The Senate passed the Inflation Reduction Act along party lines following hours of debate and a flurry of amendments that stretched through Saturday night and into Sunday afternoon.
Vice President Kamala Harris cast the tiebreaking 51st vote for the Democrats after a grueling vote-a-rama on the roughly $740 billion budget reconciliation measure that forewent the 60-vote threshold, securing another policy win for the Biden administration. The House, also controlled by Democrats, will reconvene from the August recess on Friday to pass the legislation in the lower chamber.
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“The Inflation Reduction Act that this Senate Democratic Majority has passed will endure as one of the defining legislative feats of the 21st century: It reduces inflation, lowers costs, creates millions of good-paying jobs, and is the boldest climate package in US history ,” Senate Majority Leader Chuck Schumer (D-NY) said in a tweet.
The Inflation Reduction Act that this Senate Democratic Majority has passed will endure as one of the defining legislative feats of the 21st century:
It reduces inflation, lowers costs, creates millions of good-paying jobs, and is the boldest climate package in US history.
— Chuck Schumer (@SenSchumer) August 7, 2022
Biden urged the House to pass the legislation quickly and promised to sign it.
“Today, Senate Democrats sided with American families over special interests, voting to lower the cost of prescription drugs, health insurance, and everyday energy costs and reduce the deficit, while making the wealthiest corporations finally pay their fair share. I ran for President promising to make government work for working families again, and that is what this bill does — period,” he said in a statement released by the White House.
Senate Democrats argued legislation to keep the focus on the at hand at hand throughout the proceedings, while Republicans forced votes on amendments. The amendments cornered Democrats into taking stances on politically charged issues ranging from border security to the definition of pregnancy. Republicans, too, were put on the spot as most of them rallied together to defeat a provision that would cap the monthly price of insulin at $35.
Democrats said the bill will reduce the deficit by $300 billion over the next 10 years, while Republicans hold that it will make inflation worse and create a new tax burden on lower-income Americans and stifle incentives for research.
“In President Biden’s America, the average family is either paying thousands of dollars extra per year to tread water or watching their standard of living dissolve before their eyes,” Senate Minority Leader Mitch McConnell (R-KY) said after the bill passed. Democrats’ policies have torn down the savings, the stability, and the lifestyles that families worked and sacrificed for years to build up. The effect of this one-party government has been an economic assault on the American middle class.”
The legislation was the result of a compromise among Democrats, approved by centrist Sens. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ), falling somewhat short of what the Biden administration wanted. The agreed-upon legislation, heading into the weekend, included $400 billion in tax credits to incentivize renewable energy, including for consumers who choose electric vehicles instead of gas-powered and for energy companies to prioritize wind and solar energy sources. This is the single largest spending commitment to combat global warming the federal government has ever approved.
There are also concessions to oil and coal companies to appease Manchin, whose vote is vital for Democrats to pass anything with the 50-50 partisan split. Among these concessions are an assurance of new leases for oil drilling in Alaska and the Gulf of Mexico.
At the very end of the vota-a-rama, Sinema and a handful of other Democrats successfully rallied behind an amendment from Sen. John Thune (R-SD) to exclude subsidiaries of companies owned by private equity firms.
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For the first time, Medicare will be able to negotiate drug prices with manufacturers, beginning in 2026 with 10 initial drugs. Republicans opposed this provision on the grounds that the lack of free market forces could stifle innovation, while some Democrats said it wasn’t enough. Seniors on public insurance will have their out-of-pocket prescription drug costs capped at $2,000 per year.
The Internal Revenue Service will get a funding increase, enough to bring on 87,000 new employees whom Democrats hope can crack down on wealthy tax evaders. Republicans have said this will increase scrutiny on small- and medium-sized businesses and taxpayers beneath the highest tax brackets.