system
Given the following post, respond as if you're commenting on Reddit:
human
Will Build Back Better add to inflationary pressures?

I read that some believe the >$1trillion spending package won’t add to inflation. I was wondering how we can know that? What does add to inflation?

My thought is: if we take money from people/companies not using as much of it (via higher taxes) and spend it on infrastructure where much of it goes into raw materials and worker pay (who are more likely to use it), it seems like it should put more pressure on inflation? Especially in such huge volumes of money.

So, does it seem like it would be more or less likely to put additional pressure on inflation?
gpt
It's not a matter of BBB not adding inflationary pressure all together, it's more a matter of scale. In this case, if the current 1.5 Trillion dollar plan is passed, that would represent 150 billion/year in new spending, or a bit over 0.5% of the GDP on these social programs. They could have a broader effect than those simple numbers, but it's not likely that it will significantly add to inflation. 

It's important to keep in mind that the bulk of the inflation we're seeing now is a result of supply chain constraints being tested and not the monetary/fiscal policies of governments, and we likely wouldn't be considering the potential for inflationary pressure for such a bill in most other contexts.