Chuck Schumer finally got his wish. After reaching a deal with Joe Manchin on a far smaller version of Build Back Better and calling it the Inflation Reduction Act, Kyrsten Sinema objected to its tax increases. Despite some hope that the Arizona Democrat might force economic reality on her colleagues, Sinema agreed to support it after winning some modest changes—and a $5 billion pork chop for Arizona on drought relief.
Schumer wants to sell this as Democrats’ answer to inflation. However, a Penn Wharton Budget Model analysis shows that this bill will actually increase inflation slightly for the first year, and will have little impact on inflation afterward. Even its supposed deficit reduction impact won’t be felt until several years after its adoption.
Schumer hasn’t fooled anyone except Manchin and Sinema. As a YouGov poll showed, only 12 percent of Americans think this will reduce inflation—and only 21 percent of Democrats believe him. In other words, the Inflation Reduction Act is a fraud -- just a skinnier version of the same old tax-and-spend policies that got us into our current economic mess.