Tag: Build Back Better

Building Back Badly

 

On Sunday, August 7, along strictly partisan lines, the Senate passed the Biden administration’s misnamed Inflation Reduction Act (IRA), with Vice President Kamala Harris casting the tiebreaking vote. The bill avoided a filibuster after the Senate parliamentarian held that the energy and drug provisions were budgetary matters that satisfied the reconciliation procedure under the Byrd Rule. Some strategic concessions won over the two Democrat holdouts, senators Joe Manchin of West Virginia and Kyrsten Sinema of Arizona. As matters now stand, the IRA cobbles together a number of disparate programs whose common thread is taxing a wide range of activities to supply handsome subsidies, largely for health care ($64 billion) and climate and renewable energy programs ($369 billion).

The overall legislation is notable for its relentless ad hoc–ery and last-minute amendments. On the taxation side, there is a 15 percent book minimum tax, that is, income that companies report to their investors, free of the odd quirks found in the Internal Revenue Code. The IRA now tinkers with the carried-interest exception by extending the long-term capital gain treatment waiting period from three to five years, but only for people whose adjusted gross income exceeds $400,000. In the IRA, there is also a stiff excise tax on drug manufacturers and drug companies with the temerity to refuse supplying the government with prescription drugs at bargain prices under Medicare Part D. And the ARA allocates $80 billion to increased IRS enforcement over the next ten years. In its most recent analysis, published on August 2, the Tax Foundation concluded that the bill is much ado about nothing, estimating that it will generate about $304 billion over the next ten years, with only tiny changes in both GDP growth wages of -0.1 percent, and a loss of some 30,000 jobs over that period. Following Senator Sinema’s changes, at least one Democratic official maintained the IRA would still generate close to $300 billion.

Voters Want Sinema to Oppose Manchin’s New Spending Bill

 

Digital billboard in Phoenix, AZ, June 2021.

Sen. Joe Manchin (D–WV) made headlines last week when he flipped on Biden’s repackaged and reduced Build Back boondoggle. The cynically named “Inflation Reduction Act” promises to spend $369 billion on the environment while reducing the deficit by $300 billion. The bill also would raise corporate taxes and increase Obamacare spending.

Democrats celebrated Manchin’s support, but there’s another senator who would need to sign on. All eyes moved to Kyrsten Sinema. The Arizona maverick has kept quiet, but her constituents haven’t. A new poll shows Grand Canyon State voters want her to oppose the new tax-and-spend bill.

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Dr. Robert Moynihan of “The Moynihan Letters” and “Inside The Vatican Magazine” sent out this letter about the Canadian Trucker crisis. It included a short and very moving video from one of the Canadian truckers.  He shared the video of the trucker reading the note from an eleven year old, who was so moved by […]

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Join Jim and Greg as they analyze a tense exchange between the AP’s Matt Lee and State Department spokesman Ned Price over the UN’s approach to Russia. They also review a new poll that shows Americans are ready to move on from COVID-19. And they cheer for West Virginia Senator Joe Manchin as he pronounces the Build Back Better Bill dead again.

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Polls show that Americans are increasingly souring on Biden’s “Build Back Better” (Build Back Broke) $5 trillion massive spending boondoggle. That figure comes from the non-partisan analysts at the Congressional Budget Office (CBO) who were asked to factor in its costs over a full 10-year period. It is based on the bill the full US […]

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Rep. Jared Huffman, Democrat of California, joins “Plugged In”  hosts Josh Siegel and Neil Chatterjee to discuss a big week ahead in the House as it prepares to vote on the party’s climate and social spending bill.

He urges the Senate to keep intact the House’s version of the Build Back Better Act because, “we are late in the game and need to hurry up and get this over the finish line.”

Tax Schemes That Won’t Pay Off

 

Right now, Washington’s fevered political atmosphere is abuzz with taxation proposals to plug the funding gap created by President Biden’s slimmed-down $1.85 trillion Build Back Better program. Biden has no modest fiscal ambitions: he wants to introduce a huge new system of transfer payments to those at the bottom of the income scale, paid for by taxes that are imposed solely on the richest segment of the population, leaving just about everyone else untouched. His two major policy options—in an on-again-off-again fashion—appear to be a tax on the unrealized appreciation targeted to those who have more than $1 billion in assets or $100 million in income, and a 15 percent minimum corporate tax that Biden asserts will make big business pay its “fair share.”

