SANDRA SMITH (CO-ANCHOR): Republicans say Democrats have launched a war on the middle class with their massive social and spend plans paid for with tax hikes. And they say it will come back to bite them come the mid-term elections.
BILL HEMMER (CO-ANCHOR): So the tax man might be the biggest winner in the Democrats' deal. This as a result of the spending the IRS projected to wind up having more staffers than the State Department and the entire FBI and the U.S. Border Patrol combined. James Freeman stands by. But first, Peter Doocy live from the north lawn. And Peter, when it comes to taxes, the president will have to answer to voters. Hello to you.
PETER DOOCY (FOX CORRESPONDENT): Hello, Bill. And right now, the president is conducting official business. He's touring flood damage in Kentucky. But with this huge tax and spend bill now through the Senate, he's also got the November midterms on his mind.
DOOCY: This bill is about $740 billion and comes with new regulations aiming to reduce carbon emissions by as much as 40% by the end of this decade. New regulations that let Medicare negotiate prescription drug prices for the first time ever. And it's all paid for by giving the IRS money for 87,000 new IRS agents because Democrats calculate there's enough money out there from people doing their taxes wrong to pay for most of this, and audits could be on the way even for tax brackets the White House claims they will not raise rates on.
SMITH: Let's bring in James Freeman, Wall Street Journal assistant editorial page editor and Fox News contributor. I just want to get your reaction to the weekend. I mean, they pushed this thing through with I don't – I don't know that the White House can say any estimate that this is really going to substantially bring down inflation in any way. But still, it's somehow it's the Bring Down Inflation Act.
JAMES FREEMAN (FOX NEWS CONTRIBUTOR): Yeah, that label is what they wanted to put on this. Another big slug of climate subsidies that they've been pushing for for many years. Now, inflation is a problem. So that's the label that goes on it. Obviously, officials really struggling and senators struggling to explain how this actually reduces inflation or theoretically will reduce inflation. Even Bernie Sanders acknowledging, well, it really doesn't. This is all the climate subsidies they've wanted. By definition, it's going into inefficient energy sources or they wouldn't need subsidies. Right.
HEMMER: But the reason you have to pump up the IRS is because you have to get it through the Senate parliamentarian, right? To say that you can pay for all this stuff and it all equals out in the end. So you put all that money into the IRS and say, we're going to go out and find all this extra money from the millionaires and the billionaires out there in America who are cheating our federal government.
FREEMAN: Well, that's the claim. But of course, the millionaires in the billionaires and the largest corporations get audited a lot and have teams of lawyers to fight this stuff. Joint Tax Committee has acknowledged that the – where the money is, where the theoretical money is, is not huge corporations and not the wealthy. So to your point, obviously, this Biden pledge that I'm not going to raise anyone's taxes below $400,000 of income. You look on the corporate side, increasing corporate rate is going to be paid for in part by workers. A lot of economics to support that, including the Obama White House report on the economy, but also the IRS piece. This is a middle-class tax increase without changing the rates in theory. Now, I think what you're going to find is they actually don't find all that money, that they don't get a return on that $80 billion investment. But this is going to be a tax increase, at least in terms of hassle for people below for four hundred thousand.
SMITH: Mean, they're not even really suggesting this is going to end up with any substantial growth in this country as well. You know, some are predicting it'll actually result in job losses. This is the latest ABC poll on Americans and where they stand on the Biden economy. Those that are unhappy with the Biden economy, 29%, just 29% approve of his job, his handling on inflation. Everybody still sees the sky-high prices out there. 37% approve of Biden's job on the economy as a whole, and 69% say the economy is getting worse. I mean, that really tells you how people are at least feeling about the overall economic environment.
FREEMAN: Yeah. And you're seeing a lot of that negative sentiment in corporate forecasts among investors. The jobs report obviously is a counterweight to that. And this is how the White House has been able to say it's not a recession yet, even though it's two quarters where the economy is shrinking. But, unless we get a new inflation report where it has plunged, you're still talking about declining real wages. So even though we've gotten back to that same number of jobs pre-COVID, it's it's basically the government reducing the value of our incomes and our wealth in a very substantial way in this era of inflation.
HEMMER: We'll see how this looks on Wednesday and Thursday when we get some new inflation numbers, too.