(The Center Square) – The $740 billion Inflation Reduction Act passed by all 50 Senate Democrats with the tie-breaking vote cast by Vice President Kamala Harris on Sunday will harm the economy, Iowa Republicans say.
The bill passed the Senate after a marathon session of votes during which Democrats blocked most amendments proposed by Republicans. It’s headed to the House, where it’s expected to pass. The president is also expected to sign it.
Iowa U.S. Senators Chuck Grassley and Joni Ernst, both Republicans, voted against it.
“Families across America are suffering from 40-year-high inflation, fueled by a partisan anti-energy, anti-growth tax-and-spend agenda,” Grassley said in a statement. “Democrats ignored their own economists when they spent $1.9 trillion to get us in this mess. Now they’re ignoring independent analyses warning that this bill is going to cause even more pain. This partisan bill, written behind closed doors without any input from Republicans, will raise taxes, cut jobs, kill cures and fuel inflation – all at the worst possible time. The American people have endured enough.”
Democrats blocked Grassley’s amendment to increase the Child Tax Credit, the Dependent Care Credit, education-related tax credits and deductions and a student loan interest deduction, another news release from his office said. The amendment also would prevent taxation of the first $300 ($600 for married filers) in interest income and double the income ceiling for the zero-rate tax bracket for long-term capital gains and dividend income and extend the state and local tax deduction cap.
He said the bill would hurt research and development of new medications and therapies, based on a University of Chicago study and the Congressional Budget Office’s predictions.
“My amendment made modest yet commonsense adjustments to our tax policies that would have delivered real relief to American families struggling under the pressures of inflation and recession,” he said. “Democrats had an opportunity to give American families new tools to cope with rising prices brought on by their reckless spending agenda.”
Ernst made a statement Aug. 7 on Twitter.
“We’re in a recession. Inflation is at a 40-year high,” Ernst said. “Do Democrats really think now is the time to raise taxes and spend billions more? Yes, they do. And their reckless #TaxAndSpendSpree is proof.”
Senate Democrats rejected Ernst’s amendment to prohibit the disbursement of the Clean Vehicle Credit for electric vehicles containing parts from nations that are under investigation by the Biden Administration for forced labor practices, the news release said. The Senate’s annual defense bill, the National Defense Authorization Act, prohibits electric vehicle components from any entity that uses child or slave labor, the release said.
“We all know the critical minerals that comprise EV batteries are largely mined in sub-Saharan Africa by companies abusing children, which are then assembled in Chinese-owned factories, many of which use slave labor,” Ernst said on the Senate floor “Subsidizing to the tune of $7,500 per person the purchase of a luxury vehicle for wealthy coastal elites that utilizes slave or child labor is a direct contradiction of our American values.”
Iowa Rep. Steven Holt, R-Denison, said the course ahead is “dangerous” economically. He said inflation and supply chain issues will get worse, and spending and tax increases are the opposite of what should be done during severe inflation and the beginning of a recession.
“Democrats and to a lesser extent Republicans in Washington DC have supported out of control spending and deficits that have weakened our economy and our competitiveness, and will make it more likely that China will emerge as a dominant economic & military power. … I also believe that all of these programs have ushered in an era of socialism from which we may never recover. I fear that historians will look upon this time and conclude that this is when America ceased to be America.”
He said the cost of diesel fuel, fertilizers and chemicals used by farmers and the price of food and gas have been horrific for Iowans, and the bill makes it worse.
“In Iowa, Republicans have taken the opposite approach- less government and lower taxes, but there’s only so much we can do on the state level in response to bad economic and social policy on the national level that undermines our future,” he said.