After weeks (technically months, really) of negotiations, Senate Democrats passed their massive spending bill addressing a range of issues from climate to health care to taxes. The “Inflation Reduction Act” (renamed from “Build Back Better” to appease Joe Manchin’s ego) passed the Senate 51-50 with a tiebreaker from Vice President Kamala Harris.
The bill is an extremely watered-down, barebones version of the ambitious package first proposed by President Joe Biden last year, but there is still a lot of good stuff in there. There is also a lot that it leaves out.
The bill itself is 755 pages long, so let’s just tackle some highlights in three major categories.
Climate Action
The bill dedicates more than $300 billion for investment in climate and energy reform. That is both the largest investment of its kind in U.S. history and also far short of the $555 billion proposed in the original bill.
“This portion of the bill takes on transportation and electricity generation, and it includes $60 billion for growing renewable energy infrastructure in manufacturing like solar panels and wind turbines,” NPR writes. “It also includes several tax credits for individuals on things like electric vehicles and making homes more energy efficient.”
There’s also quite a bit of money dedicated to corporate incentives for carbon capture and storage, which is essentially a process that removes carbon dioxide from energy emissions before it reaches the atmosphere and stores it in a way that creates zero-emission energy. That sounds great, and it probably would be if it were a real thing, which it currently is not. This is a future technology—basically wishful thinking—not something that currently exists.
The inclusion of carbon capture and storage is a glaring example but by no means the only way in which large portions of this bill aim to put a big green bow on the existing fossil fuel industry rather than fully invest in renewable energies. And of course, that’s largely the work of Congress’ #1 coal fan, Joe Manchin.
Corporate Taxes
The bill will implement a 15% minimum tax on corporations that bring in more than $1 billion a year. That’s definitely better than the zero percent minimum tax on corporations bringing in less that a billion dollars a year but also feels like a really low bar to be celebrating.
Kyrsten Sinema ended up getting her way and got the carried interest loophole removed from the bill. Democrats wanted to remove or at least severely narrow that loophole, which allows hedge fund managers and other ultra-wealthy investors to pay significantly lower taxes than they owe. Sinema refused to vote for the bill unless it was nicer to her uber-rich donors.
Healthcare
The bill will reduce the cost of prescription drugs but with a whole bunch of caveats. It allows the federal health secretary to negotiate the price of certain drugs under Medicare. That includes a reduce in the price of 10 drugs by 2026 and 20 drugs by 2029.
Republicans also once again blocked a provision that would have capped the cost of insulin at $35 a month for private insurance holders because they genuinely don’t care if we live or die.
The bill will now move on the House where it should have no problem passing.
(image: Chip Somodevilla/Getty Images)
