Senate Majority Leader Chuck Schumer (D-NY) and Sen. Joe Manchin (D-WV) jointly unveiled a deal centered on climate investments and lowering prescription drug prices, a seemingly resurrected version of the bill Manchin killed two weeks ago.
The bill, befitting the reason Manchin nixed its predecessor, is called “The Inflation Reduction Act of 2022.”
The bill will invest “$369 billion in Energy Security and Climate Change programs over the next ten years,” will allow Medicare to negotiate prescription drug prices and will extend critical Affordable Care Act subsidies for three years, per a bill summary.
It will also put into place a 15 percent minimum corporate tax, but only on companies of $1 billion or larger, per Manchin’s statement. Sen. Kyrsten Sinema (D-AZ), who killed a corporate minimum tax provision of the Build Back Better reconciliation package, has since come out in favor of such a tax when applied to corporations making $1 billion or more in profits.
Some of the details in the plan are still murky: it’s unclear which drugs Medicare will be able to negotiate down, and the climate provisions are broad — the summary characterizes them as a “historic down payment” to “reduce carbon emissions by roughly 40 percent by 2030.”
Manchin, who personally and significantly profits off of the coal industry, included in his statement that this bill will not invest in renewables to the exclusion of fossil fuels.
“The Inflation Reduction Act of 2022 invests in the technologies needed for all fuel types – from hydrogen, nuclear, renewables, fossil fuels and energy storage – to be produced and used in the cleanest way possible,” he wrote. “It is truly all of the above, which means this bill does not arbitrarily shut off our abundant fossil fuels.”
The bill will also seemingly not address the State And Local Tax (SALT) deduction cap, a hobbyhorse for those of Rep. Josh Gottheimer’s (D-NJ) ilk, per the Manchin statement.
“Our tax code should not favor red state or blue state elites with loopholes like SALT…” he wrote.
Gottheimer and a few other House Democrats helped force Build Back Better to be delinked from the bipartisan infrastructure bill earlier this year, hastening BBB’s demise.
Democrats have a very small margin with which to pass legislation in the House, and SALT could potentially raise issues with a small group of Democratic representatives who represent high-income districts.
The Senate Parliamentarian will review the text Wednesday evening, and it will go before the full Senate for a vote next week, per Schumer.
The deal was unveiled just after the Senate passed a computer chips bill — a notable sequence, as Senate Minority Leader Mitch McConnell (R-KY) threatened to kill the chips bill if Democrats didn’t abandon their reconciliation talks.
The bill is a far cry from Democrats’ sweeping, ambitious BBB package of earlier this year, which would have addressed everything from free pre-K to a massive climate overhaul. But it’s unexpected new life breathed into negotiations that seemed dead just days ago.
If this version of the reconciliation bill can pass, it’ll give Democrats a legislative win to point toward after months of disappointment at Manchin’s hands, just in time for midterm campaigning to rev into full swing.
Read the bill summary here: