Senate Majority Leader Chuck Schumer and Senator Joe Manchin reportedly announced a surprise deal on July 27 that resuscitates Democrats’ big government spending ambitions on health care and energy programs. The $369 billion “Inflation Reduction Act” would force taxpayers to fund a wide array of prescription drug, health insurance, electric vehicles, solar panels, and other such items.
CEI policy experts denounced the bad-for-America deal – except for one glimmer of hope on environmental permitting reform.
Ben Lieberman, CEI senior fellow
“At a time when Americans are struggling with high energy prices, the Senate gives us an energy bill that does nothing to bring these prices down. In fact, the bill mostly subsidizes alternative energy sources that are too costly to compete otherwise, which means that the increases in our electric bills will likely continue. Senators didn’t even get the message that people don’t like spending $80 to fill their gas tanks, as there are provisions in the bill that would add to the upward pressure on future gasoline prices.”
Mario Loyola, CEI senior fellow
“Congratulate Senators Manchin and Schumer for even discussing permitting reform. For too long, a suffocating straitjacket of federal red tape has prevented American communities from getting the modern infrastructure they need and deserve. That is the main reason why energy prices are so high, and it is also the main obstacle to President Biden’s own ‘clean energy’ goals. Unfortunately, Congress has devoted so little discussion to the critical problem of federal red tape, and the special interests here are so entrenched, that it is inconceivable that anything major could change in the few legislative days left between now and September 30. Senator Manchin should insist that permitting reform be done before Congress appropriates another dollar for infrastructure that could take decades to get permits under the current system.”
Ryan Young, CEI senior fellow
“The Inflation Reduction Act (IRA) is misnamed. Tax increases could reduce inflation to the extent they reduce the amount of money in circulation. But spending cuts are a more effective way to do the same thing, because they don’t reduce investment or real output.
In reality, the IRA’s spending increases on politically trendy items will likely more than cancel out any inflation relief from its tax increases. On net, the IRA would likely increase inflation.
“Giving a bad bill a new name doesn’t make it any better. This incarnation of Build Back Better deserves the same fate as its predecessor. Congress should leave inflation-fighting to the Federal Reserve, which unlike Congress, has direct control over monetary policy.”
CEI Senior Fellow and health policy expert Joel Zinberg, in a new co-authored report, wrote about the damage that the health care provisions in the reconciliation bill would do:
“The reconciliation bill would harm patients and taxpayers. The drug price controls would decrease the number of innovative drugs developed, thereby diminishing Americans’ quality and length of life. The insurance subsidies would expand federal spending without enacting any meaningful reform to a broken system. Critically, both proposals would incite inflationary pressure when inflation is already at a 40-year high.”