A letter sent to the House and Senate leadership by 230 economists argues that the Law on the reduction of infrastructures it should contribute to rising inflation and burden the US economy, contrary to claims by President Biden and the Democrats.
Economists wrote in the letter first obtained by Fox News Digital that the US economy is at a “dangerous crossroads” and the improperly named “Inflation Reduction Act of 2022” would do no such thing and instead perpetuate same fiscal policy mistakes that have contributed to precipitate the current worrying economic climate “.
Senator Joe Manchin, DW.Va., announced last week that it has reached an agreement with Senate Majority Leader Chuck Schumer, DN.Y., on the $ 739 billion reconciliation package after more than a year of negotiations between Democrats.
Economic experts point to $ 433 billion of proposed public spending, which they believe “would create immediate inflationary pressures by increasing demand, while supply-side tax hikes would limit supply by discouraging investment and draining the private sector of resources. much needed. “
They also write that “of particular concern” is the minimum corporate tax which they believe will reduce efforts to restore supply chains to function.
Additionally, the bill’s prescription drug provisions “impose price controls that threaten healthcare innovation, creating a toll on human health that would add to the financial problems Americans are already experiencing.”
Some of the notable signatories include Nobel laureate Vernon Smith, former chairman of the Council of Economic Advisers Kevin Hassett, former director of the Office of Management and Budget Jim Miller, and Robert Heller, former chairman of the Federal Reserve Board 1986-1989.
Additionally, professors from the University of Chicago, Princeton University, Duke University, the University of Virginia, Columbia University, and the University of Notre Dame, among others, were listed in the August 3 letter.
Experts conclude that while they agree with an “urgent” need to tackle inflation, the Manchin bill is a “misleading label” applied to legislation that would have the “opposite effect”.
The letter was sent to Schumer, Senate Minority Leader Mitch McConnell, R-Ky., House Speaker Nancy Pelosi, D-Calif. and House Minority Leader Kevin McCarthy, R-Calif.
THE WHITE HOUSE LANDS THE REPUBLICS TO KEEP “OBSTRUCTING” THE PASSAGE OF THE “ANTI-INFLATION PLAN” worth 739 billion dollars
Schumer touted the Inflation Reduction Act as an immediate solution to inflation, which hit a new 40-year high last month.
“The law on reducing inflation will lower inflation, lower the costs of prescription drugs, close the loopholes long exploited by large companies that pay no or little taxes,” Schumer said in the Senate on Thursday.
Additionally, Biden urged Congress to pass the bill during a virtual panel discussion on Thursday. “My message to Congress is this: listen to the American people,” she said.
“This is the strongest bill you can pass to lower inflation, continue cutting deficits, lower health care costs, tackle a climate crisis and promote American energy security and reduce the burdens faced by families in the class. working class and middle class, “Biden continued.
However, Republicans are less enthusiastic about the over $ 700 billion spending and tax package.
McCarthy told Fox News Wednesday that “Democrats have no plans to solve all the problems they have created” and Manchin’s bill is not the solution.
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In the Senate, McConnell said this week that most of his colleagues were “a little shocked” by Manchin’s reversal of previous positions. He went on to tell Fox News that the bill raises taxes and “calling it a bill to reduce inflation is pretty ridiculous.”
“The Democrats are catastrophically out of touch with what American families really care about. Their approval ratings prove it. And their reckless spending and taxation proves it too,” McConnell said in a statement this week.
The Senate will meet on Saturday to vote on a procedural motion to push the bill forward. It is still unclear whether Senator Kyrsten Sinema, D-Ariz., Will support the legislation and his vote is required for final approval of the bill under reconciliation rules that would allow majority approval.
The Democrats previously touted a letter from 126 economists in support of the Manchin bill.