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Climate and tax legislation deletes test vote in the Senate

Written by Javed Iqbal

WASHINGTON – A divided Senate on Saturday took a decisive step toward approving Democrats’ plan to tackle climate change, cut health care costs and raise taxes on big business with a test vote that paved the way for passage of a significant portion of President Biden’s home state. agenda in the coming days.

The measure advanced on a party-line vote of 51 to 50, with all Republicans opposed and Vice President Kamala Harris breaking the tie.

The move signaled that Democrats, after more than a year of infighting and careful negotiations, had finally coalesced behind legislation that would provide hundreds of billions of dollars for climate and energy programs, expand subsidies for the Affordable Care Act and create a new federal initiative to reduce prescription drug costs, especially for older Americans.

A lot of the 755-page legislation would be paid for by tax increases that Democrats have said are intended to make the tax code fairer.

The vote put the bill on track to pass the Senate as early as Sunday, with the House expected to give its approval by the end of the week. That would give Mr. Biden a big boost at a time when his popularity is waning, and it would give Democrats a win in November’s midterm elections, where their congressional majorities are at stake.

“Once passed, the bill will meet all of our goals: to fight climate change, lower health care costs, close tax loopholes abused by the wealthy and reduce the deficit,” said Sen. Chuck Schumer of New York, the majority leader. Senate on Saturday. “This is a great victory for the American people and a sad commentary on the Republican Party as they actively fight regulations that lower costs for the American family.”

The hard-fought deal, which includes the most significant investment in history to combat global warming, came after a flurry of intense negotiations with two key Democratic holdouts, Senators Joe Manchin III of West Virginia and Kyrsten Sinema of Arizona.

Just weeks ago, Mr. Manchin, a conservative-leaning Democrat from a red state, had said he could not agree to include climate, energy and tax measures in the domestic policy plan this summer because of his concerns that that it would worsen inflation. But he and Mr. Schumer stunned lawmakers in both parties late last month with the news that they had quietly returned to the negotiating table and entered into an agreement which included these proposals.

And on Thursday, Mrs. Sinema announced that she too would move on after extracting concessions, including dropping a provision that would have narrowed a tax break that allows private equity executives and hedge fund managers to pay significantly lower taxes on some income than other taxpayers do.

Democrats rushed the bill through Congress under the arcane budget process known as reconciliation, which protects certain tax and spending measures from a filibuster but also strictly limits what can be included.

Republicans remain unanimously opposed to the measure and have worked feverishly to derail it, fuming over the resurgence of a plan they thought was dead. Blinded by the deal between Mr. Schumer and Mr. Manchin has struggled to attack the bill as an abomination of big spending, tax increases that will exacerbate inflation and hurt the economy at an uncertain time.

“Democrats are mistaking the outrage of the American people as a mandate for yet another — yet another — reckless taxation and spending spree,” said Sen. Mitch McConnell of Kentucky, the minority leader.

He decried a “tidal wave of Washington interference” that he said would result from the prescription drug plan, which he said would take “a buzz from the research and development behind new, life-saving medical treatments and cures.”

But Democrats have rebranded the transformative cradle-to-grave social safety net and climate plan they once called “Build Back Better” as the Inflation Reduction Act. Operating with a razor-thin Senate majority that gave their most conservative members strong leverage over the measure, Democrats have scrapped hundreds of billions of dollars in proposed spending on domestic programs, as well as many of the tax increases they had proposed to pay for it. .

External estimates has indicated that the measure would not force a huge increase in federal spending or impose significant tax increases outside of large corporations, and it is expected to reduce the federal budget deficit by the end of the decade.

That didn’t stop Republicans from arguing that it would be disastrous for the economy and for Americans. Senator John Cornyn, Republican of Texas, called it the “Manchin-Schumer Tax Hike of 2022.”

Republicans spent much of the past week devising ways to slow or block the legislation, arguing that it violated reconciliation rules. (They indicated privately, however, that they would refrain from forcing Senate secretaries to read the bill aloud after a similar maneuver last year sparked an outcry.)

Elizabeth McDonough, the Senate parliamentarian and her staff worked into the early hours of Saturday morning to determine whether components of the bill violated those rules, which require each provision to have a direct effect on federal spending or revenue. Early Saturday, she directed Democrats to trim the scope of a proposal to prevent drug price increases from outpacing inflation, saying a proposed rebate could only apply to drugs bought by Medicare, not private insurers.

But top Democrats announced that most of the legislation remained intact after Ms. MacDonough’s review, including a plan to allow Medicare to directly negotiate the price of prescription drugs for the first time, restrictions on tax breaks for new electric vehicles and a fee to limit excessive emissions of methane, a greenhouse gas commonly emitted from oil – and gas leaks.

In a last-ditch effort to defeat the measure, Republicans were set as early as Saturday night to begin forcing a series of quick votes on politically toxic amendments — an hours-long ritual known as a vote-a-rama that reconciliation measures must survive to pass . In the evenly divided Senate, all 50 members of the Democratic caucus must remain united to fend off any changes proposed by Republicans and win final passage.

“What’s vote-a-rama going to be like? It’s going to be hell,” promised Sen. Lindsey Graham, Republican of South Carolina. Of Democrats, he said, “They deserve this.”

Democrats, too, could still amend the bill. They are expected to essentially dare Republicans to strip a proposal to cap the cost of insulin for all patients, a popular measure that violates budget rules because it would not directly affect federal spending.

And at least one member of the Democratic caucus, Sen. Bernie Sanders, an independent from Vermont and the chairman of the Senate Budget Committee, has said he plans to force votes on amendments to improve the legislation.

“This is a totally inadequate bill, but it does go some way to addressing the existential threat facing the planet,” said Mr. Sanders in an interview Friday. “I am disappointed.”

However, most Democrats tried to rally their colleagues to remain united against any changes — including those that might be offered by other members of their caucus — to preserve the delicate consensus around the bill and ensure it could become law.

“What I worry about is that we get 50 votes, okay, in the end, and that means we have to keep this deal together,” Sen. Elizabeth Warren, Democrat of Massachusetts, told reporters. “What matters is that we made an agreement and we have to keep that agreement intact.”

Lisa Friedman, Stephanie Lai and Sheryl Gay Stolberg contributed with reporting.

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Javed Iqbal

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