‘The American People Won’: Biden Celebrates ‘Inflation Reduction Act’ as Market Plummets over August Inflation News
President Joe Biden celebrated the passage of the “Inflation Reduction Act” by hosting an event at the White House Tuesday, the same day the Bureau of Labor Statistics released a report showing inflation had continued to rise in August, causing markets to plummet.
“This bill cut costs for families. Helped reduce inflation at the kitchen table, because that’s what [people] look at — how much of their monthly bills they have to pay out for their necessities,” Biden said in a speech delivered outside the White House, thanking West Virginia Senator Joe Manchin for voting for the bill.
“This bill alone is going to lower the deficit by $300 billion over the next decades” by lowering the cost of prescription drugs subsidized by the government, he added, saying the “American people won.”
The Bureau of Labor Statistics report, released Tuesday, showed that the Consumer Price Index (CPI), a key measure of inflation, increased by 8.3 percent in August when compared to the same month last year and increased 0.1 percent from July.
Many economists had predicted inflation would decline slightly in August. Markets nosedived on the news, with the Dow falling 1,250 points — the most since June of 2020.
Consumer wallets are also getting hit hard at the grocery store. The food index had the largest 12-month increase since May of 1979, rising 11.4 percent over the last year, according to the Bureau of Labor Statistics report.
The White House event, filled with Biden supporters, began with a performance by singer-songwriter James Taylor, who said “this is a time when the world needs to cooperate more than ever before” to respond to the “climate crisis.”
Senate Majority Leader Chuck Schumer also took the stage, claiming that the Senate Republicans who are trying to pass a national abortion ban Tuesday are pursuing an “extremist agenda.”
The Biden administration has hailed the bill for its provisions on lowering the cost of prescription drugs, combating the climate crisis, reducing the deficit, and making “the largest corporations pay their fair share of taxes.” Ahead of the midterms the White House has emphasized the Inflation Reduction Act as evidence that the Democrats are capable of successfully passing legislation.
House Speaker Nancy Pelosi claimed Tuesday that the bill “reduces inflation” and the deficit, and is “fully paid for by making the biggest companies and the wealthiest pay their fair share.”
However, despite what its name indicates, the bill will not tame record-breaking inflation in the near future, and may even make it worse, according to a report by the Congressional Budget Office (CBO).
The CBO report said it estimates the bill will have a “negligible effect on inflation” in 2022. For 2023, the agency predicted inflation would be .1 percent lower or higher than it is currently due to the passage of the bill.
A report published by the Penn Wharton Budget Model (PWBM) found the bill’s “impact on inflation is statistically indistinguishable from zero.”
During his remarks, Biden suggested that the passage of the Inflation Reduction Act was just the beginning of his legislative agenda, vowing to build on the victory by signing a law that would “ban assault weapons.”