Manchin and Sinema had a chance to go down in history as heroes. They courageously withstood withering criticism to save the republic from trillions of dollars of inflation-fanning intergenerational theft.
But finally, they fell for the oldest trick in the book—the “dad can I have a pony” swindle, traditionally practiced by clever youngsters who were willing to settle for a puppy in the first place. Exhausted by the mental energy required to resist intraparty pressure and not wanting to be responsible for poor election outcomes, they caved.
Manchin and Sinema supported the Inflation Reduction Act for $740 billion after sinking (again, thank you) the original $3.6 trillion version.
But what they got was possibly the most deceitful bill in the history of bills. The “IRA will reduce the deficit by $300 billion,” claimed huckster-in-chief Joe Biden. “And we’ll do it without raising taxes a penny on those making less than $400,000 per year.”
Are you joking? Let’s start with the IRS, which received an $80 billion spending boost, an amount the Treasury Department reported would result in 87,000 new FTEs, mostly auditors and examiners.
That’s bad news for the middle class. Only 1.8% of American taxpayers earn more than $400,000 yearly. It’s inevitable that the other 98.2%, who make about 75% of the total income, will also receive increased scrutiny.
The only purpose of hiring an army of new auditors would be to increase collections. Anyone familiar with IRS audits knows that even taxpayers who have done no wrong often capitulate to aggressive harassment. The bottom line is that the Congressional Joint Committee on Taxation estimates that 70% to 90% of the money raised from unreported income would likely come from those making less than $200,000 per year.
The bill writers, sensing the problem, added this gem: “Nothing in this section is intended to increase taxes on any taxpayer or small business with a taxable income under $400,000.”
Get it? Nothing here provides actual protection to any lower income taxpayers. Instead, the party of good intentions is attempting to avoid accountability while claiming any unfortunate outcomes won’t be their fault.
The Inflation Reduction Act, it is now well established, will not reduce inflation and won’t reduce the deficit either, according to the bipartisan Joint Committee on Taxation. Instead, all of us will pay for this boondoggle 1) by forking over more money to the IRS (see above) 2) through the effects of the new 15% corporate minimum tax passed on to workers and consumers and 3) through another government spending spree which will (again) be inflationary. Even Bernie Sanders gets it this time.
But the damage doesn’t stop there. As Steve Moore recently noted in the Wall Street Journal, the IRA will transfer $250 billion from Big Pharma to Big Climate.
Bad idea. Pharmaceutical companies spend $100 billion yearly on R&D, bringing us lifesaving and misery-reducing drugs which have, among other benefits, reduced death rates from cancer and heart disease by half in the last 50 years.
The IRA price controls will inhibit innovation with a resulting cost in lost years of life estimated to be 30 times that from COVID, in addition to the increased human suffering and economic losses.
The climate change funds will go mainly to subsidies of wind and solar, which after decades of “startup” funding, produce 7% of America’s total energy. They’re not only unreliable but expensive too. A University of Texas study showed subsidies per megawatt hour of electricity range from 50 cents for coal up to $43 to $320 for solar. Yet we’re going to spend $380 billion more to chase the chimera of avoiding mostly inevitable climate change by vastly reducing our quality of life.
Americans deserve better governments than this. Passing trillion-dollar spending bills for no essential reason has become the new normal.
It’s tempting to feel helpless, but what we can do is vote smarter. For starters, Arizonans should remember this in November: Mark Kelly was a tie-breaking vote on the Inflation Reduction Act. With just 51 votes, it couldn’t have passed without him.
He campaigns as a bipartisan centrist but votes like a socialist. It’s time for us to wise up.
Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.
With the primary election over and the general election drawing near, Senator Mark Kelly (D-AZ) is leaning into his image as an independent candidate.
On Tuesday, Kelly republished an edited version of campaign messaging issued from last month announcing a 50-person bipartisan coalition of constituents. The senator shifted his presentation from an official with bipartisan support to an “independent voice” for Arizonans.
Last week, Kelly aided the passage of President Joe Biden’s controversial Inflation Reduction Act (IRA) without the hesitation initially posed by Senator Kyrsten Sinema (D-AZ). The senator said that the IRA would lower prescription drug costs, implement funding to combat drought and “climate change,” and reduce the deficit. Kelly promised that the IRA wouldn’t result in increased taxes for small businesses and middle-class Arizonans.
Kelly aligned with the Democratic Party on all fronts concerning the IRA, rejecting across the board amendments that would finish the border wall, approve coal leases, increase domestic oil production, protect those making under $400,000 from additional tax audits, limit price controls for treatments on conditions like cancer and Alzheimer’s disease, require oil and gas lease sales in the outer Continental Shelf, provide discounted insulin for low and middle-income Americans, remove $45 million in climate-related expenditures, retain Title 42, strike a tax increase resulting in higher energy prices for those earning under $400,000, hire more Border Patrol agents, reduce drug prices, invest in violent crime prevention, and prohibit tax credits for electric vehicles built with slave labor.
