An analysis from the Tax Foundation determined that the so-called Inflation Reduction Act could result in 30,000 jobs disappearing.
The conservative organization discovered that the legislation, which is expected to be narrowly passed in the Senate this weekend, would result in significant “full-time equivalent” job losses, as well as a 0.1 percent decrease in GDP and 0.1 percent decrease in wages, The Washington Examiner reported on August 2.
On jobs specifically, the foundation said that the 15 percent minimum corporate tax would cost roughly 23,000 jobs and “carried interest” would gut another estimated 5,000.
Companies may be responsible for paying higher taxes. They might have to fire employees to make it affordable, or to lower their wages. However, Democrats don’t want to acknowledge the trickle down effect.
When referring to the supposed intent of the bill, which is to lower inflation, it’s not clear what it actually does.
From the foundation:
Lastly, to the extent the durability of the bill’s provisions are in doubt–that is, due to the lack of bipartisan support–it may have little impact on expectations about the fiscal outlook and therefore inflation. The long-term impact of inflation on the economy is uncertain, but it’s likely to be close to zero.
As RedState reported, it’s true that the July jobs report surpassed expectations by adding on 528,000 jobs and touts a 3.5 percent unemployment rate, but the hype around the report misses the point. Inflation is what’s most hurting Americans, according to the Consumer Price Index. The June report shows that the annual inflation rate was 9.1 percent. This is clear evidence of how Americans work, but the prices continue to do damage.
According the Federal Reserve Economic Data, Americans don’t have nearly as much disposable income. Jay Cost, an American Enterprise Institute Fellow, posted this chart on Twitter. It shows that there was a substantial spike in stimulus payments, but the extra money quickly ran out.
Wow, this is amazing. This is amazing. pic.twitter.com/j3BlKvOKfe
— Jay Cost (@JayCostTWS) August 6, 2022
One thing is certain: The Inflation Reduction Act doesn’t live up to what it claims, and it appears more likely that it will cause more damage than good. It is clear that high levels of government spending are the primary cause of this inflation problem. This means more money will not solve the problem.