House Speaker Nancy Pelosi touts this program as “something major, transformative, historic, and bigger than anything else” that Congress has ever attempted—which is exactly why a thumbs-down verdict is warranted, even before its details are laid out. One key classical liberal requirement for good government is the stability of key social institutions, including, prominently, taxation. Stability does not entail total stasis; after all, government must be able to respond to a changed global environment which, whether anticipated or not, may require rapid revisions in revenue needs. But stability does caution against making major structural changes in short time periods, without anticipating the range of complications bound to follow sudden social transitions.

The new system’s administrative costs, the high likelihood of technical error, and the nonstop, evasive maneuvers of targeted taxpayers to avoid or minimize the new tax regime make it a virtual certainty that tax revenues will fall short of projections. Overall economic growth, meanwhile, will likely falter, often with unanticipated distributional consequences that make both the rich and poor worse off.

Stalking Sinema, Menacing Manchin, and Talking Trillions is Political Theater

 

Manchin Sinema SenatorsDo not be distracted by headlines, video clips and dollar signs. Stalking Senator Sinema, and menacing Senator Manchin, was indeed part of the process, the process of passing a radical rigging of politics and society. The wedding crashers, harassing Senator Sinema and ruining the big day for a bride and her mother, were bad theater this past weekend. The supposed negotiation over trillions in the reconciliation bill is primarily a deception campaign, luring the Republican establishment into going all green eyeshades about taxes and debt. Do not fall for the con, keep focused on the real game.

The recent stalking of Senator Sinema and menacing of Senator Manchin made for great political theater, complete with smartphone video. We got several news cycles of reactions. The president and establishment media declared the intimidation campaign “part of the process,” minimized the threats, and suggested Manchin and Sinema had it coming. Conservatives expressed outrage at the thugs and their establishment enablers. We can expect the same with the Arizona wedding stunt. All of this provided cover for Manchin and Sinema to eventually sign onto the radical reconciliation bill, and it will be radical, whatever the final sticker price.

Radical Reconciliation

Senator Manchin Objects

 

ManchinSenator Manchin defied his party, dominated by the far left, and showed far more respect for our constitutional republic than has become customary. He issued a statement on camera on November 1, laying out his enduring objections and expectations as a senator from West Virginia. Manchin defied progressives’ demands as Biden nodded and slept his way through the only COP he and his party support. Senator Manchin defended the Senate against the House, and the Congress against the Executive. He reiterated a series of substantive objections about effects on the present and future of America.

The Democratic Party leadership in Congress failed to leverage Biden’s appearance on the international stage as a pretext for rushing through major legislation. In particular, Speaker (of the House) Pelosi failed to crowd Senator Manchin into doing the bidding of the House Progressive Caucus. Manchin’s words reflected what was once centrist political orthodoxy, but now trigger instant outrage and tantrums from the leftist core of today’s Democratic Party.

I am very cautiously encouraged by Manchin’s latest statement, his apparent position after the Build Back Better Act was supposedly slimmed down from $3.5 trillion to $1.75 trillion. He seems to be pushing back on both policy and real costs. On policy, Manchin objects to major growth in the scope of federal government involvement in Americans’ lives, and to energy and economic harms. On costs, he calls pure applesauce on the budgetary gimmicks. My analysis of the Build Back Better Act concludes it is radically leftist, transformational in its effects on America. Senator Manchin just might help save our constitutional republic for a season.

Hubwonk host Joe Selvaggi talks with Kyle Pomerleau, senior fellow on federal tax policy at American Enterprise Institute about the Build Back Better Act now in Congress, to understand how those new taxes will affect individuals, business, and the economy.

Guest:

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Three statements, posted on the Senate web pages of Senator Manchin (D-WV) and Senator Sanders (S-VT) are worth reading. Each address the Xiden-Socialist scheme to truly transform America through the means of one massive piece of legislation fraudulently styled a budget reconciliation bill for the purpose of evading the Senate 60 vote cloture rule. They […]

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I missed the Biden speech today. If you did, here it is linked: He opened his anticipated Afghanistan press conference today to the American audience, as well as the rest of the world with this WEF slogan!  The “Build Back Better” mantra has been mouthed by many world leaders over the last 18 months (right […]

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