Will the Inflation Reduction Act Actually Curb Inflation?


The estimated effect of the Senate’s climate and tax bill on inflation was among the many points Democrats defended on Saturday night and into Sunday morning.

Some economic analyses, including from the Congressional Budget Office, found that the legislation would have little to no impact on inflation this year.

Senator Richard Blumenthal, Democrat of Connecticut, said on CNN’s “State of the Union” on Sunday that prescription drug costs would fall after Medicare negotiations and energy costs would be reduced from credits and rebates.

“We’re going to see costs of gasoline continue to drop, costs of necessities to decline,” Mr. Blumenthal said. “And I think Americans will see historic results.”

Senator Lindsey Graham, Republican of South Carolina, also appeared on “State of the Union” on Sunday. He said that the bill could discourage companies from investing in equipment and factories, and that the tax on imported barrels of oil could raise gas prices for consumers.

Senator Chris Coons, Democrat of Delaware, said on “This Week” on ABC that Americans might not feel the bill’s cost-saving effects this year or next. But “the Treasury secretaries that have served in both Republican and Democratic administrations support this bill,” he added.

On “Fox News Sunday,” Senator Benjamin L. Cardin, Democrat of Maryland, also said the bill would help lower inflation. The bill would reduce the deficit through its cost-saving measures, he said.



Source: https://www.nytimes.com/2022/08/07/us/politics/inflation-reduction-act-democrats.html