Inflation is at 40 Year High; The American Innovation and Choice Online Act Could Make it Worse
Washington, D.C. (03/11/2022) – Yesterday, the U.S. Department of Labor’s Bureau of Labor Statistics announced that inflation has risen to 7.9%, the highest inflation in 40 years.
- Wall Street Journal: Inflation Reached 7.9% in February; Consumer Prices Are the Highest in 40 Years
- Washington Post: US inflation soared 7.9% in past year, a fresh 40-year high
The new Department of Labor data demonstrates the need for deflationary practices and for Congress to support industries that provide them. Unfortunately, some members of Congress are pushing legislation that could make inflation worse – measures like the American Innovation and Choice Online Act (AICOA). This legislation targets digital goods and services that can actually be beneficial to reducing inflation.
Digital goods combat inflation in 3 ways:
- As digital goods and services are used more, consumers sometimes pay less for services than they used to. If there are price increases, they tend to happen more slowly – reducing inflation.
- Digital goods and services allow for more price transparency and make it easier for consumers to compare prices. Ensuring consumers have price transparency and the ability to compare prices increases competition – further reducing inflation.
- Digital goods and services lead to more productivity, improvements to supply chains and lower supply costs – resulting in lower prices for consumers.
“The new data released by the Department of Labor proves what Americans are feeling – costs are going up like many have never experienced before. Americans cannot hide from the rising prices and there seems to be no end in sight. Targeting American digital goods and services companies would only raise costs for consumers and we urge Congress to oppose S. 2992, which would make inflation worse,” said Chandler Smith Costello, a spokeswoman for the Don’t Break What Works Campaign, regarding the latest round of bad news regarding higher costs for consumers.
To read more about how digital goods and services have a deflationary effect, click here.
The Don’t Break What Works campaign is powered by the Computer and Communications Industry Association (CCIA). Learn more here.