WASHINGTON (CN) — After months of interparty wrangling, tense backroom negotiations and a marathon weekend session to get the legislation across the Senate finish line, Democrats sent a climate and health care bill over to the House that fulfills a longstanding campaign promise of President Joe Biden and could boost the party's prospects as November midterms draw ever-nearer.
It was a strict party-line vote on Sunday afternoon as all Senate Democrats, with the tie-breaking support of Vice President Kamala Harris, voted to pass the Inflation Reduction Act, a massive reconciliation bill that empowers Medicare to negotiate prescription drug prices and includes the largest federal investment in green energy and emissions reductions in U.S. history, paid for through changes to corporate tax laws and robust funding for the IRS.
Democrats say those revisions to tax law and increased funding for the IRS to go after tax evaders will pay for the law while also cutting a burgeoning deficit by $300 billion over the next decade, though the nonpartisan Congressional Budget Office puts that number closer to $100 billion.
The bill itself was a surprise to many. Democrats had spent the better part of a year fighting for party unity in the Senate over some version of what once was the $2 trillion social safety net legislation known as the Build Back Better Act. That bill included some of the hallmark items of Biden's presidential campaign, including climate change investments, free universal preschool and monthly child tax credits.
Senator Joe Manchin, a Democrat from West Virginia and key vote in the party, put the nail in Build Back Better's coffin earlier this year. But it was also Manchin who worked with Senate Majority Leader Chuck Schumer to draft a new bill and eventually put his seal of approval on the legislation now known as the Inflation Reduction Act.
"Build Back Better has been described by some Democrats as the right bill at the wrong time, just given the inflationary environment that we're living in. But I think if you're a Democratic partisan or a staffer, or you’re Senator Schumer, or even in the White House, you have to be absolutely thrilled over what happened this weekend," Carlos Algara, associate professor of political science at Claremont Graduate University, said in an interview.
Some of the provisions being celebrated include a $369 billion investment in energy and climate change programs over 10 years, a cap on monthly insulin prices for people who use Medicare and an extension of subsidies under the Affordable Care Act for people purchasing their own insurance. The aid program was set to expire this year, but will now be funded through 2025.
"What the exclamation mark is is that Democrats were able to do all of this over completely unified Republican opposition. And the thing that surprises me the most, frankly, is Senator Schumer got the best of Senator McConnell. In many cases in this Senate it's a little unclear who runs, strategically, the show," Algara said. "And the fact that McConnell got caught so flat-footed and that [Republicans] truly believed that Senator Manchin was a hard no on any reconciliation bill was really surprising."
In order to get Arizona Democrat Kyrsten Sinema on board with the surprise deal, negotiators agreed to axe a provision that would have targeted a tax loophole used by hedge funds and add new funding for drought resiliency. That funding will direct the Bureau of Reclamation to conserve water resources and build up climate change efforts as Western states, including Sinema’s home state of Arizona, grapple with a historic drought.
Manchin's support of the bill came with its own concessions, including mandates for oil and gas leases in Alaska and the Gulf of Mexico that appear in conflict with the incentives for offshore wind, electric vehicles and other clean energy infrastructure.