Climate and tax law approves test vote in Senate

WASHINGTON — A divided Senate on Saturday took a crucial step toward approving Democrats’ plan to tackle climate change, cut health care costs and raise taxes on big business, with a test vote that puts the paved the way for a significant portion of President Biden’s domestic policies. agenda for the next few days.

The measure moved forward after a 51-to-50 party vote, with all Republicans against and Vice President Kamala Harris breaking the tie.

The move suggested that, after more than a year of internal feuds and meticulous negotiations, Democrats had finally united behind legislation that would bring hundreds of billions of dollars into climate and energy programs, extend the Affordable Care Act subsidies and launch a new federal initiative. would create to reduce the cost of prescription drugs, especially for older Americans.

A lot of the 755 page legislation would be paid for by tax increases, which Democrats have said are intended to make the tax code more equitable.

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 would give Democrats a victory in the November midterm elections, with their majorities in Congress at stake.

“If passed, the bill will meet all of our goals: fighting climate change, lowering health care costs, closing the tax loopholes exploited by the rich and reducing the deficit,” he said. New York Senator Chuck Schumer, the majority leader, on the Senate floor on Saturday. “This is a great victory for the American people and a sad commentary on the Republican Party actively fighting against facilities that lower costs for the American family.”

The hard-won deal, which includes the most substantial 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, given his concern that this inflation would worsen. But he and Mr. Schumer stunned lawmakers in both parties late last month with news that they had quietly returned to the negotiating table and struck a deal that included those proposals.

And on Thursday, Ms. Sinema announced that she, too, would move forward after securing concessions, including scrapping a provision that would have reduced a tax break that would allow private equity executives and hedge fund managers to pay significantly lower taxes on some earnings than other taxpayers do. .

Democrats accelerated the bill through Congress under the secretive budget process known as Reconciliation, which shields certain tax and spending measures from a filibuster, but also strictly limits what can be included.

Republicans unanimously oppose the measure and have worked feverishly to derail it, furious at the revival of a plan they thought was dead. Blinded by the deal between Mr. Schumer and Mr. Manchin, they have gone out of their way to attack the bill as an abomination of major spending, tax hikes that will exacerbate inflation and hurt the economy at a precarious time.

“Democrats are misinterpreting the outrage of the American people as a mandate for yet another – reckless tax and spending wave,” said Kentucky Senator Mitch McConnell, the minority leader.

He denounced a “tidal wave of interference in Washington” that he said would result from the prescription drug plan, which he said would “generate a buzz-saw for the research and development behind new, life-saving medical drugs.” treatments and treatments.”

But the Democrats have renamed the transformative social safety net and climate plan they once called “Build Back Better” the Inflation Reduction Act. Operating with a wafer-thin Senate majority giving their most conservative members strong leverage over the measure, Democrats jettisoned 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 them.

Outside estimates have indicated that the measure would not force a massive increase in federal spending or impose substantial tax increases outside large corporations, and the federal budget deficit is expected to narrow by the end of the decade.

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

Republicans spent much of the past week trying to figure out ways to delay or block legislation by alleging it violated the reconciliation rules. (However, they privately stated that they would not force Senate clerks to read the bill aloud, after a similar maneuver sparked outrage last year.)

Elizabeth MacDonough, the Senate MP, and her staff worked into the wee hours of Saturday morning to determine whether parts of the bill violated those rules, which require each provision to have a direct effect on federal spending. or income. Early Saturday, she told Democrats to cut the scope of a proposal designed to prevent the rise in drug prices from surpassing inflation, saying a proposed cut could only apply to drugs that are purchased by Medicare, not private insurers.

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

In a last-ditch effort to defeat the measure, Republicans were set as early as Saturday night to force a quick run of votes on politically toxic amendments — an hour-long ritual known as a vote-a-rama that should require reconciliation measures. survive to be approved. In the evenly divided Senate, all 50 members of the Democratic caucus will have to remain united to fend off any changes proposed by Republicans and win the final passage.

“What will vote-a-rama be like? It will be hell,” South Carolina Republican Senator Lindsey Graham promised. Of the Democrats, he said, “They deserve this.”

Democrats could also change the bill. They are expected to essentially challenge Republicans to scrap a proposal to limit the cost of insulin for all patients, a popular measure that violates budget rules because it would not directly affect the federal government. expenses.

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

“This is a totally inadequate bill, but it begins to some extent to address the existential threat facing the planet,” Sanders said in an interview on Friday. “I’m disappointed.”

Most Democrats, however, tried to rally their peers to stay united against any amendments — including those that might be offered by fellow members of their caucus — in order to maintain the delicate consensus surrounding the bill and ensure it would become law.

“What matters to me is we get 50 votes in the end, okay, and that means we have to keep this deal together,” Massachusetts Democrat Senator Elizabeth Warren told reporters. “It’s about making a deal, and we have to keep that deal intact.”

Lisa Friedman, Stephanie Laic and Sheryl Gay Stolberg reporting contributed.