Francis Chung/E&E News
Joe Manchin
Sen. Joe Manchin speaks to reporters outside his office on Capitol Hill, July 18, 2022.
Ostensibly, the reason Joe Manchin killed what remained of his own Democratic Party’s agenda was that it contributed to inflation.
In fact, it did nothing of the kind.
The three chief components of the bill that Manchin rejected were a tax hike directed at the rich and corporations, deficit reduction, and spending on energy, both green and otherwise. But the proposed tax hikes were actually anti-inflationary. In the current bout of inflation, it’s the wealthy who can and do continue to spend merrily along, and in some particularly inflationary markets, like housing, they play a major role in bidding up the costs. Moreover, the additional funds that these particular tax increases would bring into the government’s coffers would reduce the federal deficit, which is why the Committee for a Responsible Federal Budget released a statement today calling for tax increases.
Second, the bill that Manchin axed devoted, at his previous insistence, roughly half of those increased revenues explicitly to retiring a portion of the federal debt—again, in the assessment of the CRFB and the old-school conventional wisdom (which is the kind of wisdom to which Manchin subscribes), a sure-fire way to reduce inflation. In actuality, the relation between deficits and the debt and the current bout of inflation is shaky at best, but to the extent that we can plumb the Mind of Manchin, debt retirement is surely anti-inflationary.
Which brings us to the proposed bill’s third component that ended up on Manchin’s cutting room floor: spending to boost both fossil fuel (which, again, had been added at his insistence) and green energy initiatives. But how inflationary were those? Increasing drilling and, consequently, the supply of oil and gas is likely to bring down the price at the pump. Increasing the supply of sustainable energy isn’t likely to reduce costs in the short term, but in the long term, it’s a huge cost saver when balanced against the costs of dealing with the havoc that the climate crisis is causing both now and in the future.
So, Manchin says he’s concerned about the inflationary effects of the bill he killed? That has all the earmarks of a Very Big Lie. Given the counter-inflationary consequences of the proposal he killed, the only plausible reason for his decision was his outright opposition to boosting energy sources that challenge and ultimate threaten the Rule of Fossil Fuel—a rule from which the Oil, Gas and Coal industries, and Manchin himself, grow steadily richer.
By the way, if Manchin is concerned even the least little bit about inflation, he might assent to greatly increasing the number of prescription drugs that the remaining legislation could add to the list of drugs that Medicare could bargain over. If you believe he’ll do that, I have a bridge to Brooklyn I’d like to get off my hands; let me know if you’re interested.
