Topline
Centrist Sen. Joe Manchin (D-W.Va.) announced Wednesday he has reached a deal with Senate Majority Leader Chuck Schumer (D-N.Y) on a tax, energy and healthcare bill called the “Inflation Reduction Act of 2022,” which appears to be an extremely scaled-down version of the multi-trillion-dollar Build Back Better bill Democrats proposed last year.
Sen. Joe Manchin (D-W.Va.) talks with the media in Washington on July 19, 2022. (Tom … [+]
Key Facts
Manchin championed the bill as “laser focused on solving our nation’s major economic, energy and climate problems,” by spending $369 billion on energy and combating climate change while also reducing the deficit by more than $300 billion over the next decade.
Manchin noted the bill does not, however, “arbitrarily shut off our abundant fossil fuels.”
The bill would also extend until 2025 a set of Affordable Care Act health insurance subsidies that were set to expire this year, according to Manchin and Schumer.
The bill proposes more than $700 billion in new revenue, primarily through a 15% minimum corporate tax on large businesses, reforms to prescription drug pricing and enhanced Internal Revenue Service enforcement measures.
Democrats say the bill would reduce carbon emissions by around 40% by 2030, cap out-of-pocket drug costs at $2,000 for Americans on Medicare and not raise taxes on families making $400,000 or less a year.
Crucial Quote
“Contrary to foolish talk otherwise, America cannot spend its way out of debt or out of inflation,” Manchin said in a statement that was very critical of earlier Democratic spending proposals.
What To Watch For
Democrats intend to pass the bill through the budget reconciliation process, which does not require the 10 Republican votes normally needed to overcome the Senate filibuster as long as all 50 Democrats vote “yes.” President Joe Biden said in a statement Wednesday he supports the bill, and encouraged the Senate to move on it “as soon as possible.”
Key Background
Biden and top Democrats in Congress pushed last year for the sweeping Build Back Better social spending bill, a package of climate, healthcare and social safety-net programs with an initial $3.5 trillion price tag. The price was eventually whittled down to about $1.8 trillion, but Manchin and fellow centrist Sen. Kyrsten Sinema (D-Ariz.) continued to oppose the bill over concerns it would lead to even higher rates of inflation. After months of negotiation, Manchin told Fox News in December that he could not support the bill, leading to widespread backlash from fellow Democrats that included a White House statement calling the senator’s position an “inexplicable reversal.” Manchin reiterated his opposition to a big spending bill in his statement Wednesday, saying: “Build Back Better is dead.”
Further Reading
Manchin Says He Won’t Support Build Back Better—White House Calls It ‘Inexplicable Reversal’ (Forbes)
Here’s Why Democrats’ $3.5 Trillion Budget Plan Could Impact Every Single American (Forbes)
Source: https://www.forbes.com/sites/nicholasreimann/2022/07/27/manchin-strikes-deal-with-schumer-on-energy-and-healthcare-bill-including-remnants-of-build-back-better/