WASHINGTON — Senate Democrats narrowly passed a sweeping climate and economic package on Sunday, leavin President Joe Biden and his party on the cusp of a major legislative victory just three months before the pivotal midterm elections in November.
After an overnight Senate marathon session, the 51-50 vote was strictly along party lines, with all Republicans voting no and all Democrats voting yes. After Vice President Kamala Harris cast the casting vote, Democrats stood up and applauded.
The legislation, called the Inflation Reduction Act, now goes to the House, which plans to return Friday from its summer recess, pass the legislation and send it to Biden’s office for signature.
“It’s been a long, difficult and winding road, but we’re finally here. I know it’s been a long day and a long night. But we made it today,” Senate Leader Chuck Schumer said on the floor before the final vote.
“After more than a year of hard work, the Senate is making history. I am confident that the Inflation Reduction Act will continue to exist as one of the defining legislative achievements of the 21st century.”
The 755-page bill includes $430 billion to fight climate change and expand health care coverage, paid for with savings on prescription drugs and corporate taxes. It is investing hundreds of billions of dollars in deficit reduction.
Most of the spending — more than $300 billion — is investment to tackle climate change and boost clean energy, including incentives for farmers and ranchers to reduce methane emissions; an extension of the tax credit for electric vehicles; and the launch of a National Climate Bank that would invest in clean energy and energy efficiency technologies.
The legislation would allow Medicare to negotiate prices with drug companies for the first time, lowering prices for prescription drugs for seniors. The savings would help pay for a three-year extension of the Affordable Care Act subsidies, preventing a projected increase in insurance premiums that would come into effect in 2023.
The package includes a cap on the price of insulin for seniors on Medicare, but Republicans have successfully removed a $35 cap on insulin from the private market.
The bill also increases revenues through a new minimum tax of 15% on large companies, although accelerated depreciation would be exempted – a key question from centrist Senator Kyrsten Sinema, D-Ariz. the package.
Sinema also successfully disabled a provision to close the tax rate loophole that benefits private equity and hedge fund managers. It was replaced, with Sinema’s support, by a 1% excise tax on share buybacks, effectively bringing in more revenue than the carry rate provision would have had.
The legislation was passed quickly. Less than two weeks ago, Senate Leader Chuck Schumer and Senator Joe Manchin, D-W.V., announced a surprise deal on some of the party’s key agenda items that many Democrats thought had no chance of becoming law this year.
Democrats view the expanded package as the latest in an unusual string of legislative victories for a Congress typically mired in a partisan stalemate. Last year there was a $1 trillion infrastructure package, the most significant weapons reform bill in a generation, a major semiconductor and science competitiveness package, a bill to help veterans exposed to fire pits, and a vote to help Finland and Sweden. into NATO during a confrontation with Russia.
“Mitch McConnell and the Republicans are behind Big Oil, are behind Big Pharma to protect their profits, and we’ve been trying for years” to cut costs, Sen. Debbie Stabenow, D-Mich., head of the Democratic Policy Committee,
“This is the big moment here with these powers,” she said, “and the people are going to win.”
sen. Cory Booker, D-N.J., a progressive and one-time presidential rival to Biden in 2020, also noted Congress’s recent advances.
“I don’t know if there has been a Congress and a President that has been as productive as we have seen in this Congress,” he said in an interview. “This president continues to impose historic bills that address the urgency of the American public.”