Earlier this week, President Biden signed the so-called Inflation Reduction Act into law. If a piece of legislation could fill a cup on cynicism, this one would overflow.
Despite its promising name, this legislation is just another example of Washington false advertising. No matter what words President Biden and Democrats in Washington use, the Inflation Reduction Act won’t deliver as promised, and they know it.
For too long, Americans have been suffering under Biden’s cruel economy. Prices for food, gasoline and housing – to name a few – have risen to levels not seen in decades. And most of these increases are a direct result of this administration’s failed policies, such as limiting the supply of abundant American energy, imposing costly new permitting requirements for building infrastructure, failing to deliver supply-side tax incentives, and massive new government spending.
And while the administration tries to paper over their rookie mistakes with misleading bill titles and rhetoric, the nonpartisan Congressional Budget Office (CBO), Penn Wharton economic forecasters, over 300 economists, and even Bernie Sanders agree – this legislation will not extinguish the fires of inflation anytime soon. It’s like using a squirt gun on a blazing inferno, and in fact may actually make matters worse.
If too much spending caused the problem in the first place, this bill fails to reverse that trend in the short or medium term. CBO estimates that the legislation increases government spending and debt by $54 billion in the first five years. That’s right. This bill spends MORE – not less – over the next five years!
And while the legislation “technically” reduces the deficit over a decade using budget gimmicks, 80 percent of the deficit reduction does not occur until after 2029. Will that happen nearly a decade from now given Washington’s addiction to spending? You’d have better odds winning the lottery.
But that’s not the end of the ruse either. Consider the quarter of a trillion in spending on clean energy tax credits in this legislation. No doubt we need to invest in a clean energy future, but once again, the Democrats have taken things to the extreme. They are less interested in common sense solutions. Instead, they always aim at rewarding their political allies and their clean energy initiatives are no exception. Instead of working with Republicans on bipartisan answers, like incentivizing carbon capture technology or neutral tax credits, their ideas insist on expensive giveaways to unions for clean energy projects. The mandate requires projects to hire workers at often inflated wages, further fueling inflation.
The bait and switch continues with the Democrats’ false prescription drug promises. The centerpiece of their policy authorizes Medicare to “negotiate” with drug manufactures to lower prices. The problem is that this is no negotiation at all – it’s the government taking innovation and new cures hostage in order to impose socialist price controls on an entire industry. If you read the fine print, these price controls don’t even take effect until much later this decade – 2026 for Medicare Part D drugs and 2028 for Part B drugs. Seniors looking for immediate relief from this policy will see none for the next six to eight years.
This legislation also mandates that prices for certain drugs can’t rise faster than inflation. Here again, the well of disappointment will run deep. Instead of reducing costs, nonpartisan economists have confirmed that manufacturers will set much higher launch prices due to these new inflation caps – meaning costs to patients will go up, not down, in the short term as a result of this legislation. Furthermore, in today’s high-inflation environment, the new government caps may also lead to higher-than-anticipated increases in the years ahead.
And here’s the final punch to the gut for patients. Many experts agree that these new federal price controls will dramatically decrease the amount of private investment into research and development for new cures and treatments. The University of Chicago estimates 342 lost cures as a result of this bill. Slowing the pace of discovery and hope for new therapies for deadly diseases like cancer or Alzheimer’s may be the cruelest ruse of all.
Nice sounding names neither pay the bills nor reduce inflation. The much-hyped Inflation Reduction Act will throw another log on the fire of cynicism already burning. It will convince Americans – once again – that Congress is better at saying one thing and doing another.
Vern Buchanan represents Florida’s 16th District in the House of Representatives and is the co-chairman of the bipartisan Florida delegation. Buchanan is second in seniority on the Ways and Means Committee, where he serves as the lead Republican of the Health Subcommittee.
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