August 17, 2022


The package is the product of painstaking negotiations and will give Democrats a chance to achieve key policy goals before the upcoming midterm elections. Senate Democrats use a special process to pass the package without Republican votes.

Once the legislation passes in the Senate, it will then need House approval before President Joe Biden can sign it into law.

The Senate is expected to hold its first procedural vote to advance the bill sometime on Saturday. A simple majority is required to proceed with the proposal.

Democrats control the narrowest possible majority and just 50 seats in the Senate, but they are expected to unite to push the bill in an initial procedural vote.

Arizona Senator Kirsten Senema offered critical support Thursday night after party leaders agreed to change new tax proposals, signaling they would “move forward” with the comprehensive economic package.
West Virginia Democratic Senator Joe Manchin also played a key role in shaping the legislation — which does not move forward until after Manchin and Senate Majority Leader Chuck Schumer announce a deal at the end of July, a major achievement for Democrats after earlier negotiations had stalled.
Senate Democrats need only a simple majority for final approval of the bill because they use a process known as reconciliation, which allows them to avoid Republican obstruction and the corresponding 60-vote threshold.
In order for a bill to pass through the settlement process, the package must comply with a strict set of budget rules. The senator must decide whether provisions in the bill meet the rules to allow Democrats to use the anti-stall budget process to pass legislation along partisan lines. Senate Finance Chief Ron Wyden of Oregon announced early Saturday that the clean energy tax portion of the bill “complies with Senate rules, and Parliamentarian has approved important provisions to ensure America’s clean energy future is built.” Senate Democrats are still awaiting key rulings from the parliamentarian on Medicare and prescription drug prices.

Schumer has yet to decide when he plans to start the debate this weekend, according to one of his top Democratic aides. The timing of this vote is key because it will start the process and determine when the bill will finally get its final vote. If Schumer waits for that first vote to open the debate, he may postpone the rest of the votes on the bill until later on Saturday or even all day Sunday.

The reason the Democratic leaders haven’t made a decision yet is because they are waiting for the parliamentarian’s rulings. The aide said that while they don’t need it to rule before the first procedural vote, the Democrats’ goal is to make any changes you request before the process begins. As a result, the timing of the vote on the amendments and final approval of the bill is highly volatile.

What happens after the bill faces its first major vote?

If the first procedural vote to move forward on the bill gets the support of all 50 members of the Democratic caucus, which is expected, there will be up to 20 hours of debate split evenly between the parties, although some of that time could be returned to speed up the process.

After time for discussion, there will be a process colloquially referred to on Capitol Hill as a “rama vote” – a long series of votes on amendments with no time limit that must take place before the final vote is taken.

Republicans will be able to use the Rama voting system to put Democrats in place and force difficult political votes. The process usually extends overnight and into the early hours of the next morning. It’s not yet clear exactly when the Rama voting will start, but it could start as early as Saturday night. If that happens, the final vote will likely take place as soon as the early hours of Sunday morning.

The House is preparing to return to consider the legislation on Friday, August 12, according to the office of House Majority Leader Steny Hoyer.

How does the bill tackle the climate crisis?

For the party that failed to pass key climate legislation more than 10 years ago, the reconciliation bill represents a major victory for Democrats.

The nearly $370 billion Clean Energy and Climate Package is the largest climate investment in U.S. history, and the environmental movement’s biggest victory since the landmark Clean Air Act. It also comes at a critical time. This summer has seen severe heat waves and deadly floods across the country, which scientists say are linked to a warm planet.

Analysis by Schumer’s office—as well as several independent analyzes—suggests that the actions will reduce US carbon emissions by up to 40% by 2030. Strong climate regulations from the Biden administration and action from states will be needed to reach the target. Biden’s goal is to cut emissions by 50% by 2030.

The bill also contains several tax incentives aimed at lowering the cost of electricity with more renewables, and incentivizing more American consumers to switch to electricity to power their homes and vehicles.

Lawmakers said the bill represents a massive victory and is also just the beginning of what is needed to combat the climate crisis.

“This is not about the laws of politics, it’s about the laws of physics,” Democratic Senator Brian Schatz of Hawaii told CNN. “We all knew when we got into this effort that we had to do what the science tells us what we ought to do.”

Home health care and tax policy in the bill

The bill would enable Medicare to negotiate prices for some expensive drugs that are given in doctors’ offices or bought at a pharmacy. The Secretary of Health and Human Services will negotiate prices for 10 drugs in 2026, another 15 in 2027 and again in 2028. The number will increase to 20 drugs per year for 2029 and beyond.

This controversial provision is far more limited than what House Democratic leaders have supported in the past. But it would open the door to the party’s long-term goal of allowing Medicare to use its weight to cut drug costs.

Democrats also plan to extend the enhanced federal benefits to cover Obamacare through 2025, a year after lawmakers recently debated. This way it will not expire after the 2024 presidential election.

To boost revenue, the bill would impose a minimum tax of 15% on large corporate reporting income to shareholders, known as written income, as opposed to the Internal Revenue Service. The measure, which will raise $258 billion over a decade, will apply to companies with more than $1 billion in profits.

Concerned about how the ruling might affect some businesses, particularly manufacturers, Sinema suggested she won changes to the Democrats’ plan to curtail how companies deduct expendable assets from their taxes. Details are still unclear.

However, Sinema has canceled her party’s efforts to tighten the carry interest loophole, which allows investment managers to treat much of their compensation as capital gains and pay the 20% long-term capital gains tax rate instead of the 37% income tax rates.

This ruling would have lengthened the amount of time investment managers must hold the interest of their earnings from three to five years to take advantage of the lower tax rate. Addressing this loophole, which would have raised $14 billion over a decade, has been a long-standing goal of Congressional Democrats.

In its place, a 1% selective tax was added on corporate share buybacks, raising another $74 billion, according to a Democratic aide.

CNN’s Manu Raju, Ella Nielsen, Tami Lube, Katie Lubosco and Melanie Zanona contributed to this report.



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