A letter sent to House and Senate leadership from 230 economists argues that the Inflation Reduction Act is expected to contribute to skyrocketing inflation and will burden the U.S. economy, contrary to President Biden and Democrats' claims.
The economists wrote in the letter first obtained by Fox News Digital that the U.S. economy is at a "dangerous crossroads" and the "inaptly named ‘Inflation Reduction Act of 2022’ would do nothing of the sort and instead would perpetuate the same fiscal policy errors that have helped precipitate the current troubling economic climate."
Sen. Joe Manchin, D-W.Va., announced last week he reached an agreement with Senate Majority Leader Chuck Schumer, D-N.Y., on the $739 billion reconciliation package after more than a year of negotiations among Democrats.
The economic experts point to the $433 billion in proposed government spending, which they argue "would create immediate inflationary pressures by boosting demand, while the supply-side tax hikes would constrain supply by discouraging investment and draining the private sector of much-needed resources."
They also write that of "particular concern" is the corporate minimum tax that they say will undercut efforts to restore functioning supply chains.
In addition, the bill's prescription drug provisions "would impose price controls that threaten healthcare innovation, creating a human health toll that would add to the financial woes that Americans are already experiencing."
A few of the notable signers include Nobel laureate Vernon Smith, former Chair of the Council of Economic Advisers Kevin Hassett, former Director of the Office of Management and Budget Jim Miller and Robert Heller, former president of the Federal Reserve Board 1986-1989.
In addition, professors from the University of Chicago, Princeton University, Duke University, the University of Virginia, Columbia University and the University of Notre Dame, among others, were listed on the letter dated Aug. 3.
The experts conclude that although they agree with an "urgent" need to address inflation, Manchin's bill is a "misleading label" applied to legislation that would achieve the "opposite effect."
The letter was sent to Schumer, Senate Minority Leader Mitch McConnell, R-Ky., House Speaker Nancy Pelosi, D-Calif., and House Minority Leader Kevin McCarthy, R-Calif.
Schumer has touted the Inflation Reduction Act as an immediate solution to inflation, which reached a new 40-year high last month.
"The Inflation Reduction Act will lower inflation, lower the costs of prescription drugs, close loopholes long exploited by big business who pay no or little taxes," Schumer said Thursday on the Senate floor.
In addition, Biden urged Congress to pass the bill during a virtual roundtable Thursday. "My message to Congress is this: Listen to the American people," he said.
"This is the strongest bill you can pass to lower inflation, continue to cut the deficit, reduce health care costs, tackle a climate crisis and promote America’s energy security and reduce the burdens facing working-class and middle-class families," Biden continued.
However, Republicans are less enthusiastic about the more than $700 billion spending and tax package.
McCarthy told Fox News on Wednesday that "Democrats have no plans to solve all the problems they created" and Manchin's bill is not the solution.
In the Senate, McConnell stated this week that most of his colleagues were "somewhat shocked" about Manchin's reversal of previous positions. He continued, telling Fox News that the bill raises taxes and "calling it an inflation reduction bill is rather laughable."
"Democrats are catastrophically out of touch with what American families actually care about. Their approval ratings show it. And their reckless taxing and spending spree proves it, as well," said McConnell in a statement this week.
The Senate is set to convene on Saturday to vote on a procedural motion to move the bill forward. It is still unclear if Sen. Kyrsten Sinema, D-Ariz., will support the legislation, and her vote is necessary for final passage of the bill under reconciliation rules that would allow a majority to pass.
Democrats previously touted a letter from 126 economists supporting Manchin's bill.