Is the Inflation Reduction Act a win for the Democrats?
The law is designed to reduce not only inflation but also carbon emissions and prescription drug costs

A free daily digest of the biggest news stories of the day - and the best features from our website
Thank you for signing up to TheWeek. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.
The passing by the Senate of a $750bn bill to tackle climate change, healthcare issues and soaring inflation is being heralded as a major victory for Joe Biden’s party ahead of the November mid-term elections.
The Democrat-endorsed Inflation Reduction Act represents “the largest climate investment in US history”, said CNN. The “sweeping” package is also designed to cut prescription drugs and to tackle soaring inflation by reducing the federal deficit by $300bn.
The product of “painstaking” negotiations, the act is expected to pass in the House of Representatives on Friday, the broadcaster added – and gives the Democrats the chance to “achieve major policy objectives ahead of the upcoming midterm elections”.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
What would the act deliver?
Democrats have argued that the act “will tackle voters’ main economic concern”, but Republicans insist the new spending will simply “aggravate inflation”, said NPR.
The non-partisan Congressional Budget Office has said the bill would have a “negligible” effect on inflation in 2022 and into 2023.
The bill would also allow the federal health secretary “to negotiate prescription drug prices with pharmaceutical companies”, said The Guardian. Insulin prices for Medicare patients would be capped at $35 a dose and expiring healthcare subsidies would be extended for three years.
But the planned measures won’t “impact every prescription drug or every patient”, said NPR, and “won’t take effect quickly”, starting with ten drugs covered by Medicare from 2026 and expanding to 20 drugs by 2029.
While the bill’s likely impact on inflation and healthcare problems are a matter of debate, plans to invest $370bn in clean energy and climate package mark the “biggest victory for the environmental movement since the landmark Clean Air Act”, according to CNN. Experts have estimated that the bill’s provisions will reduce US carbon emissions by up to 40% by 2030.
A domestic win for Biden?
Overall, the bill “is a very scaled-down” version of a $3.5trn proposal put forward by Biden and his party last year, said NPR.
But the bill still “delivers a much-needed domestic win” for Biden at a time when his “popularity has sunk”, said The Guardian. He “can now go to the polls and portray himself as a president able to get things done even in the difficult political circumstances of a deeply divided country”.
The hotly debated economic impact of the bill, and how that plays out with voters, remains to be seen though.
Tackling healthcare costs and boosting green energy may a “priority”, but it seems “disingenuous to claim that what makes up this bill will have a deflationary impact”, wrote Kate Andrews, The Spectator’s economics editor, in The Daily Telegraph. The “handouts” included are likely to “fuel inflation”, and “other aspects of the bill will work against economic growth”, she argued.
Continue reading for free
We hope you're enjoying The Week's refreshingly open-minded journalism.
Subscribed to The Week? Register your account with the same email as your subscription.
Sign up to our 10 Things You Need to Know Today newsletter
A free daily digest of the biggest news stories of the day - and the best features from our website
-
10 things you need to know today: October 3, 2023
Daily Briefing Trump calls fraud case a 'sham' as trial starts, Matt Gaetz files resolution seeking to oust McCarthy, and more
By Harold Maass Published
-
The Tory tribes vying for influence at this year's party conference
The Explainer From free-market ultras to culture warriors, the party's electoral coalition is starting to fracture
By The Week Staff Published
-
5 destinations to visit this fall
The Week Recommends Have a frightfully good time in Sleepy Hollow or enjoy the foliage in Asheville
By Catherine Garcia Published
-
What to expect from an El Niño winter
The Explainer Things might be different thanks to this well-known weather phenomenon
By Devika Rao Published
-
What is biochar?
The Explainer The charcoal alternative formed from biomass could become the next climate solution
By Devika Rao Published
-
How climate change is going to change the insurance industry
The Explainer Some regions will soon be 'uninsurable'
By Devika Rao Published
-
Libya: the 'tsunami' that washed away a city
Talking Point Climate change may have made the storm more likely, but many blame failures of governance for the scale of the tragedy
By The Week Staff Published
-
How climate change is impacting sports around the world
Your favorite golf tournament or that long-awaited soccer match may look a bit different in the future
By Devika Rao Published
-
How the wealthy are impacting climate change, by the numbers
The Explainer The lifestyles of the rich and famous appear to be affecting the planet
By Justin Klawans Published
-
When and how could humans talk to animals?
We may be getting closer than we think
By Devika Rao Published
-
Cop28 and the fight to reach the Paris Agreement climate goals
The Explainer Al Gore says fossil fuel industry has 'captured' UN climate talks agenda
By Chas Newkey-Burden Published