President Biden’s Build Back Better agenda called for a number of reforms that were not included in the Democrats’ Inflation Reduction Act.
Evan Vucci / AP
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Evan Vucci / AP
President Biden’s Build Back Better agenda called for a number of reforms that were not included in the Democrats’ Inflation Reduction Act.
Evan Vucci / AP
Late Saturday night and into Sunday morning, Senators voted on amendments to a major Democratic spending bill that covers health care, climate and taxes.
The bill is being passed the budget adjustment process, which means all 50 Democrats and one dissenting vote from Vice President Harris, as none of the 50 Republican senators will vote on the bill. It also restricts measures in the bill to those that directly change federal spending and income.
Majority Leader Chuck Schumer, DN.Y., said Saturday that despite some cuts from the Senate, the bill overall was still a legislative victory for Democrats.
Democrats argued that it would address voters’ primary economic concerns, naming it the Inflation Reduction Act. Republicans say the new spending will exacerbate inflation. However, the nonpartisan Congressional Budget Office said the bill had a “negligible” effect on inflation in 2022 and 2023.
Overall, the bill is a microcosm of what many Democrats, including President Biden, originally requested.
“This bill is far from perfect. It’s a compromise. But it’s often how progress is made,” Biden said. speak at the White House last month. “My message to Congress is: This is the strongest bill you can pass.”
Once passed in the Senate, the House plans to consider the bill over the weekend and then send it to President Biden for signature.
Here are some of the things that were included in the Democrats’ bill and what weren’t.
You can view the full 755-page bill here.
Coping with climate change
More than $300 billion will be invested in energy and climate reform, biggest federal clean energy investment in US history.
The bill has support from many environmental and climate activists but falls short of the $555 billion that Democrats initially called for.
This part of the bill covers transportation and electricity generation, and it includes $60 billion to develop renewable energy infrastructure in manufacturing such as solar panels and wind turbines.
It also includes some tax credits for individuals on things like electric cars and making homes more energy efficient.
According to Democrats, the bill would reduce greenhouse gas emissions by 40%, based on 2005 levels, by the end of the decade. 50% of Biden originally targeted.
“It puts us close enough that further regulatory action, the efforts of local and state governments, and private sector leadership can get us there by 2030.” Jesse Jenkins says from Princeton University, who leads Project REPEAT analyzing the impact of government climate actions.
Reduce prescription drug costs
Regarding health care reform, the bill would make prescription drugs more affordable – but with some limits.
The bill includes a historic measure that would allow the federal health minister negotiate the cost of some expensive drugs annually to Medicare.
But this won’t affect every prescription or every patient, and it won’t take effect quickly. The negotiations will go into effect for 10 drugs covered by Medicare by 2026, increasing to 20 drugs by 2029.
The part of the bill that tries to cap the price of insulin at $35 per month – a drug that is extremely expensive in the US compared to other countries – was rejected by the Senate congressman, leaving it out of their reach. as it would need 60 votes to pass as a common law.
The congressman also ruled that a measure in the bill to force drug companies to lower prices if prescription prices are higher than inflation is not entirely consistent with the budget adjustment rules; She said it may apply to Medicare patients but not to patients with private insurance companies.
The bill places a $2,000 cap on out-of-pocket prescription drug costs for people on Medicare, effective in 2025.
There is also a three-year extension to the health care allowance in Affordable Care Act Originally passed in a pandemic relief bill last year, the government is estimated to have kept premiums at $10 a month or less for the majority of those insured through the exchange. federal health insurance service.
That helps millions of Americans avoid a spike in their health care costs.
Rent reform
The law creates a 15% minimum tax rate for companies with $1 billion in income or more, bringing in more than $300 billion in revenue.
However, the part that is cut is the part that shrinks real interest rate tax loopholes. Arizona Kyrsten Sinema has agreed to sign the bill if the measure, which has changed the way private equity income is taxed, is cut. Democrats say it will bring in $14 billion in revenue.
Instead, a 1% excise tax on share buybacks has been introduced, and it can bring in nearly 5 times more revenue than interest is calculated. However, it won’t take effect until next year, sparking anticipation of some massive corporate acquisitions before 2023.
A major part of the bill that was not included, due to objections from West Virginia Senator Joe Manchin, was to extend the Child Tax Credit. Last year, Manchin expressed that the cost to extend the credit was too high, but progressives, including Vermont Senator Bernie Sanders, have continued to push for its inclusion in the bill.
Sanders planned to add it as an amendment to the law during an all-night voting process, even without the support he needed to pass it.