With Kelly’s support of the IRA expansion of the IRS by 87,000 more agents, it’s likely that most Americans making under $200,000 a year will be audited. 2021 IRS data revealed that over half of their audits focused on individuals making less than $75,000 a year.
Kelly’s campaign tone shift follows that of his Republican opponent, Blake Masters. As AZ Free News reported earlier this week, Masters opted to describe himself as “independent” in his latest campaign video, rather than displaying his endorsement from former President Donald Trump or interviews with popular right-leaning shows.
Media coverage of Masters’ shift may have prompted the candidate to backtrack somewhat. At some point over the last week, Masters rendered the video “unlisted”: meaning, the video doesn’t appear anywhere on his profile, and remains accessible only through a direct link, like the one we’ve provided above. However, the video remains on his Twitter page.
“Other” voters total just over 1.4 million, tens of thousands more than the 1.2 million registered Democrats. Registered Republicans total well over 1.4 million.
Throughout his tenure, Kelly has insisted that the issues he represents are neither Democrat or Republican issues. Often, he characterizes his stances as “Arizona priorities.”
Masters predicted in July that Kelly would shift his campaign tone to attract more independents, especially with Biden’s approval ratings at historic lows. The president’s IRA passage offered a slight boost from a historic low of 36 percent to 40 percent — though his inroads with Democratic and Republican approval numbers weren’t reflected among independent voters, who dropped further in their support.
The GOP challenger has been critical of Kelly’s claim of independence throughout his campaign, even praising Sinema for being a better independent.
The Arizona Chamber of Commerce and Industry is hoping the U.S. House of Representatives takes a hard look at H.R. 5376, which was formerly known as the Build Back Better Act until being recently rechristened as the Inflation Reduction Act of 2022.
“Arizona job creators oppose the vast majority of the provisions in this bill,” Chamber CEO Danny Seiden said Sunday after the U.S. Senate passed the legislation on party lines. “This bill will not reduce inflation and it will not make the U.S. economy more competitive. Renaming a massive tax and spending bill the Inflation Reduction Act does not improve it.”
Seiden says Sen. Kyrsten Sinema met with Arizona business stakeholders to hear their concerns and did help blunt some of the more harmful provisions, especially those which impact manufacturing businesses already doubly hit by inflation and supply chain disruptions
He also acknowledged there are a few beneficial elements of H.R. 5376 such as provisions which encourage continued business investment and provide significant drought resiliency funding to promote a water secure future.
But despite some of “positive aspects,” Seiden insists H.R. 5376 leaves much to be desired. Which is why he and other state business leaders are calling on Arizona’s nine Representatives to take a closer look at the bill in advance of an expected Aug. 12 vote.
“With the bill headed to the House, we would encourage the Arizona delegation to consider the legislation’s negative effect on Arizona jobs,” Seiden said, adding that that renaming the unpopular Build Back Better Act does not improve the fact the legislation is a massive tax and spending bill.
The legislation is estimated to raise $740 billion in additional revenue from new taxes as well as more enforcement of existing tax laws. It also authorizes $430 billion in new spending, although a more thorough analysis by the Congressional Budget Office has not been completed.
One thing the CBO already knows, U.S. Senator Bernie Sanders said on the Senate Floor, is that what he labeled the “so-called” Inflation Reduction Act will have “a minimal impact on inflation.”
The CEO of the National Association of Manufacturers also expressed disappointment with H.R. 5376. According to Jay Timmons, the Inflation Reduction Act will stifle manufacturing investment in America, undermining the very businesses which kept America’s economy afloat during the COVID-19 pandemic.
“To be sure, (the bill) was worse before Sen. Sinema worked to protect some areas of manufacturing investment,” Timmons said. “But the final bill is still bad policy and will harm our ability to compete in a global economy.”
Also speaking out against H.R. 5376 is the Pharmaceutical Research and Manufacturers of America, whose members will be directly impacted by Medicare drug price controls included in the legislation.
“They say they’re fighting inflation, but the Biden administration’s own data show that prescription medicines are not fueling inflation,” said PhRMA CEO Stephen Ubl. “And they say the bill won’t harm innovation, but various experts, biotech investors and patient advocates agree that this bill will lead to fewer new cures and treatments for patients battling cancer, Alzheimer’s and other diseases.”
Over the weekend, Arizona’s two Democratic senators, Mark Kelly and Kyrsten Sinema, fell in line with their party and backed the Inflation Reduction Act (IRA). The IRA passed the Senate on Sunday along party lines, 51-50, with Vice President Kamala Harris casting the tie-breaking vote.
The IRA, a repackaged version of President Joe Biden’s Build Back Better (BBB) Act, projected well over $700 billion in revenue. However, some analysts have warned that the IRA will have the opposite desired effect on job creation, inflation and deficit reduction, incomes, tax rates, and drug prices.
