Here’s How a GOP-Controlled House Could Fight Inflation

Republicans are set to regain the majority in the House in next month’s midterm elections, and they are already signaling steps they would take to try to address inflation, which is seen as the biggest issue in the November races. .

The GOP could have limited power with only a House majority, and even if the party also regains the Senate, it is unlikely to have a filibuster-proof majority.

President Biden’s veto pen is another factor, meaning Republicans may have to compromise with the White House and Democrats to enact their policies.

Republicans have given signals on some areas they intend to focus on, though details of their anti-inflation plans are thin.

Here are some things the GOP plans to do to counter inflation.

Reduce your expenses

(File: Getty)

Republicans have spoken out against trillions in Democratic-backed spending in areas such as coronavirus relief, student loans and non-military funding, while framing policies under an unchecked government spending model.

The party has made clear its opposition to the US bailout, a sweeping $1.9 trillion coronavirus relief and recovery package passed without GOP support last year, as well as the Democrats’ inflation cut and the Biden administration’s sweeping student loan forgiveness plan.

Republicans are also increasingly confident about their prospects for shaping government funding for fiscal year 2023, as more polls have shown the party gaining the upper hand in key races that could determine control of Congress. .

However, even as they tackle non-defense spending, many Republicans have pushed for higher defense funding, pointing to rising material costs.

Debt ceiling

Raising the debt ceiling is likely to be a huge fight in Washington if the GOP takes over the House.

Raising the debt ceiling has little direct effect on inflation. Although government spending has some link to inflation, the debt ceiling needs to be raised to account for past spending by Congress.

Congressional lawmakers reached a deal to raise the debt cap by $2.5 trillion in December 2021, days before the scheduled default date. This action has allowed the US to avoid a default until at least 2023, when another increase or suspension will likely be needed to avoid economic turbulence.

Republicans could use the new deadline as leverage in negotiations to cut spending, delaying any action on the debt ceiling in an attempt to force Democrats into concessions. GOP lawmakers followed a similar path in 2011, when the House Republican majority hijacked changes to the debt ceiling in an effort to secure deficit reductions.

The standoff led Standard & Poor’s to lower the US credit rating for the first time to AA+. Before that, it had never fallen below AAA.

Asked by Punchbowl News if Republicans would make rights reforms in the debt ceiling debate, House Minority Leader Kevin McCarthy (R-Calif.) said he wouldn’t “predetermine” anything, making fear that programs like Social Security and Medicare risk.

He sought to tame these concerns a day later, telling CNBC in an interview that he “never mentioned Social Security or Medicare,” while doubling down on his statement that behavior change needs to take place over the cap. the debt.

Energy

An undated photo provided by the Department of Energy shows crude oil pipelines at the Bryan Mound site near Freeport, Texas. (Department of Energy via AP)

House Republicans are pushing energy independence as a way to cut costs.

Gasoline prices have fluctuated in recent months, peaking at more than $5 a gallon on average nationally in June before falling back to $3.82 a gallon on Friday. according to AAA.

Pump prices have risen partly because of Russia’s invasion of Ukraine. Concerns over gas prices intensified this month after OPEC and its oil-exporting allies, including Russia, announced a 2 million barrel-per-day cut in oil production.

In the House GOP conference’s midterm policy and messaging platform, dubbed the “Pledge to America,” Republican lawmakers pledged to “regain American energy independence and lower prices to the pump” by maximizing home energy production and reducing the permitting process to reduce US dependence on other countries.

“The hard workers of this country are paying the price. Everything is more expensive with us and our enemies are growing bolder. President Biden must turn the tide and take meaningful action to unleash American energy,” said Rep. Cathy McMorris Rodgers (Wash.), the top Republican on the House Energy and Committee, said in one sstatement following the announcement of OPEC+.

House Minority Whip Steve Scalise (R-La.) told “Fox News Sunday” that if the United States produced more energy domestically, “we would reduce energy costs like we did there two years ago.”

The prospects for lower gas prices thanks to energy independence in the short term, however, are slim. Many decisions about whether to drill for oil are made by private companies rather than government policy.

And when it comes to oil over which the federal government has authority, new onshore drilling leases typically take about 4.5 years on average to deliver the oil to the pump.

Supply Chain

Supply chain issues have been seen as a major cause of inflation, although more recently they have been seen as less of a problem.

In a policy agenda unveiled by top House Republicans last month, leaders focused on strengthening the country’s supply chains.

“This year’s frightening infant formula supply shock was just the tip of the iceberg of a broken supply chain that drove up costs and left store shelves empty,” the diary reads. “Record inflation is driving increases in the price of basic necessities, while our country remains dangerously dependent on foreign countries like China for essential supplies, medicine and technology.”

The diary does not provide more information for the push, although the effort comes a year after more than 100 Republicans write a letter to Biden opposing certain regulatory measures and social spending related to supply chain issues.

Taxes

An IRS Form 1040 for 2021 is being held for photo illustration on Friday, April 15, 2022.
An IRS Form 1040 for 2021 is being held for photo illustration on Friday, April 15, 2022.

Republican leaders have also set their sights on tax changes, with some pushing for an extension of tax cuts included in former President Trump’s 2017 tax bill.

According The Washington Post, the provisions of the law that Republicans plan to make permanent include language relating to personal tax rates. The newspaper also reported interest in scrapping some corporate tax increases.

In the House GOP policy platform to fight inflation and lower the cost of living, leaders are pushing for “growth-friendly tax and deregulation policies” that they say would “raise take-home pay, create well-paying jobs and bring stability to the economy. ”

McCarthy also reportedly signaled support for a push by Rep. David Schweikert (R-Arizona) to make other parts of Trump’s tax bill durable.

At the same time, Republicans have spoken out against provisions pushed by Democrats seeking to pay for funding in areas such as health care and climate with tax increases targeting corporations and wealthy individuals – and some have keep hope for other challenges to these measures as well.

Updated at 8:45 a.m.

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