A good question for us armchair economists…..and I am sure there is a wealth of opinions out there…..this is just mine.
Let’s begin with the new Inflation Reduction Act before the Congress……
The bill, introduced last week after a long-awaited deal was struck between Senate Majority Leader Chuck Schumer (D–N.Y.) and moderate Sen. Joe Manchin (D–W.Va.), was pitched as a way to lower costs for consumers while also reducing the federal budget deficit and spending billions on environmental initiatives meant to combat climate change.
It didn’t take long for a problem to present itself.
“The impact on inflation is statistically indistinguishable from zero,” concluded the Penn Wharton Budget Model (PWBM), a number-crunching policy center based at the University of Pennsylvania. In fact, if the bill’s passage had any impact on inflation in the short term, it would be to increase it very slightly until 2024, according to the group’s preliminary analysis, released on Friday.
Other parts of the Inflation Reduction Act would do what Manchin and Schumer claim. According to the PWBM report, the bill would reduce future deficits by a cumulative $247 billion over the next decade and would marginally reduce the national debt as a result. It would spend about $370 billion on new environmental and climate initiatives. It would pay for all that by raising taxes and by boosting IRS enforcement, in hopes of chasing down revenue that currently goes unpaid.
But again, the Inflation Reduction Act won’t actually reduce inflation.
Once again the answers to the nation’s economic problems is a bill or action that does little to help.
I have made my thoughts known and the comments were as I expected…..but like I say….they are my opinions not a game plan although my ideas would help.
“Inflation” is the new buzzword of the year. It is the reason for the Federal Reserve’s interest rate hikes designed to increase the costs of some loans. It is the excuse given against renewing the expanded child tax credit program that briefly lifted millions of American families out of poverty. It forms the name of one of the key pieces of legislation that may salvage President Joe Biden’s first term: the Inflation Reduction Act. And, it is the basis of Republican complaints against Democrats heading toward the midterm elections this fall.
With all this concern over inflation, one wonders why so little heed has been paid to another “i” word: inequality.
For decades, government officials, media pundits, mainstream economists, politicians, and others were content to allow and even enable money to flow upward, enriching the already wealthy. They paid little heed to increasing inequality, beyond shrugging their shoulders and lamenting the injustice of it all.
To fiscally conservative politicians, it seems that inflation equates to trouble, but inequality is perfectly tolerable.
We are told daily how tough things are for the corporations…..and yet they find enough cash to buy other companies even football teams when times are tough.
So yes….I agree with the article above.
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