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The Inflation Reduction Act Price Jumps From $385 Billion to Over $1 Trillion

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33 comments on The Inflation Reduction Act Price Jumps From $385 Billion to Over $1 Trillion

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Please consider Penn Wharton’s update to the Budgetary Cost of Climate and energy provisions in the Inflation Reduction Act. 

The 2022 Inflation Reduction Act (IRA) contained a range of climate and energy provisions that PWBM previously estimated to cost $384.9 billion over 10 years (FY2022 – 2031). Since that estimate, newer implementation details have emerged, and the fiscal year calendar has moved to start at FY2023. Our updated estimate for over 10 years (FY2023 – 2032) for just the climate and energy provisions is now $1,045 billion.

Senator Joe Manchin Feels Betrayed by President Biden, Told Ya So Joe

On March 29, I noted Senator Joe Manchin Feels Betrayed by President Biden, Told Ya So Joe

Told Ya So Joe

Flashback July 22, 2022 MishTalk: Will the Inflation Reduction Act of 2022 Do Anything at All?

I suspect Manchin is getting railroaded. The Administration will find a way to restrict oil and gas projects but fast approve what Progressives want.

In general, the best we can hope for is “nothing at all”.

There’s also a very real possibility there’s some language tucked in this deal that only a couple of lobbyists understand.

New Green Deal Trade War Accelerates

Flash forward to Feb 6, 2023 MishTalk: A New Green Deal Trade War Accelerates Between the US and EU

Tit for Tat (And Now Another Tit)

Perhaps CBAM is the EU’s way of striking back at the US for Biden’s IRA.

More likely, it’s just economic stupidity across the board as noted in Al Gore and John Kerry Aim to Hijack the World Bank for Climate Agenda.

Subsidies, tariffs, sanctions, and trade wars all have a cost. The result will be more inflation, more nationalism, and higher costs for consumers. 

I wish I was wrong about Manchin, but I wasn’t. 

The true costs begin to emerge. 

The key word in that sentence is “begin”. Expect more revisions to this newly revised $1 trillion+ cost estimate. 

Nothing in the bill will reduce inflation. It was a known lie right from the start.

This post originated at MishTalk.Com.

