Talking Tax Reform: Inflation, Debt, and Taxes

 

Inflation has made an unwelcome comeback, with consumer prices rising at rates not seen since 1982. Where did this inflation come from and what might its impacts be? What does inflation have to do with tax and fiscal policy and how could each be used to mitigate its negative effects?

Join the Tax Foundation Thursday, February 17th at noon ET for a two-part, hour-long webinar for answers to these questions and others.

Part I

Economist John Cochrane joins Tax Foundation’s Will McBride for a conversation on the causes of today’s inflation and the connection to fiscal and monetary policy during the pandemic and resulting increases in the national debt.

Dr. Cochrane is a Senior Fellow at Hoover Institution, research associate of the National Bureau of Economic Research, and former Professor of Finance at the University of Chicago’s Booth School of Business and its economics department. His new book on The Fiscal Theory of the Price Level provides a compelling framework for understanding today’s inflation, where it could go, and what can be done about it.

Part II

Our panelists—Marc Goldwein, Committee for a Responsible Federal Budget, and Garrett Watson, Tax Foundation—will discuss President Biden and congressional Democrats’ proposed Build Back Better (BBB) tax and spending package and its expected impacts on the debt and deficit.

Further, Marc and Garrett will explore how the tax code can be used as a tool to help temper inflation, and where it falls short.

Go Deeper

Initially thought to be “transitory” and largely the result of pandemic-related supply-chain issues, many economists at the Federal Reserve and elsewhere now see persistent inflation attributable in part to the massive monetary and fiscal stimulus issued in the wake of the pandemic.

Congress and the Trump and Biden administrations have spent over $5 trillion, or about 27 percent of GDP, on deficit-financed fiscal stimulus in the last two years—among the largest fiscal responses of any industrialized country. Another round of fiscal stimulus in the form of BBB is under consideration—the most recent House bill added $2 trillion of spending financed by a mix of tax increases and debt.

Our webinar’s panels will consider the impact of the enacted and proposed federal legislation on inflation, debt, and tax policy and explore how all three interact.

Program

Inflation and Taxes, 12:00 p.m. ET

The Next Tax and Spending Legislative Package and Impact on the Debt, 12:30 p.m. ET

  • Marc Goldwein, Senior Vice President and Senior Policy Director, Committee for a Responsible Federal Budget

  • Garrett Watson, Senior Policy Analyst, Tax Foundation