Washington: Democrats boosted their election year economic package headed for Senate approval early Sunday, is debating a measure less ambitious than President Biden’s original national vision but touching on deep-seated partisan dreams of curbing global warming, moderating drug costs and taxing to huge corporations.
Debate began Saturday and by sunrise Sunday, Democrats had rejected a dozen Republican efforts to scuttle the legislation, with no clear end in sight. Despite unanimous GOP opposition, the 50-50 Democratic unity in the chamber, bolstered by Vice President Kamala Harris’ tie-breaking vote, suggested the party was on track for a morale-boosting victory three months from elections when control of Congress is at stake.
The House was scheduled to briefly return from summer recess on Friday for what Democrats hope will be final congressional approval.
“I think it’s going to happen,” Biden told reporters as he left the White House early Sunday to go to Rehoboth Beach, Delaware, ending his COVID-19 isolation. The House appeared on track to give final approval when Congress briefly returns from summer recess on Friday.
“It’s going to reduce inflation. It’s going to lower prescription drug costs. It’s going to fight climate change. It’s going to close tax loopholes and reduce and reduce the deficit,” Senate Majority Leader Chuck Schumer, D-New York, said of the package . “It will help all the citizens of this country and make America a much better place.”
Republicans said the move would undermine an economy that policymakers are struggling to prevent from falling into recession. They said the bill’s business taxes would hurt job creation and force prices skyward, making it harder for people to cope with the nation’s worst inflation since the 1980s.
“Democrats have already robbed American families once through inflation, and now their solution is to rob American families a second time,” argued Senate Minority Leader Mitch McConnell , from Kentucky. He said the spending and tax increases in the legislation would eliminate jobs and have a negligible impact on inflation and climate change.
Nonpartisan analysts have said the Democrats’ “Inflation Reduction Act” would have a smaller effect on rising consumer prices. The bill is barely more than a tenth of Biden’s initial 10-year, $3.5 trillion rainbow of progressive aspirations and abandons his proposals for universal preschool, paid family leave and extended child care assistance.
Still, the new measure gives Democrats a campaign-season showcase for action on coveted goals. It includes the largest federal effort on climate change, nearly $400 billion, gives Medicare the power to negotiate drug prices and extends expiring subsidies that help 13 million people pay for health insurance.
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Mr. Biden’s original measure collapsed after conservative Democratic Senator Joe Manchin of West Virginia opposed it, saying it was too costly and would fuel inflation.
In an ordeal imposed on all budget bills like this one, the Senate fell into a “vote-a-rama” of a few hours of quick amendments. Each tested the ability of Democrats to hold together a compromise brokered by Schumer, progressives, Manchin and the inscrutable Democratic Sen. Kyrsten Sinema of Arizona.
Progressive Sen. Bernie Sanders of Vermont offered amendments to further expand the legislation’s health benefits, and those efforts were defeated. But most of the proposed changes were designed by Republicans to unravel the bill or force Democrats to vote on dangerous political ground.
A GOP proposal would have forced the Biden administration to continue Trump-era restrictions that cited the pandemic to reduce the flow of migrants at the Southwest border.
Earlier this year, Democrats facing tough re-elections backed that extension, forcing the party to abandon its push for COVID-19 spending as Republicans conflated the two issues. This time, with their much larger economic legislation on the line and the election looming, Democrats rallied against border controls.
Other GOP amendments would have required more gas and oil leases on federal lands and blocked the renewal of an oil tax that helps fund toxic waste cleanup. All were rejected on party-line votes. Republicans accused Democrats of being soft on border security and opening the door to higher energy and gas costs.
Before debate began Saturday, the bill’s prescription drug prices were cut diluted by the non-partisan parliamentarian of the Senate. Elizabeth MacDonough, who advises questions on the chamber’s procedures, said a provision that would impose costly penalties on drugmakers whose price increases for private insurers exceed inflation should fall.
It was the bill’s main protection for the 180 million people with private health coverage they get through work or purchase. Under special procedures that will allow Democrats to pass their bill by a simple majority without the usual 60-vote margin, its provisions must focus more on dollars-and-cents budget numbers than policy changes.
But the thrust of his pharmaceutical pricing language remained. That included letting Medicare negotiate what it pays for drugs for its 64 million seniors, penalizing manufacturers for over-inflating pharmaceuticals sold to Medicare and capping beneficiaries’ out-of-pocket drug costs at $2,000 a year.
The bill also caps patient costs for insulin, the expensive diabetes drug, at $35 a month.
Final costs of the measure were being recalculated to reflect late changes, but overall it would raise more than $700 billion over a decade. The money would come from a minimum tax of 15% on a handful of corporations with annual profits above $1 billion, a 1% tax on companies that buy back their own shares, strengthen tax collection from the IRS and government savings due to lower drug costs.
Sinema forced Democrats to abandon a plan to prevent wealthy hedge fund managers from paying less than individual income tax rates on their earnings. He also joined with other Western senators to win $4 billion to fight the region’s drought.
It was on the energy and environment side where the compromise was most evident between progressives and Manchin, a supporter of fossil fuels and his state’s coal industry.
Clean energy would be encouraged with tax credits for the purchase of electric vehicles and the manufacture of solar panels and wind turbines. There would be energy rebates to households, funds to build factories that build clean energy technology, and money to promote climate-friendly agricultural practices and reduce pollution in minority communities.
Manchin won billions to help power plants reduce carbon emissions and language requiring more government auctions for oil drilling on federal lands and waters. Party leaders also pledged to push separate legislation this fall to speed up permitting for energy projects, which Manchin wants to include a nearly completed natural gas pipeline in his state.
