The path ahead for Biden: Overcome Manchin's inflation fears

[TexasTowelie]

By Jim Tankersley, New York Times Company

Monday, Dec. 20, 2021 | 2 a.m.


WASHINGTON — Sen. Joe Manchin effectively killed President Joe Biden’s signature domestic policy bill in its current form Sunday, saying he was convinced the spending and tax cuts in the $2.2 trillion legislation will exacerbate already hot inflation.

Economic evidence strongly suggests Manchin, D-W.Va., is wrong. A host of economists and independent analyses have concluded that the bill is not economic stimulus, and that it will not pump enough money into consumer pocketbooks next year to raise prices more than a modest amount.

The reason has to do with the pace at which the bill spends money and how much it raises through tax increases that are intended to pay for that spending. The legislation spends funds over a decade, allowing the taxes it raises on wealthy Americans and businesses, which will siphon money out of the economy, to help counteract the boost from spending and tax cuts.

The bill also does not provide the type of direct stimulus included in the $1.9 trillion pandemic aid package Biden signed in March — and which Manchin supported. Some of its provisions would give money directly to people, like a continued expanded child tax credit, but others would fund programs that would take time to ramp up, like universal prekindergarten.

Read more: https://lasvegassun.com/news/2021/dec/20/the-path-ahead-for-biden-overcome-manchins-inflati/

[bucolic_frolic]

1. Sort of.

Tax increases on the rich won't siphon money out of the economy. It will take it from their static assets and monthly cash flows, which they don't spend anyway. They either buy luxury assets - how many can you buy? - or the put it in the market or yielding financial assets. The bill would divert that into programs and the paychecks it produces and into tax reductions for working people - all of which is spent monthly.

Inflationary? Yes, in the short run. But less so than Stim1-2-3. But all is not lost. Slice and dice BBB into parts and pass them. Deliver it without inflation. Keep feet in motion. And realize that 6 months from now, inflation will be slowing and spending will be weak. We'll welcome more expansive fiscal policy then.

[EYESORE 9001]

2. Manchin is in the pocket of special interests

He likely knows it won’t exacerbate inflation, but it makes a handy excuse.

[WHITT]

3. No Inflation Fears

Manchin is simply LYING. He's been lying all along, and he's still lying.

The BBB is paid for, so it cannot be inflationary.

[Ray Bruns]

5. Agreed. Manchin never intended to vote for the bill in the first place.

Lying sack of S!&T

[Scrivener7]

4. No. Find the skeleton in his closet and twist his arm hard.

[quaint]

6. +++

[Paladin]

7. +1000

Biden needs to go Full Lyndon Johnson on Manchin. LBJ made it his business to know everything about everybody in D.C., and to put that knowledge to use, when required. Manchin's bound to have some dirty laundry---it needs to be found and used against him, immediately.

[dlk]

8. It wasn't inflation that concerned Manchin

He’s shown himself to be a prejudiced snob who’s against doing anything to help Americans who aren’t rich.