Economist Peter Schiff said Republicans who brag about no tax on tips, overtime or Social Security “must also accept responsibility for higher inflation, as that was the trade-off.”
Schiff wrote in a post on X on Monday: “Because government spending actually rose as those tax cuts were enacted, the lost revenue means the tax cuts are paid for through higher inflation. So workers get to keep more of the money they earn, but its purchasing power is reduced by the higher prices that are a direct consequence of the tax cuts.”
Replies on Tips, Gold
One user replied that “no tax on tips basically did very little to cause inflation.” Schiff responded: “Wrong, it means people who earn tips have more money to spend, which bids up prices. You have more demand without a commensurate increase in supply.”
Another user asked whether inflation pressure would lead to higher gold prices, writing that gold “has become a risk asset.” Schiff replied that it would in the long run, adding: “In the short run it led to higher interest rates.”
Schiff, Massie on Spending
In a previous post on X, Schiff had argued that the Big Beautiful Bill made the federal government “bigger and more expensive than ever” and that the burden on the public “will more than offset those fake tax cuts.” Rep. Thomas Massie (R-Ky.) had written in a post that “ALL government spending is paid for by citizens, through taxes, inflation, interest, AND debt (deferred tax),” adding that the bill increased spending by hundreds of billions of dollars over the next few years.
Wolfers on Deficit
Treasury data shows the U.S. ran a $1.992 trillion deficit in fiscal 2026, with net interest of $1.052 trillion, more than the $965 billion spent on defense. In a separate interview with MS Now, economist Justin Wolfers said the U.S. is running its largest deficit outside a recession or war, adding that Washington will “cut benefits for people who need them, cut taxes for people who do not, and borrow the difference.”
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
