This is not the first time I've ranted on variations of this topic--I've made tongue-in-cheek reference to the "I Love Mommies and Puppy Dogs Act". Progressive trolls will flame anyone who dares to question its passage in Congress: "What kind of a heinous monster does someone have to be in order to be against Mommies and puppy dogs?" You can point out in vain there's no enumerated power in the Constitution for Congress to make public policy on the behalf of Mommies and puppy dogs. Not to mention you can almost guarantee no troll or legislator supporting it has actually read the bill and knows what policies are in the Act which may have little if anything to do with Mommies or puppy dogs. All the Congressman knows is that he (or she) doesn't want to respond to his next election opponent's attack ad pointing out that he voted against Mommies and puppies.
What sparked this rant? Schumer and Manchin recently repackaged the mega-sized domestic spending initiative "Build Back Better' (which deserves its own rant, but I consider in a different category), in a downsized form called the "Inflation Reduction Act". This is a tax-and-spending package with front-loaded spending of about $433B over the coming decade, principally in "clean" energy expenditures and continued ACA subsidies, and increases taxes through a corporate minimum tax, expected revenue by adding new IRS manpower, and a carried interest loophole. It promises to cut the deficit by $300B over the coming decade.
What supposedly fights inflation? Well, they're hoping to lower prescription prices, at least for seniors in a Medicare program by negotiating prices and capping annual out-of-pocket costs, and ACA subsidies. Presumably consumers will benefit from EV subsidies and/or clean energy investments, say, in solar paneling of homes, etc. And presumably lower deficits help stabilize the dollar..
I'm not going to go into a detailed analysis here, just a few points. First, we need inflation relief sooner than later, and deficit relief is in the later years. Second, even if the deficit reductions are realized, we are seeing projected $1T deficits in coming fiscal years and $30B is literally pennies on the dollar.. Never mind I think the improved IRS collection is a pipe dream, corporate taxes, like other costs, ultimately get passed along to the consumer, ACA subsidies don't apply to most households and don't reform underlying costs, and clean energy subsidies will have little, if any, impact on most energy consumers. If they have an effect, it's more likely to be in later years and certainly won't help inflation in the short term.
What would reduce inflation more authentically? Again, an exhaustive response is beyond the scope of this post, but the types of things I would look for include: reform of the Federal Reserve, including reducing its mandates to currency stability, and rule-based interest rate changes; lowering barriers of entry for foreign goods and regulated prescription drugs, lowered barriers to occupations and business formation, across-the-board spending cuts, means testing for government programs, etc.
Other/classic examples of misleading bill names:
- Violence Against Women Act (1994). First, the police power rests with the states, and violence was already illegal. In fact, it was already trending down before 1994.
- Marketplace Fairness Act. More like the Internet Order Delivery Local Sales Tax Collection Act.
- Patient Protection and Affordable Care Act, i.e., ObamaCare. Ask people how affordable are soaring premiums and deductible.
- PATRIOT Act. Apparently, real "patriots" don't care their own government spies on them without a warrant.
