Analyses: Build Back Better Strengthens Growth, Won't Ignite Inflation

 

Moody's Analytics outlines the economic impacts of the $1.75 trillion Build Back Better social infrastructure bill, expected to be voted on today by the House, along with the $1.1 trillion infrastructure bill:

Lawmakers in Washington DC continue to work feverishly on another massive fiscal plan, including a more than $1 trillion bipartisan infrastructure deal and a $1.75 trillion package of social spending and tax breaks to lower- and middle-income households that the Biden administration and congressional Democrats hope to pass into law via the budget reconciliation process. While the legislation remains in flux, it is similar in spirit to the Build Back Better agenda President Biden proposed earlier this year. If this is close to what becomes law, it will strengthen long-term economic growth, the benefits of which would mostly accrue to lower- and middle-income Americans. The legislation is more-or-less paid for on a static basis and more than paid for on a dynamic basis through higher taxes on multinational corporations and the well-to-do and a range of several other pay-fors. Concerns that the plan will ignite undesirably high inflation and an overheating economy are overdone, as the fiscal support it provides will ensure the economy only returns to full employment from the recession caused by the COVID-19 pandemic. Because the package includes a myriad of spending and tax initiatives, some of which are new and uncertain, implementing this legislation as intended and in a timely way will take deft governance. In this white paper, we assess the macroeconomic impact of both the bipartisan infrastructure deal legislation and the reconciliation package of social spending and tax changes.  (our emphasis)

"Concerns" and constantly shifting goalposts of conservaDems notwithstanding, this analysis by a highly respected business and financial services company dovetails with one from the Joint Committee on Taxation, also released yesterday, on the social infrastructure bill's  impact on the deficit:

The nonpartisan Joint Committee on Taxation released Thursday its initial analysis of Democrats’ major social spending and climate bill, judging that the “Build Back Better Act” would raise $1.48 trillion in revenue over a decade and be unlikely to add to the deficit long term.

The results are a boon for Democrats, and the report itself clears one of the last remaining hurdles keeping the House from holding a vote on the bill — a demand by moderates to see at least one major nonpartisan analysis of the bill’s effects.

The JCT and the Congressional Budget Office traditionally evaluate the impacts of major legislation on the federal budget, and their assessments carry weight with lawmakers on both sides of the aisle. It was not clear Thursday when the CBO would release its report. (our emphasis)

If those conservaDems can't read or face facts, one must assume they're sinking this bill for other reasons, reasons that have become increasingly obvious to most observers.