So let me get this right. We are in a recession, and the recession is accompanied by high inflation. Milton Friedman used to call that inflationary recession, and we are unfortunately going to be afflicted by this discouraging condition for quite some time.  

So, the Biden Democrats have put together a new fiscal deal which will raise taxes by $739 billion, designed to make the recession worse. And $433 billion in additional spending designed to make the inflation higher. So naturally this dreadful bill is being called the “Inflation Reduction Act of 2022.”  

George Orwell would be proud. I would call it the “Stagflationary Malaise Act.” Oh, and by the way, I guess some Democrats believe inflation would come down because in their fantasy world the tax hikes exceed the spending increases for a $300 billion deficit reduction.  

Wait a minute, what happened to the $284 billion Chips+ semiconductor corporate welfare bailout bill that just passed? That wipes out the phony deficit reduction.  

Hang on another second. Obamacare subsidies that are in the Schumer-Manchin bill actually come in at $220 billion over 10 years, according to the CBO. That adds another $150 billion. So, in the blink of an eye, the last 48 hours, all these rabid anti-inflationists in Washington have just increased federal spending by roughly $870 billion.

Is that not inflationary?  

How on Earth Joe Manchin could be signing on to these outrageous spending bills is beyond me. I don’t get it. He has broken my heart. We are not going steady anymore. I’m giving him back his fraternity pin.  

One more word about the tax hike. The 15 percent corporate minimum tax is really a killer, because it’s done on the basis of book profits, which means no legal credits and deductions that are used in IRS profits can be applied.  

The biggest piece is excluding the 100 percent immediate expensing of plants and equipment, which was a major part of the Trump corporate tax cuts. 

Business investment fell almost 3 percent in the Second Quarter GDP report, and business plants and structures fell 12 percent. So this 15 percent minimum tax is going to make things much worse. And remember, 70 percent of the corporate tax burden falls on middle income working folks, blue collar folks, typical families.  

So this Schumer-Manchin idea will lead to even deeper drops in real wages and family income. That’s how dumb this is.  

Finally, I grow weary of the semantic debate about recession. Two straight declining quarters is a good enough working definition of recession. Fox News’ Peter Doocy has this exchange in the White House press room:  

“You said in 2008, ‘Of course, economists have a technical definition of a recession, which is two consecutive quarters of negative quarters of growth.’ Yesterday you said that two negative quarters of GDP growth is not the technical definition of a recession.”

“It is not, it is not,” Mr. Biden’s press secretary said.

Today’s second straight contraction in GDP shows plunging housing, along with collapsing business investment, along with an 8.9 percent inflation rate. Every piece of it was worse than the contraction in first quarter GDP.  

And people who think that the Fed is going to give up its tight money policies because of recession should think twice about that erroneous assumption.  

Stock markets are you listening?  

Make no mistake, the woke economists in the Biden Administration don’t care one whit about growth. They’re only interested in income redistribution. They’re waging war against all business and fossil fuels. They believe all profits are excessive and should be taxed more. 

All of their economic policy thinking is based on radical climate activism. Whose disastrous consequences have given us sky-high inflation, oil prices, gas prices, grocery prices, and the price of everything else.  

This is modern socialism through the regulatory planning state. Noblest Friedrich Hayek called it the road to serfdom. I think big government socialism captures it all.  

In 18 months these woke policies have destroyed a successful economy. In the last 48 hours, they’re giving us more of the same. It’s an absolute outrage. We need to throw this crowd out and replace them with supply-side policies of tax cuts and deregulation to rejuvenate the economy and the American spirit.  

The only thing good I can say tonight is the cavalry’s coming.

From Mr. Kudlow’s broadcast on Fox Business News.