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Dems' climate, energy, tax bill clears initial Senate hurdle
By Prathapan Bhaskaran - Aug 07, 2022, 02:41 AM ET
Last Updated - Jul 18, 2023, 04:36 PM EDT
VP Kamala Harris’ vote broke the tie as Republicans opposed President Joe Biden’s proposals on climate, energy, health and taxes
Democrats pushed their
election-year economic bill toward Senate approval early Sunday, aiming President Joe Biden's priorities on climate, energy,
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health and taxes to a pathway that the party hopes will end in final
congressional passage by the end of this week.
The evenly divided Senate voted
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Saturday to begin debating the legislation 51-50, with Vice President Kamala
Harris breaking the tie and overcoming unanimous Republican opposition. A dwindled
version of earlier multitrillion-dollar measures that Democrats failed to
advance, the package has become a partisan battleground over inflation,
gasoline prices and other issues that polls show are driving voters, an AP report said.
Fighting climate change
The House, where Democrats have a
slender majority, could give the legislation final approval next Friday.
"The time is now to move
forward with a big, bold package for the American people," said Senate
Majority Leader Chuck Schumer, D-N.Y. "This historic bill will reduce
inflation, lower costs, fight climate change. It's time to move this nation
forward."
Republicans said the
measure would damage the economy and make it harder for people to cope with
sky-high inflation. They said the bill's business taxes would hurt job creation
and force prices upward and urged voters to remember that in November.
"The best way to stop this tax
and spend inflationary madness is to fire some of the 50 so they can't keep
doing this to your family," said South Carolina Sen. Lindsey Graham, top
Republican on the Senate Budget Committee. said AP.
Pharmaceutical costs
Nonpartisan analysts have said the
legislation, which Democrats have named the Inflation Reduction Act, would have
minor impact on the nation's worst inflation bout in four decades. Even so,
it would take aim at issues the party has longed to address for years including
global warming, pharmaceutical costs and taxing immense corporations.
Before reaching final passage,
senators plodded through a nonstop pile of amendments called a
"vote-a-rama" that seemed certain to last hours.
In early votes, the chamber
rejected an effort by progressive Sen. Bernie Sanders, I-Vt., to require
Medicare to pay the same lower prescription drug prices paid by the Department
of Veterans Affairs.
Another, by Graham, was defeated;
it would have erased a fee Democrats want to renew on barrels of oil that
raises money for hazardous waste cleanups. Republicans said Democrats' proposal
would boost gasoline prices, a sore point for voters after this summer's record
pump prices.
Significant part dropped
Earlier, the Senate parliamentarian
gave a thumbs-up to most of Democrats' revised 755-page bill. But Elizabeth
MacDonough, the chamber's nonpartisan rules arbiter, said Democrats had to drop
a significant part of its plan for curbing drug prices.
MacDonough said Democrats violated
Senate budget rules with language imposing hefty
penalties on pharmaceutical companies that boost prices beyond inflation
for drugs sold in the private insurance market. Those were the bill's chief
drug pricing protections for the roughly 180 million people whose health
coverage comes from private insurance, either through work or bought on their
own.
Other pharmaceutical provisions
were left intact, including giving Medicare the power to negotiate what it pays
for drugs for its 64 million elderly recipients, a longtime Democratic
aspiration. Penalties on manufacturers for exceeding inflation would apply to
drugs sold to Medicare, and there is a $2,000 annual out-of-pocket cap on drug
costs and free vaccines for Medicare beneficiaries.
Democrats are using special
procedures that would let them pass the measure without having to reach the
60-vote majority that legislation often needs in the Senate. To do that, they
must abide by rules that include a requirement that provisions be chiefly aimed
at affecting the federal budget, not imposing new policy.
Rapid-fire deals
The weekend debate capped a
startling 10-day turnabout that saw Democrats resurrect
top components of Biden's agenda that had seemed dead. In rapid-fire deals
with Democrats' two most unpredictable senators — first conservative Joe
Manchin of West Virginia, then Arizona centrist Kyrsten Sinema — Schumer pieced
together a package that would give the party an achievement against the
backdrop of this fall's congressional elections.
The measure is a shadow of Biden's
initial 10-year, $3.5 trillion proposal, which funded a rainbow of progressive
dreams including paid family leave, universal preschool, child care and bigger
tax breaks for families with children. The current
bill, barely over one-tenth that size, became much narrower as Democratic
leaders sought to win the votes of the centrists Manchin and Sinema, yet it has
unified a party eager to declare victory and show voters they are addressing
their problems.
The bill offers spending and tax incentives
favored by progressives for buying electric vehicles and making buildings more
energy efficient. But in a bow to Manchin, whose state is a leading fossil fuel
producer, there is also money to reduce coal plant carbon emissions and
language requiring the government to open more federal land and waters to oil
drilling.
Expiring subsidies that help
millions of people afford private insurance premiums would be extended for
three years, and there is $4 billion to help Western states combat drought. A
new provision would create a $35 monthly cap for insulin, the expensive
diabetes medication, for Medicare and private insurance patients starting next
year. It seemed possible that language could be weakened or removed during
debate.
Call for tax equity
Reflecting Democrats' calls for tax
equity, there
would be a new 15% minimum tax on some corporations with annual profits
exceeding $1 billion but that pay well below the 21% corporate tax. Companies
buying back their own stock would be taxed 1% for those transactions, swapped
in after Sinema refused to support higher taxes on hedge fund managers. The IRS
budget would be pumped up to strengthen its tax collections.
While the bill's final costs were
still being determined, it would spend close to $400 billion over 10 years to slow
climate change, which analysts say would be the country's largest investment in
that effort, and billions more on health care. It would raise more than $700
billion in taxes and from government drug cost savings, leaving about $300
billion for deficit reduction over the coming decade — a blip compared to that
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