The Supreme Court’s decision to reverse Roe v. Wade was a political gift for Democrats. Until June, all signs pointed to a November slaughter, and while Republicans are expected to take back the House of Representatives, having abortion on the ballot gives Democrats a fighting chance to maintain majority control of the U.S. Senate.
And yet, Democrats seem intent on squandering their abortion bump.
A bill coming before Congress this week will keep inflation and the economy in the headlines up to and beyond the midterms, ensuring Democrats have abortion and only abortion to run on this fall.
The pending “Inflation Reduction Act” is a spending package extending Obamacare subsidies, investing in renewable energy, and cutting $300 billion from the federal deficit, which is projected to top $1 trillion in FY2022.
Deficit reduction is smart, particularly when inflation is at a 40-year high, exceeding 9% in June with expectations of 8.8% monthly inflation rates for at least the next three months, according to MarketWatch.com. The problem is how Democrats are planning to do it.
Rather than cutting spending, the Inflation Reduction Act increases taxes and boosts the IRS’ tax collection efforts to generate $739 in revenue, the majority of which will not go toward the deficit.
- 15% corporate minimum tax: affects corporations making over $1 billion in profit; generates $313 billion in revenue;
- IRS enforcement: $124 billion in recouped write-offs;
- Tax increase passed to Americans: the nonpartisan Joint Committee on Taxation’s analysis found the bill will increase taxes by “$11 billion more on Americans earning below $200,000 per year than on Americans earning between $500,000 and $1 million, in 2023”;
- Carried interest tax loophole: increases tax rate from 20 to 37% on money managers; $14 billion in revenue.
According to the Penn Wharton Budget Model, the bill will actually increase inflation until 2024, and reduce it by 0.25% thereafter. According to Moody’s Analytics, the bill will cut inflation by one third of one percent…by 2031.
“These point estimates, however, are not statistically different than zero, thereby indicating a very low level of confidence that the legislation will have any impact on inflation.”–Penn Wharton Budget Model
August is already expected to be a month of mass layoffs. The tech industry has shed 30,000 jobs so far in 2022. 7-11 just fired 880 people. Amazon, Facebook, Oracle, Vox, and Warner Bros. Discovery have all signaled dark times ahead for workers. Weekly jobless claims hit an 8-month high in July, and while this Friday’s jobs report is expected to show positive growth (estimated at about 250,000 new jobs), July may be the last month of good economic news for a while.
And Democrats don’t seem to care.
For a party struggling to gain traction on literally any issue of concern for voters, there couldn’t be a worse time to sacrifice jobs and economic growth for Chinese solar panels and healthcare subsidies.
The latest Gallup polling ranks inflation and “government/leadership” as the top two issues concerning Americans, at 17% each. The only other issue polling issues polling in double digits was “the economy in general” (12%). Abortion made the list at 8%. Climate didn’t make the list for all voters but garnered 6% among Democrat respondents. “Healthcare/insurance” made the list for 3% of Democrat voters.
Worse (for Democrats), Republicans, including New Mexico gubernatorial candidate Mark Ronchetti, may not take as much damage on the abortion issue as election analysts initially presumed.
Ronchetti is a pro-life Republican, but he has signaled an ability to separate his personal beliefs in favor of a middle-ground supported by the majority of Americans. Polls consistently show that most Americans oppose second- and third-term abortions but want exceptions for cases of rape, incest, and life of the mother.
“Republicans, fearing the same, have hit on a way — exemplified by Ronchetti’s ad this week — to try to take the offense on abortion or, at least, render the issue somewhat less potent. The strategy is to reach for the middle ground while painting Democrats as extremists who support abortion without limit.”–Mark Barabak, The Los Angeles Times, “New Mexico Republican shows GOP’s strategy to neutralize issue — paint Democrats as extreme“
If Republicans can walk that middle ground rather than Democrats’ all-or-nothing approach, inflation and the economy are likely to continue to dominate voter concerns heading into the November midterms.
The media no doubt will hand Democrats the headlines they’re seeking with the passage of their new bill–“Dems Pass Inflation Reduction Act With Zero GOP Support”–but the devil’s in the details. Republicans need to drill home the message that the bill does no such thing, because it doesn’t, not until 2024, and after that only by a quarter to a third of a point.
- “0.25% or 0.33%? Democrats’ Inflation Reduction Act wouldn’t lower prices by all that much, analysts say” — MarketWatch
- “U.S. weekly jobless claims hit 8-month high; labor market still tight” — Reuters
- “Number of US workers — and total hours worked — falls in July” — NYPost
- “The Inflation Reduction Act doesn’t reduce inflation” — Washington Examiner
- “The ‘Inflation Reduction Act’ Won’t Actually Reduce Inflation” — Reason
Categories: Legislative Actions, New Mexico
As we get closer to election day, this non-recession will become much more an obvious recession. We have seen inflation subside somewhat as demand destruction takes over but the real slowdown has just started. “It’s the economy, stupid”.