Biden signed the "Reduction Act", which has been dragging for more than a year, who will benefit?

17.08.2022

Number of this text: 2396, the reading time is about 4 minutes older

Guide: In the short term, signals such as legislation and inflation will benefit Bayeng and Democrats.

Author | First Finance Elegant

On Tuesday (16th) local time, Biden signed the long -breaking "Reduction Act". This is the shrinking version of the "Rebuilding the Better Future" bill of $ 1.75 trillion last year. In his speech, Bayeng said: "This bill is the biggest step in climate issues."

The bill represents the largest climate investment in American history. It will invest about 370 billion U.S. dollars for low -carbon emissions and respond to climate change. %. In addition, the U.S. government will also invest $ 64 billion to extend the subsidy of federal health insurance, allowing the prescription price for the elderly who participated in medical insurance.

Investment consulting company BCA Research, the US chief political strategyist, Matt Gertken, told the First Financial Reporter that in the short term, Biden and Democrats will benefit from the signals such as legislation and inflation. It is showing a stable signs, but it remains at a lower level.

"The two parties have paid off on the votes of Congress, and the Democrats recapture the leading advantage from the Republicans again. If this trend continues, it will reduce the loss of the Democratic Party in the medium -term election." Getekin said, "If inflation continues to fall, it will continue to fall, and it will continue to fall, and it will continue to fall, and it will continue to fall. The actual salary will be improved, which will increase consumer confidence. If these can be realized before October, it may further help Democrats. "

Detailed solution of the bill effect

This $ 437 billion expenditure plan is expected to raise $ 737 billion in revenue in the next ten years. The largest pillar of income comes from the drug price of the beneficiary of the medical insurance and the increase in taxes to the enterprise. In addition, the enhanced enforcement of the IRS will also bring about $ 124 billion, which means that the audit of the rich is more severe and frequent. In the end, this will reduce the fiscal deficit of more than $ 300 billion in ten years.

Regarding the effect of the anti -inflation effect of the bill, the analysis of the US Congress Budget Office (CBO) found that the impact of the legislation on inflation in 2022 was "negligible." The CBO estimates that in 2023, the impact of the bill on the inflation rate was only between 0.1 percentage points.

In terms of tax increased taxes, the bill proposed a minimum tax of 15%of companies with an annual income of more than $ 1 billion and 1%of the stock repurchase tax. Taxes are used to pay renewable energy subsidies and expand medical reform subsidies. However, Wall Street believes that the corporate tax increased by the bill will not hurt most American companies.

Wells Fargo analysts wrote in the research report last week that although the new tax is "generally not good for stocks", the minimum tax of 15%of enterprises will not be "substantial".

The latest analysis of Creditkin Bank also shows that only more than 170 companies in the Standard 500 index paid by more than 170 companies last year were less than 15%. In these companies, nearly half of the companies may increase taxes in 2023. "Overall, the impact may be small. Maybe some companies may be more impacted than other companies? It is possible, yes. But the overall impact is not important for large companies." Credit Suisse Bank said Essence

In terms of reducing drug prices, Gartkin said that in general, the upper limit of drug prices is very popular, which is conducive to increasing social stability. 20 kinds of medicines are eligible to participate in medical insurance negotiations each year. "But the United States lacks medical insurance for national, so price control represents the economic transfer between enterprises or between enterprises and the government, rather than the transfer between enterprises and consumers. The upper limit of drug prices will benefit insurance companies directly. Consumers are just indirectly indirectly. Benefit. The profit will be transferred from the hands of the Da Pharmaceutical Factory to the big insurance company. "He said.

In terms of electric vehicle subsidies, new electric vehicle buyers can receive up to $ 7,500 tax subsidies, and second -hand car buyers can get a $ 4,000 reduction, but the conditions for obtaining subsidies are more harsh. Once the measures come into effect, 70%of the 72 models are currently qualified to obtain credit, and 70%of the models will not meet the conditions. If the additional battery procurement requires the effect, no model is eligible to get full credit.

According to Getejin's evaluation, the bill stipulates that a large part of eligible electric vehicles must be produced in North America. This policy is not conducive to the most effective manufacturing method and the lowest consumer price. Instead, the government tries to transfer the supply chain to the allies or return to the United States to achieve strategic goals.

Does the legislation help the Democratic Party's performance in the midterm election?

"With this bill, the American people benefit, and the special interest group lost." Bayeng said at the White House event, "People once doubted whether all this would happen, but we were in a harvest season."

At the end of last year, the negotiations of the "Reconstruction of the Better Future" broke in the Senate, and the people had a heavy questioning of the Democratic Party's legislative victory. Through a large "weight loss", the version of the "Reduction of the Inflation" was finally recognized by the Senate Democrats, and eventually passed the 51-50 votes.

With the decline in the consumer price index, economic emotions have improved in the past month. The National Independent Enterprise Federation (NFIB) said last week that its small enterprise optimism index rose 0.4 to 89.9 in July, the first month since December, but this level is still far below the average level of 48 years. About 37%of the owners still report that inflation is their most difficult problem. Gartkin said that the Democratic Party is still likely to lose the House of Representatives in the midterm elections because the ruling party usually loses seats in the midterm elections, and the Democratic Party has only five seats. The Democratic Party continued to control the probability of the two hospitals at the same time, especially considering that many foreign policy issues in Biden may still bother him again before the midterm elections.

"The bankruptcy rate is rising, the unemployment rate is also inevitable, and the environment of stagnation may continue until the midterm election. Biden will face a difficult way to re -election." Getekin said.

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