U.S. Sen. John Thune (R-S.D.) today spoke about the rising costs of inflation in America and warned that Democrats’ reckless tax-and-spending spree will further increase the cost of living for the middle class through lower wages and higher taxes. Thune noted that Democrats do not have a mandate for pushing for the largest government expansion in history and urged his colleagues on the other side of the aisle to abandon this reckless spending before it ends in economic disaster.
Thune’s remarks below (as prepared for delivery):
“Mr. President, inflation is on the rise.
“Inflation in June was at its highest level in 13 years.
“And consumers are facing the effects: higher prices.
“Americans are facing increases in rent.
“In their restaurant bills.
“In their grocery bills.
“In gas prices.
“The list goes on.
“Want to buy a used car?
“Expect to pay a lot more money than you would have a year ago.
“Mr. President, inflation happens when the amount of money out there exceeds the supply of products.
“When that happens – when demand outstrips supply – prices increase.
“And that’s what we’re seeing now.
“And it’s being aggravated by Democrats’ decision this spring to flood the country with unnecessary money.
“Mr. President, during times of crisis there’s a place for increased government spending.
“The money the government invested in COVID vaccines, for example.
“The forgivable loans provided to small businesses to help them weather the pandemic.
“And the increased assistance to hospitals and health care providers as the crisis escalated.
“But crisis spending, Mr. President, is for just that: a crisis.
“Or at least it should be.
“Unfortunately Democrats have never met a temporary government dollar that they didn’t want to keep spending.
“‘Temporary’ government programs aren’t really a thing for my friends across the aisle.
“And so as the crisis was waning and our economy was rebounding, Democrats doubled down on the crisis spending and passed a massive “COVID relief” bill filled with unnecessary handouts.
“Hundreds of billions of dollars for state governments … the majority of whom were doing just fine without it.
“Tens of billions more for schools … who had barely put a dent in the billions of dollars they’d already been given.
“Republicans and at least one liberal economist warned that Democrats’ massive spending plan could overstimulate the economy.
“But Democrats didn’t listen.
“And it’s no surprise that that flood of unnecessary government dollars is currently helping to boost inflation.
“And here’s the kicker, Mr. President.
“After flooding the economy with unnecessary money, Democrats are now preparing to double down on that strategy.
“Despite passing a largely unnecessary $1.9 trillion bill just four months ago, Democrats now want to spend … an additional $3.5 trillion.
“And the truth is, that number is likely to be even higher.
“A lot higher.
“One estimate suggests that that $3.5 trillion is likely to be more like $5 trillion or $5.5 trillion.
“That’s from an independent analysis by the Committee for a Responsible Federal Budget – where President Biden’s own treasury secretary used to serve on the board.
“Mr. President, that’s an inconceivably large amount of money.
“To put that number in perspective, the entire federal budget for 2019 was less than $4.5 trillion.
“The entire federal budget.
“So Democrats are just casually tossing out a new spending bill that might very well exceed the ENTIRE federal budget for 2019.
“I can assure Americans that that much money would fuel increased inflation.
“Consumers would continue to be squeezed by rising prices … and watch the value of their salaries decrease.
“But the damage would not just be limited to the effects of inflation.
“Americans would also suffer as a result of the massive tax hikes Democrats are envisioning.
“Democrats plan to pay for all … or some … of their spending by raising taxes left and right.
“On small businesses.
“All of them, and more, will see tax increases under Democrats’ plans.
“Now, the president, of course, likes to repeat his mantra that he won’t raise taxes on those making under $400,000.
“In fact, that isn’t really true, as the president’s plans for a second death tax will undoubtedly hit middle-class Americans.
“But while it’s true that the president won’t be raising income taxes on Americans making less than $400,000, middle-class Americans will unquestionably bear a substantial part of the burden of his tax hikes.
“Because raising taxes … any taxes … has consequences. For everyone.
“Democrats like to pretend that raising taxes is a consequence-free enterprise, but that isn’t even close to being the truth.
“And it doesn’t take an economics degree to recognize that.
“It’s common sense.
“Raise taxes enough on anyone (or any business) and that individual’s behavior – or that business’s behavior – is going to change.
“A business facing a substantial tax hike may raise prices.
“It may freeze salaries.
“It may not hire as many new workers.
“And all of those decisions will be felt by ordinary Americans.
“Think about it.
“If a business raises prices to deal with the impact of a tax hike, who is going to feel it the most?
“Ordinary Americans on a budget.
“What’s more, most Americans, if they’re not self-employed or working for government, are employed by businesses.
“And if the business they work for isn’t doing well, their prospects are going to be significantly affected.
“If businesses hold down wages to deal with the impact of tax hikes, for example, ordinary Americans’ long-term earning potential will be diminished.
“These effects may not sound as concrete as being handed a tax bill.
“But they have just as real of an impact on Americans’ income and Americans’ lives.
“Studies suggest that 50 to 70 percent or more of the burden of corporate tax hikes is borne by workers in the form of things like lower wages.
“Combine Democrats’ proposed business tax hikes with their massive proposed increase in the capital gains tax – which would chill the investment that helps drive job creation – and you have a recipe for permanently diminished economic growth and a permanent reduction in opportunity for American workers.
“Mr. President, if Democrats received any mandate in the last election, it was a mandate for moderation.
“For bipartisan cooperation.
“But Democrats are behaving as if they had received a mandate for a partisan revolution.
“They’re busy driving the country down the road to socialism with a massive – and permanent – expansion in the size of government.
“And their reckless tax-and-spending spree will hurt the very Americans they claim to want to help.
“I hope some of my colleagues on the other side of the aisle will put the brakes on their party before Democrats’ massive spending spree ends in economic disaster.“Mr. President, I yield the floor.”