(Bloomberg) -- The Senate voted to open debate on a landmark tax, climate change and drug-price bill during a rare Saturday session that is expected to continue late into the night.
The $437 billion, 755-page bill, a slimmed down version of President Joe Biden’s multitrillion-dollar domestic agenda, is on track for passage after a year of wrangling with two holdout Democrats, Senators Joe Manchin and Kyrsten Sinema, over the contents of the package.
“This is one of the most consequential and impactful bills Congress has seen in decades,” Senate Majority Leader Chuck Schumer said as the debate and a marathon slog through scores of proposed amendments got underway.
The vote was 51-50 with Vice President Kamala Harris breaking the tie. Vermont Democratic Senator Patrick Leahy arrived via wheelchair to cast the vote, after being absent for weeks due to hip surgery.
Senate Democrats Release Final Tax-Climate Bill Text: Document
The legislation would allow Medicare to negotiate drug prices for the first time, starting with 10 high-priced drugs by the middle of this decade and expanding from there. It would cap out of pocket drug costs for seniors enrolled in Part D at $2,000 per year and their spending on insulin at $35 per month. Savings from these lower drug prices is used to pay for three years of subsidized Obamacare premiums. Without an extension, discounted premiums made available during the Covid-19 pandemic are set to expire in January.
The bill would also provide roughly $374 billion in climate and energy spending, including on expanded tax credits for the purchase of electric vehicles and to fund renewable energy projects. Funding for this comes from the establishment of a 15% corporate minimum tax on large firms, a 1% excise tax on the value of stock buybacks and revenue gained from an $80 billion boost to the Internal Revenue Service budget for tax enforcement.
Manchin, of West Virginia, agreed to the outline of the deal last month in a surprise deal he negotiated in secret with Senate Majority Leader Chuck Schumer and after he secured funding for coal-related projects, requirements that public lands be opened to fossil fuel projects when opened for renewable projects, and a promise to pass a separate bill easing environmental reviews of energy projects.
Arizona Senator Sinema endorsed it this week after a proposal to narrow a the carried interest loophole was dropped and an exception to the minimum corporate tax was made for accelerated depreciation tax deductions used by many manufacturers. She also helped win a $4 billion boost to the Bureau of Reclamation to address a severe drought in the Colorado River basin.
Democrats are using a fast-track budget process to bypass Republicans, who are united in opposition to the bill and who say its tax increases and spending could worsen inflation and a looming recession.
“Hundreds of billions of dollars in tax hikes during a recession will kill jobs,” Senate GOP leader Mitch McConnell said Saturday on the Senate floor. “The American people don’t want hundreds of billions of dollars in Green New Deal waste.”
Democrats responded with their own studies which show small inflation decreases over time due to the bill.
The fast-track process was activated when Democrats last August adopted a fiscal 2022 budget resolution with the goal of quickly enacting a $3.5 trillion measure with major changes to the social safety net and increased taxes on corporations and the wealthy.
Months of negotiations with Manchin collapsed in December when he walked away from a $2 trillion version of Biden’s agenda which would have provided paid family leave, expanded child tax credits, expanded Medicaid coverage, childcare subsidies and Medicare hearing coverage.
The budget process comes with certain procedural quirks, including giving Republicans the chance to offer unlimited amendments in what’s known as a vote-a-rama. The GOP has promised to make the process of passing the bill this weekend “hell,” and Democrats expect to stay in session overnight to tire out the opposition and discourage further amendment votes.
Democrats said they are hoping that Republicans will not use all 10 hours of debate they are entitled to on Saturday and refrain from other procedural delays. GOP tactics will determine whether final vote occurs late Saturday, on Sunday, or later. Sunday is seen as the most likely.
Passage of the bill would be a major victory for Biden, even though he played a more limited role in the final talks than he did last year when trying to secure passage of a much larger version of the bill.
It would also be a coup for Schumer after the Biden agenda appeared entirely stalled by party infighting this spring. Schumer cited a series of recent legislative victories, including passage of a new gun law, veterans health benefits and a bill boosting US semiconductor manufacturing.
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