The Inflation Reduction Act that passed the Senate after considerable wrangling and compromising within the Democratic Party is nowhere near as large as the originally proposed “Build Back Better” bill. It is, however, more than 750 pages long.
Long, complicated bills have become somewhat cliche in Washington. As House Speaker Nancy Pelosi famously said about the Affordable Care Act in 2010, “We have to pass the bill so that you can find out what is in it.”
Critics say she was taken out of context, but context, and content, is the whole point. How many lawmakers have time to read a bill of that size before a vote is taken? How many instead simply rely on assurances from leadership or lobbyists?
And, finally, how good could any legislation be that includes leveling compromises from within only one political party? Even Medicare, a controversial and expensive program first approved in 1965, passed both the House and Senate with considerable support from Republicans.
That is why you don’t see efforts to repeal it every time power shifts in Washington.
The death of the notion that the party in power should strive for bipartisan support is one of the most disturbing political trends of the 21st century. It turns some issues into endless political football games.
The Inflation Reduction Act is far from perfect. Sen. James Lankford, R-Okla., was quick to point out absurdities sprinkled throughout. There is $4 billion to study ways to reduce the methane produced by cows — “cow burping,” Lankford called it. There is a fee on methane that would raise the price of natural gas by an estimated 17%. Imported oil gets taxed and domestic oil production gets fees imposed on it if pumped from federal land. Despite promises, the 87,000 new IRS agents to be hired would not have to confine their audits to people making $400,000 or more, he said. That limit isn’t in the bill.
Big bills equal big opportunities for mischief, but that mischief can, itself, be taken out of context.
The Tax Foundation, a Washington-based research group, said “the most economically damaging provision in the bill” is the 15% tax it would impose as a minimum tax on corporate “book income,” or the amount corporations report on their financial statements to stockholders. This amount, the foundation said, often does not reflect financial reality. The net effect of this tax would be a 0.1% reduction in GDP and the loss of 23,000 jobs.
The flip side of this, however, is that it might force corporations to pay more in taxes, something many people view as a matter of fairness. However, as the foundation notes, all tax hikes trigger unforeseen consequences. Corporations may simply begin to reduce the amount of profits they report to stockholders, putting these in line with other income statements.
We would be wrong to ignore the good things the bill could produce, such as nudges toward cleaner energy at a time when much of the American West, including Utah, is in a climate-change induced drought.
It would allow Medicare to negotiate drug prices with drug manufacturers, which could reduce the prices of prescriptions.
Many people who earn more than $400,000 per year would see a tax increase. Unless, that is, they find ways to reduce their taxable incomes to less than that. All told, the Tax Foundation estimates the bill would generate about $283 billion in net revenue over a decade, even though its net effect on the nation’s troubling inflation rate — the promise stated in the bill’s name — would be somewhere around zero.
But, of course, much can happen in a decade. Nothing is quite as tenuous as a large bill passed by only one party. Power tends to shift in Washington, and with newfound power comes the tendency to change what the other party did when it was in power.
That’s another reason the people Americans hire to run their business in Congress ought to be more devoted to the difficult, messy and politically hard work of forging compromises that reflect the diverse concerns of all Americans.
Without that, the nation keeps fighting the same legislative battles again and again, which helps no one.