Senate Democrats Pass Inflation Reduction Act for Health Care, Climate, Tax
After more than a year difficult and dramatic negotiationsDemocrats on Capitol Hill finally passed the sweeping climate, tax and healthcare bill on Sunday afternoon.
It’s not quite as far-reaching as most Democrats would like. What was once supposed to be a $5 trillion bill — and then $3.5 trillion, then $3 trillion, then $1.5 trillion, and then $1 trillion billion dollars – eventually became a $400 billion metric, spread over the next 10 years, that actually reduced the deficit by more than $300 billion over that period by closing the tax loopholes.
That’s hardly the package that President Joe Biden and the vast majority of Democrats are aiming for, but it’s the Sens package. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ) will let them have. And even as Democrats had hoped for more, they were delighted to end one of the best weeks of Biden’s term with the passage of the legislation.
“After more than a year of hard work, the Senate is making history,” said Senate Majority Leader Chuck Schumer (D-NY) shortly before the bill passed. “This bill will kickstart the era of affordable clean energy in the US, it’s a game changer, it’s a turning point and far from coming.”
The Senate passed the bill Sunday afternoon 51-50, with all Democrats voting for the bill and all Republicans voting against it. Vice President Kamala Harris broke the tie and passed the bill thanks to a legislative process known as mediation, which removes the Senate’s 60-vote threshold for bills that meet certain conditions.
The legislation is now heading to the US House of Representatives, where there is no serious concern that a Democratic majority there will sink the bill that eventually received unanimous Democratic support in the Senate.
“Today, Senate Democrats sided with special interests American families, voting to reduce prescription drug costs, health insurance and daily energy costs, and reduce the deficit, while making the wealthiest corporations ultimately pay their fair share,” President Joe Biden said in a statement. “I’m running for President promising to get government working again for working families, and that’s what this bill does — phase.”
To reflect their biggest political challenge right now, Democrats have dubbed the bill the “Inflation Reduction Act,” which encompasses a range of different policy priorities on transforming climate, health care and tax reform.
The bill passed after a nearly 16-hour debate on the amendments — known as a “vote” — that saw senators from both sides of the aisle introduce various changes to the bill. wide-ranging legislation, with Republicans hoping to jointly amend it. .
The process has not been without barriers for Democrats, some from their own party. Senator Bernie Sanders, an independent who met behind closed doors with Democrats and has criticized the bill for not being broad enough, has proposed amendments that seek to restore elements of the “Build Back Good” plan. more” initially (and costly), such as the child tax that extends the credit. Like many other measures, this one has failed – with Sanders often the only vote.
Sinema took issue with a 15 percent minimum tax on business that would include private equity firms, and an amendment proposed by Senate Minority Whip John Thune (R-SD) was finally approved. passed an exemption from private equity firms.
After a brief period of nail-biting, an agreement was finally reached to fund that fix through an expansion of the loss-carrying limit, allowing individuals to report business losses on individual tax returns. their. That amendment, proposed by Senator Mark Warner (D-NC), passed and omitted the Thune amendment, clearing the way for the overall bill.
However, Republicans still find ways to respond. An amendment to cap insulin funding at $35 for private insurance was opposed by Republicans, even as some participating Democrats voted for it. Instead, the $35 limit will only go to people receiving Medicare.
Biden and the Democrats spent much of 2021 trying to get the trillion-dollar Build Back Better package to the finish line. But Manchin is reluctant to spend such a sum amid rising inflation – and opposition to many key climate measures – while Sinema has killed off proposals to raise money to pay bills by modifying the code. tax numbers are structured to benefit Wall Street and large businesses.
As the November midterm elections approach, most observers say the chances of Democrats using the mediation process to pass a party line bill have essentially disappeared. But Manchin shocked the Capitol in late July, when he and Majority Leader Chuck Schumer (D-NY) announced that they had reached an agreement on the bill’s broad outlines.
Although much smaller than Build Back Better, the legislation contains proposals that most Democrats consider a huge accomplishment.
It spends $300 billion on climate change measures that aim to cut US greenhouse gas emissions by 40% by 2030, which Democrats almost see as a victory. great. It contained one of the party’s long-awaited reforms: allowing Medicare to negotiate lower prescription drug prices. And it also sets a minimum tax rate on corporations of 15%, which could raise hundreds of billions of dollars to pay for the programs in the bill and pay the deficit.
Republicans have sought to drop the bill as a tax and spending circumvention that could hamper the economy as it works to weather crushing inflation and two consecutive quarters of negative growth. Some initial analysis has shown it may have a negligible effect on inflation—Decreased both Democrats’ branding for the bill and some criticism of the GOP.
The GOP also argued that the bill would break Biden’s pledge not to raise taxes on people earning less than $400,000 a year. The initial analysis of this particular point was incomplete, Bloomberg reported.
“Democrats want to pass massive, job-killing tax increases in the midst of the recession they’ve created,” Senate Minority Leader Mitch McConnell (R-KY) argued last week.
Predictably, Sinema became the last hurdle, and spent a week publicly silent about the bill while addressing objections that were subsequently leaked to the press. In the end, the Arizona senator extracted her concessions — including eliminating the tax loophole in favor of big finances — and allowed her to sign the bill.
Progressives, eager to leverage the Democratic Party’s unified control of Washington to finally overcome long-awaited priorities were disappointed. Before the Senate passed the bill, Senator Bernie Sanders (I-VT) called it an “extremely modest” piece of legislation.
“We are living in a time of unprecedented crisis,” Sanders said. “This bill does almost nothing to solve any of them.”
Still, the Senate’s passage of the bill unmasked one of Biden’s best periods in his nearly two years in office.
Over the past 10 days, Biden has seen the House and Senate pass a high-tech manufacturing measure, Manchin reached an agreement with Schumer on a reconciliation bill, Republicans enthusiastically voted to repeal the bill. for veterans (only then reversed themselves and passed the law when they realized their political mistake), gasoline prices dropped over the summer, the US military took down a top Al Qaeda leader, appointed The vote gave Democrats new hope by completely and surprisingly rejecting the abortion ban in Kansas, a low 50-year equivalent unemployment rate, and the US report that more than 500,000 jobs jobs were added in July – a strong sign that the economy is not in recession.