After a long struggle, US President Joe Biden’s Democrats have finally agreed on a slimmed-down climate protection and social package – a potentially important political success before the mid-term congressional elections in November.
Influential Senator Joe Manchin from the conservative Democrat wing, who had long blocked Biden’s agenda, surprisingly announced an agreement with Senate Majority Leader Chuck Schumer on Wednesday.
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According to the Democrats, the package includes investments of 369 billion dollars (around 363 billion euros) for energy security and climate protection over a period of ten years. In addition, the state health insurance company Medicare is to be given the right to negotiate the prices of certain prescription drugs with the pharmaceutical industry, which should lead to lower prices.
To finance the additional expenditure, taxes on large corporations are to be increased, among other things. A consistent minimum tax rate of 15 percent is expected to bring in $313 billion over ten years. According to the Democrats, the package of measures will enable the budget deficit to be reduced by $300 billion over ten years. This should also help in the fight against the current inflation, which had recently climbed to a 40-year high of 9.1 percent.
The President welcomed the agreement between Schumer and Manchin, who, given the extremely tight majority in the Senate, has a kind of veto power. “The Americans have been waiting for these acts,” Biden said. “It addresses today’s problems – high healthcare costs and general inflation – and invests in our energy security for the future.”
The President, whose approval ratings have slipped to below 40 percent, spoke of a “historic” legal text. He called on the Senate and House of Representatives to quickly pass the bill, dubbed the 2022 Inflation Reduction Bill.
If the bill actually passes Congress, it would be a huge win for Biden. The 79-year-old’s ambitious reform agenda has so far failed in many respects due to resistance from the opposition Republicans, but also from Manchin’s resistance. Passing the bill would also give the Democrats important tailwinds for November’s congressional midterm elections, in which the party threatens to lose majorities in both houses.
Last year, Manchin almost single-handedly stopped the president’s multi-trillion climate protection and social package called “Build Back Better.” Just a few weeks ago, the senator, who has close ties to the coal industry, once again made his opposition to new funds in the fight against global warming clear.
He said the reasoning was that the government shouldn’t continue to fuel the high inflation by spending additional billions. On Wednesday, the 74-year-old said the compromise that has now been found will lower inflation.
Given the majority in the Senate, Manchin can block Biden’s reform plans. Democrats and Republicans each provide 50 senators, and in the event of a stalemate, Vice President Kamala Harris, in her role as Senate President, casts the deciding vote with her vote. This means that without the help of Republican senators, all Democrats must vote unanimously for a law to pass. This gives Manchin extremely great bargaining power.
