Biden says government is working again as US Senate passes milestone climate change bill

By on 08/08/2022 | Updated on 08/08/2022
Close-up of US vice president Kamala Harris smiling.
Vice president Kamala Harris cast the deciding vote on the Inflation Reduction Act in the Senate, after the 50 Democrat senators backed it and the 50 Republican senators opposed. Photo by Gage Skidmore via flickr

Senators in the US voted through the night on Sunday to push through president Joe Biden’s Inflation Reduction Act – a major piece of legislation that allocates US$454bn to tackle climate change, subsidise healthcare and reform taxes – after nearly two years of wrangling.

The act’s key provisions include spending US$369bn on climate change measures, US$60bn of which will be spent on clean energy including solar and wind power; establishing a minimum 15% corporate tax rate on American companies, which is expected to generate US$739bn over the next decade; and the allocation of US$64bn to subsidise healthcare for those on low incomes and a US$2,000 annual cap on the cost of drugs for elderly Americans who receive Medicare.

“Today, Senate Democrats sided with American families over special interests, voting to lower the cost of prescription drugs, health insurance, and everyday energy costs and reduce the deficit, while making the wealthiest corporations finally pay their fair share,” Biden said. “I ran for president promising to make government work for working families again, and that is what this bill does — period.” 

Read more: US federal agencies publish first-ever plans to enhance equity and inclusion

He added that the bill “makes the largest investment ever in combatting the existential crisis of climate change” and that it would strengthen energy security, create jobs in solar panel, wind turbine and electric vehicle manufacturing, and “lower families’ energy costs by hundreds of dollars each year”.

It is hoped the Act will help the country reduce its domestic emissions by at least 40% by 2030, against a 2005 baseline.

Reworked and watered-down

The act is a spin-off of Biden’s flagship Build Back Better agenda – developed between 2020 and 2021 – which sought to make the largest nationwide public investments in social, environmental and infrastructure programmes since the Great Depression, and was initially estimated to cost US$3.5 trillion.

The associated act was passed by the House of Representatives in November last year but latterly quashed when Democrat senator Joe Manchin pulled his support.

Read more: Biden beefs up federal requirement to assess environmental impact of infrastructure after dilution by Trump

Subsequent negotiations resulted in the Inflation Reduction bill, a heavily reworked and watered-down piece of legislation. The bill was opposed by all 50 Republican senators – who make up half of the upper house – but passed 51-50 after vice president Kamala Harris exercised her casting vote.

After the vote, Harris said that the legislation was “an example of leaders leading” and said it showed a “willingness and the courage to actually step forward and fix the problems that the American people have a right to believe that their elected leaders will address”.

The bill is now expected to be passed in the Democrat-majority House of Representatives, which is scheduled to consider the legislation on 12 August, and could be on Biden’s desk for final sign off within weeks.

Read more: Biden’s 2023 budget boosts investment in federal workforce

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About Mia Hunt

Mia is a journalist and editor with a background in covering commercial property, having been market reports and supplements editor at trade title Property Week and deputy editor of Shopping Centre magazine, now known as Retail Destination. She has also undertaken freelance work for several publications including the preview magazine of international trade show, MAPIC, and TES Global (formerly the Times Educational Supplement) and has produced a white paper on energy efficiency in business for E.ON. Between 2014 and 2016, she was a member of the Revo Customer Experience Committee and an ACE Awards judge. Mia graduated from Kingston University with a first-class degree in journalism and was part of the team that produced The River newspaper, which won Publication of the Year at the Guardian Student Media Awards in 2010.

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