Rippy column: Political jiujitsu — the Inflation Reduction Act
On Friday, Aug. 12, Democrats in Congress passed the Inflation Reduction Act by a margin of 220 to 207 with no Republicans supporting the vote. Why is it that not one Republican voted for this bill? To answer that question, it might be helpful to first define inflation.
Inflation, according to Forbes, is when prices rise across broad sectors of the economy, decreasing the purchasing power of your money. In Garfield County in 2022, you can see it for yourself. It costs you more to fuel up at the pump, purchase food for your family at City Market, and eat out at your favorite local restaurant. In fact, if you’re paying attention, everything from cars to construction materials costs more these days. Unless you have a generous employer, your paycheck is buying you less every month.
So why would Republicans vote no on a bill called the Inflation Reduction Act? Because, while the deceptively worded bill is a brilliant feat of marketing jiujitsu, it does not actually reduce inflation.
The bill touts it will raise $737 billion to pay down the country’s deficit. Revenues come from an increase in corporate taxes, drug pricing reform for government Medicare programs and the hiring of a cadre of new IRS agents for tax enforcement and audits. Out of these funds raised, Democrats will spend $437 billion largely on climate change activism and extensions to Obamacare subsidies. The result, according to left-leaning politicians, will be a net deficit reduction of $300 billion by 2031.
While Democrats in Congress are cheering their partisan victory to rally the support of Americans across the country, the University of Pennsylvania Wharton School of Business and Public Policy has analyzed the numbers. According to their report, “The impact [of the Inflation Reduction Act] on inflation is statistically indistinguishable from zero.” Zero.
The report goes on to say the act “would very slightly increase inflation until 2024 and decrease inflation thereafter,” but at such an insignificant rate that you won’t notice it at all, especially in the cost of day-to-day expenses.
The bill does allow Medicare to negotiate drug prescription prices. That’s great for those who qualify; for everyone else, expect the price of medicine to continue to skyrocket. Obamacare subsidies were supposed to sunset in 2025; however, with the passing of the Inflation Reduction Act, they will likely become permanent according to the Wharton study, meaning taxpayers will continue to subsidize health care going forward. While taxing the richest corporations like Amazon is appealing to many Americans, these mega businesses will simply pass their increased costs to you.
Like Democrats, Republicans support clean, green energy, but not the vague slush funds tagged for climate change initiatives with little or no accountability as advocated for in this bill.
Finally, the Inflation Reduction Act includes hiring 87,000 new IRS tax agents to compel compliance. Hopefully, it won’t be you who gets audited, but with those workforce numbers, odds are good it will be.
For these reasons, Congressional Republicans did not vote for a dubious bill called the Inflation Reduction Act. Now that Democrats have passed it, what can you do? You don’t have to be a Wharton School economist to understand your buck is buying less.
As midterms draw closer, do a little political jiujitsu of your own. See through the gimmick of a slickly titled bill. Become informed, ask questions, demand accountability and vote accordingly. Learn more at GarfieldCountyRepublicans.com.
Gregg Rippy of Glenwood Springs chairs the Garfield County Republicans and is a former state representative for House District 57.
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