Brian Deese says taxing rich and prescription drug cost reform will ease inflation
Tax the rich and approve a prescription drug bill: White House economic adviser Brian Deese suggests ways to make a ‘real difference’ at ‘unacceptable’ inflation levels
- “Prices are currently unacceptably high,” the economic adviser said
- May figures indicated that prices are 8.6 percent higher than a year ago
- “Reducing the cost of prescription drugs is one thing. Reducing energy costs through energy tax incentives is another piece,” Deese said
- “Equally important is reducing the federal deficit by enacting long-awaited tax reforms,” he added
- Biden has pushed for a 15 percent minimum tax and an end to Trump’s 2017 tax cuts for corporations and high earners
National Economic Council director Brian Deese pointed his finger at Congress for the solution to contain inflation, arguing Sunday morning that legislation to lower prescription drug prices and reduce the federal deficit would taxing the rich was the way to make a ‘real difference’.
“Prices are unacceptably high at the moment,” says the economic adviser. The May figures indicated that prices are 8.6 percent higher than a year ago.
“Reducing the cost of prescription drugs is one thing. Lowering energy costs through energy tax incentives is another, but equally important, component, lowering the federal deficit through long-awaited tax reforms,” Deese told CBS’ Margaret Brennan in “Face the Nation.”
Biden has pushed for a 15 percent minimum tax and an end to Trump’s 2017 tax cuts for corporations and high earners.
‘Raising taxes does not change the milk price. When and how do you actually bring this package forward?’ Brennan noted, adding that tax hikes and negotiations on the cost of prescription drugs failed when they were part of the president’s Build Back Better bill.
“Prices are unacceptably high at the moment,” said Brian Deese. May figures indicated that prices are 8.6 percent higher than a year ago
Deese said he was hopeful to see progress on a bill “in the coming weeks.” He also pointed to a bill making its way through Congress that would lower the cost of semiconductor chips, known as the CHIPS Act.
Senator Majority Leader Chuck Schumer, DN.Y., and Sen. Joe Manchin, DW.Va., has spent the past few weeks discussing a potential bill to lower the cost of prescription drugs. Democrats want to pass tougher legislation on President Biden’s legislative priorities after Manchin killed the $1.9 trillion Build Back Better bill.
Speaker Nancy Pelosi, D-Calif., said on Thursday that negotiations on a slimmed-down social spending package are “alive.”
Manchin gave lawyers a glimmer of hope last week that he would approve a prescription drug.
Drug pricing “is something we can all agree on,” Mr. Manchin said at an AARP event, adding “if we don’t do anything this year, that’s all that needs to be done.”
According to the Mayo Clinic, retirees in the US pay 10 times more for insulin than their counterparts in other wealthy countries.
The president, meanwhile, ignores criticism that his large expenses are the cause of high costs.
“I don’t want to hear any more lies about reckless spending,” he said. “We are changing people’s lives,” he said before the convention of the Federation of Labor and the Congress of Industrial Organization in Philadelphia.
Biden also told The Associated Press that he believed he had the votes to pass prescription drug cost reform and provide tax incentives for winterizing homes to lower energy costs.
“I believe I have the votes to do a number of things,” Biden said. “One, prescription drugs. Cut energy bills by providing — I think we’re going to have the opportunity to get a tax incentive for hibernation.”
Biden has already tapped Strategic Petroleum Reserves, which had a negligible effect on gas prices. Last week, he later wrote a letter to the CEOs of the country’s major fuel companies threatening to use his “emergency power” if they don’t take action to lower prices.
Federal Chair Jerome Powell has warned that the US economy will suffer even more damage before inflation falls from its 41-year high.
The Federal Reserve raised interest rates by 0.75 percent on Wednesday — the largest increase since 1994 — in a bid to curb inflation. Powell had warned last month that more walks are likely to follow in the near future.
The central bank’s move to raise interest rates by 0.75 will raise short-term interest rates, which affect many consumer and business loans, to between 1.5 and 1.75 percent. The result will drive up borrowing rates for homes, cars, credit cards and other items — making it much more expensive to borrow money.
“Inflation has clearly surprised positively in the past year and there may be more surprises to come. We will therefore have to be agile in responding to incoming data,” he said.
“We think the public generally sees us as very likely to bring inflation down to 2 percent. and that’s critical,” he noted. “It will take a while for inflation to fall again, but we’ll do that.”