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Mike Shedlock

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33 Comments
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worleyeoe
worleyeoe
3 years ago
So let me guess, the $93T Green New Deal boondoggle is really going to cost $200T?
Is anyone really surprised?
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valh
valh
3 years ago
$600B added to Biden’s inflation bill raises the debt ceiling by an additional 20 percent. Does the new amount need to go back for negotiation. The added cost means that Yellen needs more Treasuries to fund the debt. And the Fed will continue its wider stance on QT, depressing long-rates, that will lower service costs on Yellen’s newly acquired obligations. Another 4 months of inverted yields, consumer inflation, and higher home prices. A likely source of the equity rally.
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Bam_Man
Bam_Man
3 years ago
“The Inflation Reduction Act Price Jumps Due to Inflation”.
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RonJ
RonJ
3 years ago
“The Inflation Reduction Act Price Jumps From $385 Billion to Over $1 Trillion”
They had to create more inflation in order to reduce it. Safe and effective.
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KidHorn
KidHorn
3 years ago
It was obviously going to be a boondoggle from the beginning, but I rather would waste money on it than give money to Ukraine.
Tesla might sell a million vehicles in the US this year. Not sure the % that qualify for the 7500, but I would guess close to 90%. That alone will cost about $6.5b. If the Cybertruck sells for under $80k, might add another hundred thousand or so vehicles to the list.
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babelthuap
babelthuap
3 years ago
As much as I roll my eyes at Congress and the clown town they operate in, end of the day the blame goes directly to the people that voted for them. Behind every Pelosi is and entire Army of “Pelosies” so to speak. What can be done? There is only one thing that can be done; find one’s own personal freedom. If they want to keep voting that I must pay for all their non essential needs then fine. There are ways to make them pay it all back and some.
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Hansa Junchun
Hansa Junchun
3 years ago
What’s with these hypocritical names all the major laws carry?
Affordable Care Act — makes healthcare unaffordable and puts sick people in debt forever
Student Aid & Fiscal Responsibility Act — makes school unaffordable and puts students in debt forever
Inflation Reduction Act — increases inflation and puts the nation into insolvency forever
…Does nobody in DC actually read these titles before they spew them out?
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KidHorn
KidHorn
3 years ago
Reply to  Hansa Junchun
No kidding. The next bill should be called the ‘Wonderful Act’. No matter what’s in it.
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RonJ
RonJ
3 years ago
Reply to  Hansa Junchun
The titles are a safe and effective way of fooling the public.
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Maximus_Minimus
Maximus_Minimus
3 years ago
Reply to  Hansa Junchun
The long tradition of telling people what they want to hear.
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MPO45v2
MPO45v2
3 years ago
Core personal consumption up 0.3% in March. Lol. JPOW will pound his interest rate fist harder now.
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GruesomeHarvest
GruesomeHarvest
3 years ago
No problem! We’ll just print up some more dollars to pay for it. Hundreds of billions for Ukraine? No problem! Trillion in unfunded liabilities? No problem! What could go wrong? Nothing. Nothing to see here. Move along.
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Jackula
Jackula
3 years ago
“Inflation reduction act”. What a hoot, should be called the create more inflation act…
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Dean2020
Dean2020
3 years ago
Our nation has gone full-retard.
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Zardoz
Zardoz
3 years ago
Mr cheney told us deficits don’t matter, and so far, they apparently don’t.
Our economy is like that guy at the bar that just keeps taking shots, but wont tip over.
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GruesomeHarvest
GruesomeHarvest
3 years ago
Reply to  Zardoz
“And so far nothing has happened.” The key word there is “so far”. The further this irresponsibility is kicked down the road, the worse the fall.
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hmk
hmk
3 years ago
Is that figure adjusted for inflation? If no, if you subtract inflation its actually negative.
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PapaDave
PapaDave
3 years ago
So how does one take advantage of this opportunity?
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TexasTim65
TexasTim65
3 years ago
Reply to  PapaDave
Well if you believe the numbers then Clean Energy and Clean Vehicles are set to get more than a half trillion dollars. Some of that will be tax breaks and not pure cash but it still means there will be plenty of companies there awash in cash.
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TexasTim65
TexasTim65
3 years ago
Reply to  PapaDave
Just saw an interesting article
No idea if this company is public or not. But if the idea really does work as described here, I would imagine the technology could be worth something.
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Lisa_Hooker
Lisa_Hooker
3 years ago
The Price will be Remembered long after the Quality is Forgotten.
With my sincere apologies to Mr. Royce.
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Bam_Man
Bam_Man
3 years ago
Reply to  Lisa_Hooker
I think you are paraphrasing Mr. Aldo Gucci.
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Lisa_Hooker
Lisa_Hooker
3 years ago
Reply to  Bam_Man
“The quality will remain long after the price is forgotten.” – Henry Royce
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Maximus_Minimus
Maximus_Minimus
3 years ago
With Chinese imports, it could be 385 billion or less, but built in USA it’s 1 billion plus. Econ 101.
Building up the supply chain alone will cost much more.
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MikeC711
MikeC711
3 years ago
You mean the government lied to us and said the bill would be 1/3 what it actually was? Say it ain’t so!!! And all of this new spending is to cut inflation. Brilliant!!!
Those who supported this are victims of the “A 2 at 10:00 is a 10 at 2:00” issue … and now their awake, with a headache, and laying next to a 2. Thanks from all of us who saw this coming.
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Counter
Counter
3 years ago
Inflation Maximization Act
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Nuddernoitall
Nuddernoitall
3 years ago
“Many a man has fallen in love with a girl in a light so dim he would not have chosen a suit by it.”
Maurice Chevalier
The illumination is always dim in Congress, as bills pass in the night, only to be seen for what they really are under the bright sunlight.
(For the record, that “Inflation Increasing Act” passed in the Senate 51-50.)
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Karlmarx
Karlmarx
3 years ago
Reply to  Nuddernoitall
“We [need] to pass the bill in order to find out what [is] in it.”
– N. Pelosi
Cockroaches always prosper in darkness
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Call_Me
Call_Me
3 years ago
No, Manchin doesn’t feel betrayed.
I suspect he knows how the script and how D.C. works better than anyone participating in this forum. Many on the outside (including our host) can describe the machinations of this particular I.R.A. and that the bill has nothing to do with inflation reduction. Joe vs. Joe was as staged as the action on the late mayor of Cincinnati’s talk show.
Call_Me_Al
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Karlmarx
Karlmarx
3 years ago
Reply to  Call_Me
In spite of how the media portray him, Manchin is a liberal democrat.
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JackWebb
JackWebb
3 years ago
Reply to  Karlmarx
Anyone who’s been there that long can be easily blackmailed.
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HippyDippy
HippyDippy
3 years ago
Reply to  Karlmarx
No. He’s like every other political figure; a common street hustler. Those labels are just to allow the slaves to deceive themselves. For the slaves do love their misery.
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HippyDippy
HippyDippy
3 years ago
Reply to  Call_Me
Exactly. I always find it amusing that anyone expects anything other than corruption out of any of those vile critters. At any level. Fool me once, I can see; but after being fooled every time, you really deserve what you get.
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