued by recession and 40-year-high inflation. Though the media has by and large failed to acknowledge it, the legislation is brimming with exorbitantly unpopular measures that will amplify inflation, increase the federal budget deficit, and harm American families. If so, it could end up being the greatest pyrrhic policy victory since Obamacare cost Democrats the House, the Senate, and the White House in 2010, 2014, and 2016.
Perhaps the greatest risk for Democrats is that the bill will turbocharge inflation—the number one malady on voters’ minds. The Penn Wharton Budget Model found that the legislation will not reduce inflation in the slightest and will in fact “increase inflation until 2024.” Furthermore, the bill will, according to the National Taxpayers Union Foundation, increase the national debt and add $285 billion to the deficit within the next 10 years—thus further aggravating inflationary concerns even as Democrats insist it will solve them.
But this is just the beginning of the political perils the bill poses for Democrats. When President Biden signs the bill into law, as he is expected to do shortly after the House votes on the measure later this week, he will be breaking one of his central campaign promises not to raise taxes on Americans earning less than $400,000. Under the IRA, Americans making less than $200,000 annually will see their tax burden skyrocket by $16.7 billion in 2023 alone—and according to the nonpartisan Joint Committee on Taxation, Americans earning less than $400,000 could fully bear two-thirds of the legislation’s tax burden.
The bill also designates a whopping $80 billion for one of Washington’s most unpopular federal agencies: the IRS. Under this legislation, Democrats have voted to hire 87,000 new agents (more than doubling the agency’s size)—a move that even Barack Obama’s IRS Commissioner characterized as wildly unnecessary.
And that’s not all. At a time when voters are concerned about historically high gas prices, the bill contains $386 billion in green energy subsidies that will, in the words of the Wall Street Journal Editorial Board, “make the electric grid less reliable and energy more expensive.” Just as concerningly, the legislation includes a 15 percent corporate minimum tax that will reduce the output of the United States economy by more than $68 billion and result in 220,000 lost jobs. As the National Association of Manufacturers aptly summarized, the IRA’s effect on the American economy will be “swift and devastating.”
Why, then, are Democrats and left-wing media activists praising the legislation as a gigantic victory for the Biden White House?
The answer, of course, is that they are trying to create a narrative that Joe Biden and the Democrats are turning their party’s political fortunes around. But whether that narrative has any grounding in reality—or is just media spin—has yet to be seen.
With the midterm elections just months away, however, it is difficult to imagine a more self-defeating political strategy than insisting that more taxes, more inflation, 87,000 new IRS agents, and doubling down on the Green New Deal are what the situation requires.
Once again, it appears Democrats been caught in the trap of believing that the desires of their far-left base represent the views of the country at large. Though Democrats may be oblivious to it now, if Republicans do their jobs, the “Inflation Reduction Act” will not be a “win” for them at all.
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