Tax credits that can be used on expensive electric vehicles like teslas, limiting prescription medical costs to 2k per year, selling drilling licenses in Alaska - sounds pretty imperfect to me. Thought the fact the Republicans are so against it gives me some solace.
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American politics
- Thread starter Danishfurniturelover
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Tax credits that can be used on expensive electric vehicles like teslas, limiting prescription medical costs to 2k per year, selling drilling licenses in Alaska - sounds pretty imperfect to me. Thought the fact the Republicans are so against it gives me some solace.
Rorschach
Sonny Walters
I've listened to a few podcasts about what's in the bill and it is a massive win overall. There are a few poison pills in it but nothing too significant. And as you say the GOP is spluttering with rage so all good.
Edit: I don't think Teslas qualify for the EV tax credits as far as I know. Also, the drilling leasing on fed lands really have a small uptake of about 1.5% of offered leases typically and this bill hammers the supply side demand which will make these developments very risky going forward. One of Manchin's provisions of course but not a huge hit.
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Should have kept it all in email format and destroyed them instead. He'd have got away with it then.
Anti-inflation Bill is an interesting choice of name when it will restrict investment and push up prices in a country that's suffering from demand-side inflation.
Maybe Biden has relabelled the Big Red Button as the Cuddly Kitten Launcher so that the public will just accept it when he presses it.
Rorschach
Sonny Walters
LOL. Well that is the opposite of what it will do actually. The intent of a large portion of the bill is to incentivise moving renewable supply chains into the US. I think I'll go with the experts on this one. Feel free to Dunning Kruger this if you wish
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That's one small sector. The taxation on both companies and share movements will reduce investment. Reduced investment will both increase costs and output, further increasing costs by restricting supply. Companies will be expected to pay larger dividends to make up for the fact that they can't buy back shares efficiently - also reducing investment with the same effect.LOL. Well that is the opposite of what it will do actually. The intent of a large portion of the bill is to incentivise moving renewable supply chains into the US. I think I'll go with the experts on this one. Feel free to Dunning Kruger this if you wish
I'm sure the renewable market will do very well out of it but the rest of the country won't.
Rorschach
Sonny Walters
It is a huge sector and growing exponentially. This bill will incentivise massive growth in a hundred different ways and generate huge tax revenue (don't get triggered), and it is good for the climate obviously which is infinitely more important than worrying about a 1% tax for companies trying to pump their share value with buybacks. The stock market is not the economy, and arguably that practise should be forbidden anyway.
You also have to consider the bill as part of a broader set of bills affecting wider industrial policy that the admin has pushed through. The CHIPs bill also this week or the Infrastructure bill for example. Biden admin is performing miracles considering the razor-thin majority they have in the Senate of 48 senators and 2 corporate shills, and MSM are finally waking up to this fact.
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It is a large sector, but it's a much smaller than the entirety of the the rest of the economy.
All of those companies are being taxed to prop up one that should be capable of propping itself up. All of that increased taxation will increase prices and reduce investment. This bill is likely to spiral inflation that is already out of hand.
The bill itself isn't bad, per se, it's just the opposite of what it claims to be and terribly timed.
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Also worth considering that if the renewables industry were about to make such a dramatic return, investors would be piling money into it and govts wouldn't need to be picking winners with our money.
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Rorschach
Sonny Walters
It's not the opposite of what it claims and that renewables are smaller than the entire rest of the economy is a strawman argument.
The bill is modeled as having a moderate to small deflationary effect overall. But it is a climate bill to all intents and purposes and that it is named as as inflation bill now is somewhat misleading but certainly not the opposite as you claim. The reason for that is to make it harder for the GOP to attack. Harder to say they are against the inflation reduction act than they are against a climate bill. Another reason for the name is because of the filibuster these mega bills have to be pushed through reconciliation and as such have to sound financy.
The extra tax companies are paying is not extra. It is tax they have been avoiding using a loophole where they pay fudge all. I know that is a wet dream to libertarian types but it's a loophole that should be closed. And 90k extra IRS agents too. Yippee!!
As for timing yes it is badly timed. Years if not decades overdue but better late than never. I fudging delighted they got this through even though it is not as radical as I would have liked. It is a massive win for Biden and will help him with progressives and the younger voters who beginning to lose patience.
Anyway, that's it for me on this.
Edit: Core inflation last month was 0% I read today. So peaked and on the way down like the petrol (gas) prices.
It doesn't really matter at all whether you think taxation loopholes should be closed or not, the fact that they have will be inflationary. In order to maintain shareholde earnings, prices will have to increase - tax is an expense like any other and operates in the same way. When a govt then hands that out it creates more spending power and the cycle continues.
Short term slowing of inflation doesn't really mean a huge amount without large and sustained levels of deflation - nobody wants current prices baked in and it's foolish at best to throw out more money before inflation, interest rates, borrowing and money printing are minimised.
If politicians are determined to prop up industries that cannot do so themselves, that's their folly. Doing so with such a high risk of inflation and borrowing at such high levels is dangerous for everyone.
Rorschach
Sonny Walters
I'd say we are still only seeing the very tip of the iceberg with this nuclear documents brick.
There's something in that coffin, isn't there?
Will the GOP hierarchy finally abandon him? I'd say no. Showing millions of people who worship Trump like some kind of demi-GHod that they are actually monumentally stupid would require courage that no one in that party has.
There's something in that coffin, isn't there?
Will the GOP hierarchy finally abandon him? I'd say no. Showing millions of people who worship Trump like some kind of demi-GHod that they are actually monumentally stupid would require courage that no one in that party has.
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Rorschach
Sonny Walters
The Rosenbergs were executed for the same.