Tag Archive for: inflation reduction act

Inflation Reduction? Dems’ Climate Spending Spree Could Cost $1.2 Trillion, Analysts Say

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Democrats’ Inflation Reduction Act (IRA) could cost roughly $1.2 trillion in green energy subsidies, more than four times an initial government forecast of outlays, Bloomberg reported Thursday, citing analysts from Goldman Sachs.

The Congressional Budget Office (CBO) initially forecast that the law, a cornerstone of President Joe Biden’s efforts to decarbonize the U.S. economy, would cost the government $370 billion to boost investments in green technology, according to Bloomberg. Goldman Sachs’ findings mirror those of analytics firm Benchmark Mineral Intelligence, which reported in February that the estimated cost of battery manufacturing tax breaks would be roughly $136 billion over the next 10 years, more than four times the $30.6 billion estimated by the CBO.

“Early analysis of the IRA relied on unrealistic expectations to keep cost estimates down,” Heritage Foundation economist E.J. Antoni told the Daily Caller News Foundation in a statement. “As time has progressed and those rosy forecasts are pushed outside the realm of possibility, the real cost is becoming increasingly clear.”

Goldman analysts estimate that private companies, spurred by government benefits, will invest an additional $3 trillion, Bloomberg reported. Biden specifically called out “every single” Republican for siding with “special interests” over the American people in opposing the bill, in remarks made after he signed it into law in August.

The IRA offers a variety of tax credits and subsidies to wind, solar and battery production and encourages U.S.-based mining by linking battery subsidies to a requirement that at least 40% of all minerals are mined domestically or from certain allies. The bill also expanded a federal  loan program to support research and development of advanced batteries to be used in vehicles.

The massive climate bill would have an effect on inflation that was “statistically indistinguishable from zero,” according to a preliminary estimate made by the University of Pennsylvania Penn Wharton Budget Model made in July. President Joe Biden last August touted a letter signed by 120 economists, including some Nobel prize winners, which alleged that the bill would put “downward pressure” on inflation, based on a CBO estimate that the bill would cut government spending by $300 billion over 10 years, the Associated Press reported contemporaneously.

Then-House Minority Leader Kevin McCarthy argued at the time that the bill would spend “half-a-trillion of your money,” building on “trillions in wasteful spending that caused runaway inflation” in an August debate on the bill.

“Passing this bill today means more expensive bills for Americans tomorrow. And anyone who says otherwise isn’t telling the truth,” McCarthy said. “Your pocketbook is their plan to fund more inflationary spending.”

The White House did not immediately respond to a DCNF request for comment.

AUTHOR

JOHN HUGH DEMASTRI

Contributor.

RELATED ARTICLE: Staggering Price Tag, Logistical Hurdles Make Biden’s Climate Agenda A ‘Fool’s Errand,’ Report Says

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New Poll Delivers Some Alarming News For Democrats

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Voters overwhelmingly trust Republicans to manage the economy, a new poll ahead of this year’s midterm elections suggests, while

Roughly 52% of voters said that they trust Republicans to manage the economy, compared to 38% for Democrats, while only 1% of respondents said they agreed with the proposals of both parties to manage it, according to a poll conducted by the Times and Siena College, which measured the relative strength of both parties in advance of the election scheduled on Nov. 8. The economy has been the most important issue to voters heading into the polls; in a July edition of the same NYT/Siena poll, 20% called it the “most important problem facing the country today,” while roughly 76% said that it would be “extremely important” to them as they vote.

Democrats have sought to focus their campaign narrative on social issues such as abortion in the wake of Roe v. Wade’s overturning by the Supreme Court, as well as gun regulations following mass shootings across the country over the summer.

However, efforts to place social issues at the forefront of voters’ minds do not appear to be working. The NYT/Sienna poll revealed that voters consider economic issues more important to their voting decision than social issues, by an 18-point margin.

The polls come at a time of bad economic news for the Biden administration before November’s election. The White House recently released an economic blueprint listing its various accomplishments, with President Joe Biden holding a series of events to highlight the “Inflation Reduction Act,” a massive spending package that his administration had proposed to the Democratic-controlled Congress.

The Consumer Price Index, an aggregate measure of inflation, increased by 0.1% from July to August, though tempered by reductions in the price of gasoline even as food costs rose, according to the Bureau of Labor and Statistics. The news poorly affected stock markets over the week, with the Dow Jones Industrial Average falling by 1,600 points beginning Monday, closing for the week at 30,841.05 points.

There was some good news for Democrats, who currently control Congress and the White House. Between July and September, the number of voters who believe the country is “heading on the right track” increased modestly, from 27% to 50% for Democrats, and 9% to 27% for independents; however, 53% expressed disapproval of Biden’s performance in office.

The poll surveyed 1,399 registered voters nationwide from Sept. 6 to 14, 2022, its margin of sampling error was +/- 3.6 percentage points.

The White House and Democratic Congressional Campaign Committee had not responded to a request for comment from the Daily Caller News Foundation.

AUTHOR

ARJUN SINGH

Contributor.

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EDITORS NOTE: This Daily Caller column is republished with permission. ©All rights reserved. Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.

Key Inflation Indicator Remains Sky-High In Another Worrying Sign For Businesses

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The prices faced by producers rose by 8.7% year-on-year in August as inflation continues to challenge businesses, according to the Bureau of Labor Statistics (BLS).

While down from the near-record highs of 11.3% in June, the current price increases were over 4 times the typical rates — between 1 and 3% annually — seen in 2019 and 2020, according to data from the Bureau of Labor Statistics’ Producer Price Index (PPI), which measures the prices suppliers charge businesses and other customers. These elevated rates mirror Tuesday’s Consumer Price Index (CPI), which pegged inflation at 8.3%, according to the BLS.

A significant component of the decrease was accounted for by a 5.2% decline in energy costs, according to the BLS. Mirroring July’s results, the index for foods and all goods less food and energy rose by 0.1% and 0.2%, respectively.

The index for all products other than foods, energy and trade services rose by 5.6% year-over-year,  less than the 5.8% posted in July, according to the BLS. The price for unprocessed goods was still incredibly elevated, at 36.1%, more than July’s value of 30.4%, as a spike in the price of natural gas kept prices up.

The Biden administration has been taking a victory lap on economic conditions, with Treasury Secretary Janet Yellen claiming the economy had undergone one of the fastest recoveries in modern history. President Joe Biden claimed that the passage of the Inflation Reduction Act had helped to combat inflation “at the kitchen table,” in a Tuesday speech at the White House.

Simultaneously, the BLS’ monthly CPI report placed inflation at 8.3%, and found that food prices had increased 13.5% annually. Rent and electricity were also up, 6.7% and 15.8% respectively.

Increased rent prices have put pressure on families in particular, with the average cost of a single family rental home up about 13.4% this year, according to CNBC. At a median cost of $2,495 per month, families who might otherwise save to purchase a house are being priced out of home ownership, CNBC reported.

Gas prices also remained incredibly elevated, despite having fallen 12.2% month-on-month, and were still up 25.6% compared to the same time last year, the BLS reported.

AUTHOR

JOHN HUGH DEMASTRI

Contributor.

RELATED ARTICLE: Food Prices Hit 40-Year High, Keep Breaking Records Every Month

EDITORS NOTE: This Daily Caller column is republished with permission. ©All rights reserved. Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.