4 ways House Republicans want to reshape the US economy in 2023

The introduction of the House Republicans’ Commitment to America this week was a deliberate reminder of its famous predecessor, the 1994 Contract with America.

Back then, on September 27, 1994, Newt Gingrich, who would later become Speaker of the House, stood alongside other Republicans and outlined his promises. While Gingrich’s proposal comprised a 196-page book containing 10 specific bills, this week’s effort offered vague fare, fitting on a single page.

Nonetheless, it is a glimpse into Republican plans if they retake at least one chamber of Congress, some pundits are predicting. So far, Republicans have focused heavily on major policy issues like immigration, crime and education, but this week’s introduction also includes hints at economic plans.

“What the commitment is is a plan, a plan for a new direction,” House Minority Speaker Kevin McCarthy said during a Republican rally Friday along with his peers in Monongahela, Pennsylvania. “It’s about you, it’s not about us.”

House Republicans unveil their commitment to America.  Image: Youtube

House Republicans unveil their commitment to America. Image: Youtube

Here are four key economic takeaways from this week’s unveiling that relate to blaming Democrats for high inflation; increasing fossil fuel production; China; and whether Republicans will change the “third rail” of Medicare and Social Security.

Inflation, inflation, inflation

Inflation remains the top GOP news.

At Friday’s event in Pennsylvania, McCarthy focused on the US bailout plan passed last year as the main driver of inflation. “These Democratic policies have already cost a month of your salary,” he said, before pledging to repeal the newly passed inflation-cutting law once Republicans take control.

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Republicans have long blamed Washington spending for inflation, while most economists point to a broader range of factors behind persistently high prices. Still, many experts see last year’s American Rescue Plan – which brought direct relief to Americans – as a key reason for skyrocketing prices. Meanwhile, the Inflation Reduction Act is unlikely to affect prices, despite its name, according to a widely cited study by the University of Pennsylvania Business School.

In reality, Republicans would have a hard time overturning the anti-inflation bill, especially since Biden would certainly veto any bill to reverse his signature effort aimed at fighting climate change, reforming health care and the to support the Internal Revenue Service.

Republicans are also promising new “pro-growth tax and deregulation policies” to fight inflation, with Rep. Patrick McHenry, who would lead the House Financial Services Committee, saying “the most important thing is to stop digging the ditch” if it’s about fighting inflation. The second priority? Keep an eye on the Biden administration.

An upcoming election debate about Medicare and Social Security

Entitlement earned just a single line in this week’s schedule and didn’t show up at all during Friday’s event, but they’ll likely be the center of attention this fall as a central topic of conversation.

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House Republicans this week pledged to “save and strengthen Social Security and Medicare.” They offered no further details, but the mere mention of the two programs sparks a fight with eager Democrats.

Biden’s party has focused on those claims since Republican Senate campaign chair Rick Scott released a plan in February that would require Congress to review “all federal laws” — including Social Security and Medicare — every five years. GOP candidates in the US have also proposed privatizing Medicare.

“The difference with older voters couldn’t be greater,” Democratic Congressional Campaign Committee Chairman Sean Patrick Maloney (DN.Y.) said Thursday. “Your choice is between a party that says we can take your Social Security and Medicare away from you every five years.”

Biden will also revisit the issue next Tuesday with a trip to Florida — a key swing state home to many older voters — to deliver a speech on cutting health care costs and strengthening Medicare and Social Security.

U.S. President Joe Biden gives a thumbs up as he boards Air Force One at John F. Kennedy International Airport September 22, 2022 as he returns to Washington, DC.  (Photo by MANDEL NGAN/AFP) (Photo by MANDEL NGAN/AFP via Getty Images)

President Biden will board Air Force One after a trip to New York on Thursday. (MANDEL NGAN/AFP via Getty Images)

A focus on fossil fuel production

The GOP also signaled a focus on increasing fossil fuel production in 2023 with promises to “maximize production of reliable, American-made energy” and “halve the length of the permitting process to reduce reliance on foreign power outages.” to prevent and reduce the cost of gas and utilities.”

On Friday, Republican whip of the House Steve Scalise said he was determined to send a bill to Biden’s desk to cut energy prices. “We will give him this dilemma; we will give him a chance to wake up,” he promised.

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Still, Sen. Joe Manchin (D-WV), a close energy industry ally, is pushing ahead with his own efforts to reform the energy permitting process. While Republicans normally tend to support energy reform efforts, many have opposed Manchin’s proposal ahead of a likely vote next week alongside the Liberal Democrats.

MIDLAND, TEXAS - MARCH 13: An oil rig erected in the Permian Basin oil field on March 13, 2022 in Midland, Texas.  US President Joe Biden imposed a ban on Russian oil, the world's third-biggest oil producer, which could mean Permian oil producers have to pump more oil to meet demand.  The Permian Basin is the largest petroleum producing basin in the United States.  (Photo by Joe Raedle/Getty Images)

An oil rig in Midland, Texas seen earlier this year. (Joe Raedle/Getty Images)

Supply chains and China

Republicans also plan to attack China next year.

“China has too much control over our supply chain; we’re going to bring that back to America,” McCarthy said. In a comment this week, he added that the GOP plan “modernizes outdated regulations to expand American manufacturing, strengthen our supply chain, and end our reliance on China for critical goods.”

Republican leaders have reportedly conducted polls showing that 23% of independents identified China as their “main issue.” However, details of a possible bill are sparse. Legislators have recently launched a bipartisan effort on supply chains – mainly related to medical supplies – without yet agreeing on a full-scale bill.

Also on Friday, House GOP leaders pledged to hold hearings on the origin of COVID and China’s role in the pandemic if they can take control and set the agenda next year.

Republican leader of the House of Representatives Newt Gingrich opens a ceremony in front of Capitol Hill on September 27, 1994.  About 300 Republican incumbents and challengers signed a binding treaty with the American people that contained a 10-point reform program that a Republican majority would attempt to pass in the first 100 days of the 104th Congress.  REUTERS/Ira Black

Then-Republican leader of the House of Representatives Newt Gingrich during a September 27, 1994 ceremony with some 300 Republicans to propagate the “Treaty with America.” (REUTERS/Ira Schwarz)

Ben Vershkul is the Washington correspondent for Yahoo Finance.

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