McConnell warns Democratic tax deal will ‘kill many thousands of American jobs’

Senate Republican Leader Mitch McConnell (R-Ky.) slammed Senate Democrats for reaching a deal Wednesday to reform the tax code, warning it would “hammer workers and kill many thousands of American jobs.”   

He issued his statement in response to a deal announced by Senate Majority Leader Charles Schumer (D-N.Y.) and Sen. Joe Manchin (D-W.Va.) that would raise $451 billion in tax revenue by setting a 15 percent corporate minimum tax, beefing up IRS enforcement of tax compliance, and closing the carried interest loophole on asset managers.  

“Democrats have already crushed American families with historic inflation. Now they want to pile on giant tax hikes that will hammer workers and kill many thousands of American jobs,” McConnell tweeted. “First they kill your family’s budget. Now they want to kill your job too.”  

McConnell was one of several Republicans to condemn the deal.  

Sen. Lindsey Graham (R-S.C.), the ranking member of the Budget Committee, took aim at Manchin and declared the deal made “no sense.”  

“I can’t believe that Sen. Manchin is agreeing to a massive tax increase in the name of climate change when our economy is in a recession,” he said.  

“This Democratic power grab through reconciliation will make every economic problem in America worse,” he added, referring to the budget process by which Democrats can pass the bill with a simple-majority vote, circumventing a filibuster.  

Sen. John Cornyn’s (R-Texas) office said Manchin “flip-flopped” on passing a major tax reform bill under the budget reconciliation process.  

“Senate Democrats can change the name of Build Back Broke as many times as they want, it won’t be any less devastating to American families and small businesses,” he said, using the GOP moniker for Biden’s spending plan. “Raising taxes on job creators, crushing energy producers with new regulations, and stifling innovators looking for new cures will only make this recession worse, not better.” 

The GOP senators issued their statements a few hours after Federal Reserve Chairman Jerome Powell said he does not think the U.S. economy is currently in a recession.  

“The reason is there are too many areas of the economy that are performing too well,” he said at a press conference.  

The Schumer-Manchin deal, dubbed the Inflation Reduction Act of 2022, would raise $739 billion in revenue.  

In addition to the tax provisions, it would raise $288 billion from empowering Medicare to negotiate lower prescription drug prices. 

It would spend $369 billion on energy security and climate change programs and $64 billion to extend Affordable Care Act health insurance subsidies for three years through 2025.  

It would allocate more than $300 billion to reducing the deficit.  

President Biden highlighted the impact on the deficit in a statement Wednesday afternoon.  

“This bill will reduce the deficit beyond the record setting $1.7 trillion in deficit reduction we have already achieved this year, which will help fight inflation as well,” Biden said in a statement.  

The deficit has fallen this year as spending on COVID-relief programs has fallen.