Bill Overview
Title: Inflation Prevention Act
Description: This bill establishes a point of order that, when the annualized rate of inflation exceeds 4.5%, prohibits the Senate from considering legislation that provides new budget authority and is estimated to result in an increase to the rate of inflation. The prohibition may be waived by an affirmative vote of three-fifths of the Senate.
Sponsors: Sen. Scott, Tim [R-SC]
Target Audience
Population: People affected by inflation worldwide
Estimated Size: 330000000
- This bill aims to address inflation by setting a legislative barrier against passing budget authority that could increase the inflation rate when it is above 4.5%.
- Inflation affects everyone as it decreases the purchasing power of money, leading to higher costs of goods and services.
- Individuals on fixed or low incomes are disproportionately affected by inflation since their purchasing power is more sensitive to price changes.
- The bill also has indirect impacts on businesses and industries since inflation control measures can influence economic growth, borrowing costs, and investment decisions.
Reasoning
- The policy is designed to prevent the passage of new budgetary legislation that may worsen inflation during periods of high inflation. This does not require direct budget spending but is a legislative strategy, meaning no direct financial outlay impacts government's budget ratio.
- This bill can impact everyone indirectly by influencing the overall economic environment. It is particularly impactful during periods of high inflation, by potentially restricting fiscal policy actions that might otherwise be used to stimulate economic activity.
- Real-life effects of inflation vary widely among different demographics. People on fixed incomes, like retirees, or those in low-wage jobs are more financially vulnerable to inflationary pressures, while those with higher incomes might be less directly affected but still experience increased costs.
- The policy's preventive nature can affect individuals' and businesses' expectations and decision-making processes about future economic conditions. This can influence consumer behavior, savings rates, and investment.
- Simulated interviews will capture a variety of perspectives, including those with high exposure to inflationary pressures and those for whom the policy might result in little to no perceived impact.
Simulated Interviews
Retired school teacher (Phoenix, AZ)
Age: 67 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- I am worried about inflation because my pension doesn't increase with the cost of living.
- I think this policy could help to manage inflation better, making my savings go further.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 4 |
| Year 5 | 8 | 4 |
| Year 10 | 7 | 3 |
| Year 20 | 6 | 3 |
Factory Worker (Detroit, MI)
Age: 45 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- Inflation has made it tough to buy groceries and pay rent.
- I hope this policy will help keep prices from rising so fast.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 6 | 3 |
| Year 10 | 7 | 3 |
| Year 20 | 7 | 3 |
Software Engineer (Boston, MA)
Age: 30 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 3.0 years
Commonness: 5/20
Statement of Opinion:
- Inflation is annoying but I can manage.
- This policy seems to address the root issue, but doesn't personally affect me much.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Graduate Student (San Francisco, CA)
Age: 25 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 7.0 years
Commonness: 6/20
Statement of Opinion:
- Rising costs make my budget really tight.
- If this stops further price hikes, it'll be a relief.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 5 | 4 |
| Year 5 | 6 | 4 |
| Year 10 | 6 | 3 |
| Year 20 | 5 | 3 |
Small Business Owner (Austin, TX)
Age: 52 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 8.0 years
Commonness: 5/20
Statement of Opinion:
- Inflation affects my business costs and pricing directly.
- A positive impact would be stabilization for business planning.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 4 |
| Year 10 | 8 | 3 |
| Year 20 | 7 | 3 |
Financial Analyst (New York, NY)
Age: 39 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 4/20
Statement of Opinion:
- Inflation trends affect my investment decisions.
- This policy could prevent worse scenarios in my field.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Logistics Manager (Columbus, OH)
Age: 60 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- I'm concerned about my retirement savings and living costs.
- The policy could mean a more stable financial environment post-retirement.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 4 |
| Year 10 | 7 | 4 |
| Year 20 | 6 | 3 |
Nurse (Seattle, WA)
Age: 28 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- Everything is getting pricier but my salary isn't.
- The potential to curb inflation could make pay go further.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 4 |
| Year 10 | 7 | 3 |
| Year 20 | 7 | 3 |
Retired banker (Tampa, FL)
Age: 75 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 4/20
Statement of Opinion:
- I am less concerned about day-to-day inflation issues.
- I think ensuring stability is crucial for economic forecasts.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Oil Industry Worker (Houston, TX)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 4.0 years
Commonness: 5/20
Statement of Opinion:
- Inflation is a concern but our industry fluctuates naturally.
- If the policy helps stabilize economic conditions, I'm for it.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 4 |
Cost Estimates
Year 1: $0 (Low: $0, High: $0)
Year 2: $0 (Low: $0, High: $0)
Year 3: $0 (Low: $0, High: $0)
Year 5: $0 (Low: $0, High: $0)
Year 10: $0 (Low: $0, High: $0)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The Inflation Prevention Act operates as a legislative rule, not a typical budgetary policy, focusing on correcting inflation through limitation of expansionary fiscal policies.
- The potential savings and GDP impact are highly speculative and dependent upon the economic circumstances during periods of high inflation.