Representatives David Schweikert (R-AZ-06) and Byron Donalds (R-FL-19) co-sponsored H.R. 8579, the Retirement Protection Act, which would significantly raise the limits on yearly contributions to retirement plans.
Phoenix is experiencing one of the nation’s highest rates inflation annually within the continental states – topping more than 12 percentage points in June, according to the Bureau of Labor Statistics.
In a statement, Schweikert said, “This bill would play a critical role in fighting inflation while helping Americans protect their savings.”
He told The Arizona Sun Times, “It improves people’s retirement future so they stay even and don’t become a victim of inflation.”
During an appearance on Newsmax, Schweikert said, “They’re destroying, they’re just crushing the middle class. Think about this: If you’re in the Phoenix area, and you’re in that middle class working group and you haven’t had a pay raise, you’re now working a month and a half for free, because inflation is eating up so much of your paycheck.”
He explained the bill works by creating incentives for people to put their money toward their retirement instead of spending it on goods and services. It increases the yearly contribution limit for Roth and traditional IRAs by $4,000 to $10,000, and ups the workplace retirement yearly contribution limit by $4,000 to $24,500.
Schweikert, who is known as the “numbers guy” in Congress, told The Sun Times that Americans are better off while inflation is high to focus on putting money in savings and investments rather than overpaying for items. “It moves the liquidity out of society that is chasing goods, and puts it into capital stock, like productivity items,” he said. “This benefits low-income Americans as well,” he added.
Schweikert said half a dozen Democrats initially told him they would vote in favor of it. Unfortunately, he heard that Democratic leadership recently instructed them not to cooperate with Republicans until after the midterm elections. He said if Democrats supported it, they would be admitting that their last big COVID-19 stimulus spending package, the American Rescue Plan, set off inflation.
He explained how it would make the Democrats look bad during his Newsmax appearance. “When the Federal Reserve pulls out liquidity, raises interest rates, what are they doing?” he asked. “They’re trying to remove dollars that are chasing goods. Why wouldn’t Congress basically say the same thing?”
In June, the Bureau of Labor Statistics (BLS) reported a 9.1 percent annual increase in consumer prices from a year earlier, the largest yearly increase in over 40 years. Gas prices increased by a staggering 60.2 percent, energy costs went up 41.6 percent, the price of food at home increased 12.2 percent, and new vehicle prices jumped 11.4 percent.
Inflation in the greater Phoenix area surpassed the nationwide average increase, rising 12.3 percent. The increase was largely driven by gas prices, according to the BLS, which also surpassed the national average, increasing by 77 percent over the past year. Arizona is dependent on high-cost California refineries, and pollution-fighting additives pile on additional costs.
George Hammond, director of the Economic and Business Research Center at the University of Arizona, blamed rising housing costs as the main factor driving up inflation in Arizona. He said food and shelter costs are taking the biggest bite out of people’s wallets. Alaskan towns barely beat out Arizona’s increase in inflation by one-tenth of one point to make their increase the highest in the country, up 12.4 percent from a year ago.
Leading Arizona Republican officials, including Schweikert, oppose the Democrats’ federal “Inflation Reduction Act.” Described by Forbes as “a slimmed-down version of the Build Back Better bill,” it allows the government to control the price of prescription medications, contains funding for fighting climate change, would implement larger taxes for wealthy corporations, and issues the hiring of more IRS agents, among other items. Both of Arizona’s Democratic U.S. Senators, Mark Kelly and Kyrsten Sinema, support that bill.
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Rachel Alexander is a reporter at The Arizona Sun Times and The Star News Network. Follow Rachel on Twitter. Email tips to [email protected].