Journal Article

Policy Update: Understanding the Inflation Reduction Act

Abstract: In August, President Biden signed into law a spending, revenue, and deficit reduction bill titled the Inflation Reduction Act (IRA). Born out of the never-enacted Build Back Better Act, a $1.8 trillion stimulus and revenue package proposed at the beginning of the Biden administration, the IRA is the result of extended negotiations that changed the bill from a broad social and economic stimulus bill into one focused on clean energy, health care, and deficit reduction. These changes secured the final votes needed to pass the legislation on a party-line basis. It represents one of the largest legislative efforts to reduce the deficit in recent years and has been touted by the administration as an important tool to help bring down inflation.

Keywords: Inflation Reduction Act; Medicare; Climate Change Policy;

Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Econ Focus

Publication Date: 2022

Volume: 22

Issue: 4Q

Pages: 17