It didn’t take long after Democrats passed their reconciliation bill through the Senate for the left-leaning press to jettison the inflation-related justification, with the Los Angeles Times, New York Times, and Washington Post all referring to it as a bill for climate policy and health care. With inflation over 9 percent and real wages declining, the voters were not crying out for a climate bill, nor are they ever (the environment is usually near the bottom of voters’ priorities in opinion polling), but the hyper-online Left was, and Democrats know their base.
The Congressional Budget Office, the Penn Wharton Budget Model, and even bill supporter Bernie Sanders all agree: The bill won’t have a noticeable impact on inflation at all. Everything in it was proposed by Democrats before inflation became a pressing concern, and the bill serves progressive interests (which explains Sanders’s support).
The biggest chunk of spending is on corporate welfare for green-energy companies. That’s what corporate tax credits mean in the context of climate policy, and the Democrats’ bill has hundreds of billions of dollars’ worth of them. Progressives are breathlessly claiming that the bill will reduce emissions by 40 percent by 2030. What they aren’t saying as loudly is that the 40 percent is measured starting in 2005, so much of the reduction (halfway to 40 percent as of 2020) has occurred already.
ABC News notes that “Democrats are also excited about the bill’s hefty funding initiative — $60 billion overall — for environmental justice projects.” Environmental justice, a campus buzzword not that long ago, is now receiving nearly twice as many taxpayer dollars over the next ten years from this one bill as the entire Department of Justice spent in 2021.
The bill raises corporate taxes through a book minimum tax. Corporations pass much of their tax burden on to consumers, who are already facing higher prices. It also contains a hidden gas-tax increase by reinstating the Superfund tax that lapsed in the 1990s.
The surge in IRS funding will roughly double the tax-collection agency’s workforce, for the purpose of harassing more Americans. The agency isn’t even sure how it will spend another $80 billion over the next ten years, but that didn’t stop Democrats. From here on out, Democrats should expect every tax audit to be blamed on them. They’re the party of doubling the IRS now.
Even the claim of deficit reduction doesn’t hold up on closer inspection. It uses a budget gimmick, similar to those from the Build Back Better debate, by imposing an arbitrary deadline on Obamacare provisions that Democrats fully intend to be permanent. And the bill would actually increase the deficit in the next four years, only to supposedly reduce it later. Washington has a funny habit of not doing the hard part later when the easy part comes first.
These are the exact kind of budget games that Joe Manchin said he was against during the Build Back Better fiasco. Now we know it was all talk. But Republicans should never have been counting on a Democrat to vote against more taxes and spending in the first place.
Democrats were only able to pass this bill because they have exactly 50 senators and the vice presidency. If it weren’t for Republicans losing the Senate runoff elections in Georgia, Mitch McConnell would be majority leader right now, and the Grim Reaper would have assured that no bill passed. But Donald Trump had to make himself the center of attention, with his baseless claims that Georgia’s elections were rigged, and hundreds of thousands of Republican voters believed him and didn’t turn out for the runoffs, flipping the seats to Democrats.
It’s now up to Republicans to make the case to voters that Democrats aren’t addressing the actual problems with the economy. President Biden’s approval ratings are still low, and inflation is still high. Now is the time for the supply-side agenda of lower taxes, deregulation, and increased energy production that Republicans should all support. By focusing on the issues that actually matter to voters, Republicans can rename Democrats’ tone-deaf bill yet again: the Democratic Caucus Reduction Act.