CBS GOES OUT ON A LIMB: One thing the Inflation Reduction Act may not do: Lower inflation.
The Inflation Reduction Act is aimed at tackling a host of problems, from climate change to catching tax cheats, but there’s one issue it may not solve: reducing inflation.
That’s the conclusion of the Penn Wharton Budget Model, a group of economists and data scientists at University of Pennsylvania who analyze public policies to predict their economic and fiscal impacts. Its analysis, published Friday, comes as inflation remains near a 40-year high, crimping the budgets of consumers and businesses alike.
The Inflation Reduction Act would invest nearly $400 billion in energy security and climate change proposals, aimed at reducing carbon emissions by approximately 40% by 2030. It also would allow Medicare to negotiate with drugmakers on prescription prices, and would limit out-of-pocket drug expenses for seniors to $2,000 annually. The bill also directs $80 billion in funding to the IRS, aimed at helping the underfunded agency hire more auditors and beef up its customer service and technology.
But the impact on inflation “is statistically indistinguishable from zero,” the Penn Wharton Budget Model said on Friday.
As the man promised voters in 2020, “Milton Friedman isn’t running the show anymore.”
Related: About That ‘Inflation Reduction Act…’
Even the House of Stephanopoulos isn’t buying the Biden administration’s spin:
JONATHAN KARL: "Isn't it almost Orwellian? How can you call it the Inflation Reduction Act when the nonpartisan experts say it's not going to bring inflation down?"
KARINE JEAN-PIERRE: "I appreciate the question."
— Benny Johnson 🍊 (@bennyjohnson) August 14, 2022