CNN’s White House correspondent John Harwood said Tuesday that the name of the Inflation Reduction Act was just a marketing tactic to get West Virginia Democratic Sen. Joe Manchin to get on board.
President Joe Biden is set to sign the $750 billion so-called Inflation Reduction Act on Tuesday afternoon, marking a legislative victory for Biden and the Democrats. The legislation is not expected to reduce inflation, which has hit decade-highs.
CNN’s Brianna Keilar said the passing was a big win for Democrats though “questions remain about whether it will live up to its name.”
CNN then played a montage of Democrats struggling to explain how exactly the bill would help combat inflation.
“That is the trouble, it’s not that this isn’t a big bill, John,” Keilar said. “It’s not that it doesn’t accomplish things that have not been accomplished before, haven’t been addressed in decades. It’s that it doesn’t live up to its name.”
“No, it doesn’t live up to its name, let’s be real,” Harwood said. “They call it the Inflation Reduction Act as a marketing device in part to lock down the vote of Joe Manchin. To reassure Joe Manchin that they were focused on his issue.”
Harwood then acknowledged the bill will “have a negligible effect on inflation,” and if it does it will only have a “tiny” effect.
“What it’s about is climate, it’s about health policy, extending Obamacare subsidies, lowering prescription drug costs by letting Medicare negotiate and taxing big corporations. That’s the core element of the plan,” Harwood continued. “If it does anything appreciable to reduce inflation, that’s gravy.”
The legislation will only cut deficits by $248 billion and will fail to have any measurable effect on rampant inflation, a recent analysis by the University of Pennsylvania’s Penn Wharton Budget Model found. (RELATED: ‘Pure, Outright Lie’: Manchin, Harris Faulkner Spar Over Inflation Bill)
“The Act would very slightly increase inflation until 2024 and decrease inflation thereafter,” the analysis found. “These point estimates are statistically indistinguishable from zero, thereby indicating low confidence that the legislation will have any impact on inflation.”
The bill spends $370 billion in subsidies and tax credits to promote green energy and about $80 billion to expand the size of the Internal Revenue Service. The legislation also mandates a 15% federal minimum tax rate for corporations with market caps over $1 billion.
Manchin previously said he would not support large spending bills during periods of high inflation but later changed his mind, saying the package would fight inflation by lowering prescription costs and fighting climate change.
“I support the Inflation Reduction Act of 2022 because it provides a responsible path forward that is laser-focused on solving our nation’s major economic, energy and climate problems,” Manchin said.