CNBC host Joe Kernen pressed U.S. Transportation Secretary Pete Buttigieg on the White House’s celebration of the Inflation Reduction Act as well as its rhetoric about the legislation during an interview on “Squawk Box” Friday.
Last Tuesday, the Biden administration held a celebration of the Inflation Reduction Act on White House lawn, the same day higher than expected inflation in August was announced and the Dow Jones Industrial Average had its worst day since June 2020.
“It wasn’t named the climate act, you deliberately, and some people would say erroneously, named it the Inflation Reduction Act, and you’re celebrating it on a day when, again, we had forty-year highs in inflation,” Kernen said to Buttigieg.
“And you know how that affects people on the low end of things, it’s like the most insidious problem that an economy can face,” he continued.
Buttigieg defended the legislation and attempted to portray it as an effort to bring down costs for consumers.
“The worst thing about inflation is it means people are paying too much by definition for things and what this bill does is allows people to pay less for things,” Buttigieg responded.
According to estimates by the Congressional Budget Office and the University of Pennsylvania’s Wharton Budget Model, the Inflation Reduction Act will have a negligible effect on inflation.
Buttigieg himself conceded that not everything in the Inflation Reduction Act is relevant to inflation.
“Look, we can have a whole other conversation over a drink about how bills get named, the acronyms they come up with, the names we come up with, I get it,” he said. “There are a lot of different things that are part of this bill, only some of which are related to inflation, but in my view, all of which are going to make a big, very positive, and historic difference for the American people.”
The inflation rate was 8.3 percent in August according to consumer price index data released by the Department of Labor earlier this month. Federal Reserve Chairman Jerome Powell, who was renominated for the position last year by President Biden, has stated that the Fed will raise interest rates for as long as it takes to bring down inflation, even if it means America enduring a recession.