The two senators opposed amendments to the IRA that would fund $500 million to finish the border wall, approve coal leases, increase domestic oil production in order to lower gas prices, protect those making under $400,000 from additional tax audits, limit price controls for treatments for conditions like cancer and Alzheimer’s disease, require oil and gas lease sales in the outer Continental Shelf, provide discounted insulin for low and middle-income Americans, remove $45 million in climate-related expenditures, retain Title 42, strike a tax increase resulting in higher energy prices for those earning under $400,000, hire more Border Patrol agents, reduce drug prices, invest in violent crime prevention, and prohibit tax credits for electric vehicles built with slave labor.
The IRA will also expand the Internal Revenue Service (IRS) by up to 87,000 more employees through an $80 billion investment. That will make the IRS bigger than the Pentagon, State Department, FBI, and Border Patrol combined, as noted by Washington Free Beacon. IRS data reveals that over half of all IRS audits in 2021 focused on taxpayers making less than $75,000 a year.
All Democrats, including Kelly and Sinema, rejected an amendment to remove provisions expanding the IRS.
Arizonans gathered on Saturday in Phoenix to protest Sinema and Kelly’s support of the bill. FreedomWorks Grassroots Director and Co-founder of EZAZ.org Merissa Hamilton, who helped organize the protest, criticized Sinema and Kelly for supporting the IRS increase, which she called an “inquisition” comparable to the treatment of ideological opponents under the Obama administration.
“Clearly, your IRS inquisitions are to target us like you did the Obama-Biden administration, and we have had enough,” said Hamilton. “We’re already in the middle of a recession — I know it’s tough for you to say the “r” word, but it’s time for you to take responsibility, represent Arizona, and stop betraying us.”
An amendment to prevent oil sales to China was ruled out of order by Senate chair after Kelly and Sinema joined the majority of Democrats to waive it.
Sinema insisted that the IRA would “help Arizonans build better lives” through lowered prices on goods and services, accessible health care, and water and energy security. Sinema promised that the IRA would cause Arizona’s economy to improve.
As AZ Free News reported last week, Sinema’s original holdout on the IRA concerned its carried tax provision. Democratic leadership agreed to drop that provision in order to earn her vote.
Kelly elaborated further on the rationale for the Arizona senators’ votes. He said that the IRA will lower prescription drug costs, implement funding to effectively combat drought and “climate change,” and reduce the deficit. Kelly promised that the IRA wouldn’t result in increased taxes for small businesses and middle-class Arizonans.
“When I meet with Arizonans and small businesses across our state, the top concern I hear about is rising costs,” said Kelly. “This is going to lower costs for health care, prescription drugs, and energy while creating great-paying jobs in Arizona.”
Notable opposition to the IRA came from Senator Bernie Sanders (I-VT). The senator criticized the IRA for not doing enough to help the working class, and proposed amendments to modify the bill that were roundly rejected, 99-1. However, Sanders ultimately fell in line with the Democratic Party and voted for the bill.
George Takei, of “Star Trek” fame, threatened to remove Senator Kyrsten Sinema (D-AZ) from office if she opposes President Joe Biden’s bill raising corporate taxes.
The legislation in question, the 725-page Inflation Reduction Act (IRA) of 2022, would impose a 15 percent minimum tax on corporations with income of $1 billion or more and closure of a carried interest provision in the tax code. The legislation is a repackaged version of Biden’s Build Back Better (BBB) Act. It gained momentum after earning Senator Joe Manchin’s (D-WV) support last week, who held out previously over concerns that it would exacerbate inflation.
Takei is a New Yorker and prominent LGBTQ+ activist; Sinema’s the Senate’s first bisexual member.
Sinema’s opposition stands in the way of Democrats’ budget reconciliation — the only way Biden can have his bill passed without Republican support.
Costing around $433 billion, the IRA would invest $369 billion into renewable energy and climate change programs, enforce price controls on prescription medication, allow Medicare to negotiate drug prices and caps out-of-pocket cost to $2,000, expand the IRS budget by $124 billion, and extend the Affordable Care Act (ACA) while lowering premiums.
Democratic leadership claimed that the IRA would raise $739 billion in revenues, effectively reducing the deficit by over $300 billion and countering the historic high inflation (9.1 percent) plaguing the nation currently. In the Democrats’ one-page summary of the IRA, they claimed that the IRA wouldn’t result in any new taxes on families making $400,000 or less, and no new taxes on small businesses.
The Tax Foundation estimated that the IRA would eliminate about 30,000 jobs and reduce economic output and after-tax wages in the long run. They identified the 15 percent minimum tax on corporations as the main cause for projected job reduction.
On Tuesday, Sinema spoke with Arizona Chamber of Commerce President and CEO Danny Seiden about the legislation.
Seiden and the Arizona Chamber of Commerce oppose the bill. They insist that the IRA would raise taxes and disincentivize businesses’ growth.
On Wednesday, Axios reported that sources close to Sinema revealed that the senator may support the IRA if it’s expanded to include provisions improving drought and water security in the Southwest. Politico sources close to Sinema put a price tag to that request: $5 billion.
Arizona has been in a long-term drought for nearly 30 years, a status worsened by the recent reclassification of the Colorado River to Tier One drought status. That reduced Arizona’s water allotment, and prompted Governor Doug Ducey to seek out Israeli desalination technology to counter the drought.