The Inflation Reduction Act (IRA) passed at 3:18 pm EST on Sunday, August 7, 2022 with the anticipated partisan 51-50 votes and VP Kamala Harris breaking the tie. Part of the all-night event was the presentation of amendments to highlight the politics of the senators. Each senator was required read their amendment aloud from the Senate floor, and each side had only one minute to argue for or against the proposal before a vote. Amendments violating the Byrd Rule, requiring a non-tangential impact on spending, revenues or the debt limit, required 60 votes to pass them.
Two amendments passed of the 35 amendments and motions regarding the bill, most of them from Republicans who said they wouldn’t vote for the bill even if their amendments passed. Samples of failing amendments:
- Prohibiting the IRS from accessing its additional money in the bill until 90 percent of the agency’s employees were back to work in person. – Susan Collins (R-ME)
- Prohibiting the new IRS funds from audits of taxpayer incomes under $400,000 annually. – Mike Crapo (R-ID)
- Replacing the health and energy subsidies in the legislation with permanent, 100-percent bonus depreciation. – Pat Toomey (R-PA)
- Extending the $2,000 Child Tax Credit (CTC) as expanded under the Tax Cuts and Jobs Act (TCJA) which would cause at least one Democrat to vote against the IRA. – John Cornyn (R-TX)
- Blocking the Securities and Exchange Commission (SEC) from requiring companies to publicly disclose climate-related information. – Pat Toomey (R-PA)
- Opening up Outer Continental Shelf areas for energy exploration.
- Preventing migrants from entering the U.S. while awaiting asylum.
- Expanding health care benefits to Medicare dental, vision and hearing benefits because it would have lost too much revenue in this bill. – Bernie Sanders (I-VT) Requiring Medicare not to pay more for prescription drugs than the Department of Veterans. – Bernie Sanders (I-VT)
Republicans killed the cap on insulin costs for private insurance. In the U.S., insulin costs five to ten times as in other economically developed countries, and almost 80 percent with diabetes taking insulin says the cost creates financial difficulty. The GOP blocked a limit of insulin co-payments to $35 a month. Among likely voters, 61 percent strongly support the cap which still exists for those insured by Medicare insurance.
Democrats will likely use the GOP opposition to capping the cost of insulin for campaigning. Pennsylvania Lt. Gov. John Fetterman (D), a U.S. senator candidate, released this statement directed at his opponent, Mehmet Oz:
“Dr. Oz and his Republican friends in Washington want you to pay outrageous prices for lifesaving medications, like insulin. No one should have to ration the medication they need to survive.
“Insulin should be capped at $35 for everyone. Republicans just blocked that from becoming a reality.
“Dr. Oz won’t stand up to Big Pharma because he’s not only palled around with them and promoted their products on his shows, he’s also invested in the companies that are raking in billions while helping drive up costs and force families to ration insulin. When Oz’s Pharma CEO buddies make more cash, he makes more cash.”
Sen. Kyrsten Sinema (D-AZ) caused more problems to support her big businesses donors by backing a GOP amendment to protect businesses relying on capital investment from private equity groups from the 15 percent corporate minimum tax in the IRA. Other Democrats, some of them up for reelection this year, also voted for the amendment: Catherine Cortez Masto (NV), Maggie Hassan (NH), Mark Kelly (AZ), Jon Ossoff (GA), Jacky Rosen (NV), and Raphael Warnock (GA). Revenue would have come from a one-year extension of the 2017 tax law cut on state and local tax deductions (SALT), hitting residents of high-tax blue states such as New York, New Jersey, Connecticut, and California.
After that amendment passed, Mark Warner (D-VA) offered another amendment to replace the SALT cap extension with another tax provision raising revenue of $35 billion. Harris cast the vote to break the partisan tie. Revenue comes from companies required to declare income based on generally accepted accounting practices, stricter than required under current law allowing tax breaks and shelters shielding income from the IRS.
Even with the Democrats’ support to help big business, many will be paying more taxes. The 15 percent requirement is only for companies with annual average earnings over $1 billion or $100 million earned in the U.S. for foreign-owned businesses. Only 150 companies fit this category, i.e., Amazon, paying only six percent in federal taxes on its $35 billion in profits last year. With almost $30 billion profits last year, AT&T received $1.2 billion more in rebates than it paid in taxes. Bank of America, which didn’t benefit from accelerated depreciation, paid a three-percent federal tax from 2018 to 2019; FedEx, which accelerated depreciation for all its tax breaks, had a negative tax rate for that time period. This IRA provision may limit the extent of share repurchases to boost their stock prices and reward investors. Before the bill’s passage, Apple planned to buy back up to $90 billion in stocks this year, and Morgan Stanley and Nike announced $20 billion and $18 billion buybacks respectively.
The biggest surprise in the past week during the IRA public negotiations was the support of Joe Manchin (D-WV), who earlier said he would vote only for bipartisan bills. He tweeted his explanation of his change from his negative position:
“My R[epublican] friends have made clear they’re completely unwilling to support this bill under any condition. None of their amendments would change that. For this reason, I’ll vote to protect the integrity of the IRA regardless of the substance of their fake amendments.”
Democrats pandered to Manchin by abandoning provisions such as free prekindergarten for all and paid family and medical leave for workers nationwide while providing support for fossil fuels.
Although inflation won’t immediately drop to pre-COVID levels without the benefits of the Democrats initial Build Back Better plan, the IRA will help healthcare costs and fight the threat of climate change. It keeps insurance subsidies for the Affordable Care Act through 2025 to make this insurance more affordable for those who obtain their insurance through the healthcare marketplace. If these subsidies had sunset this year, as originally legislated, millions of people qualifying for free health insurance when Congress eliminated the income cap would have paid premiums.
According to Newsweek’s factcheck, IRA does not increase taxes for people earning less than $400,000, a common complaint from Republicans. Many economists agree the plan modestly reduces inflation in the long term and improves the federal government’s financial outlook. Jennifer Rumsey, CEO of Cummins specializing in advanced diesel and natural gas engines, said the bill would be “good for the economy and the environment.”
The only GOP criticisms of the bill seem to be their lies about increased taxes and inflation. The minute that people, who want the bill passed by almost three-fourths of the voters, benefit from its provisions, all the Republicans, who voted against it, will take credit for it—just as House Republicans did for the benefits of Biden’s and the Democrats’ massive infrastructure bill passed last November with only six GOP votes.
During the Senate marathon voting, Deposed Donald Trump (DDT) gave a 108-minute speech at the CPAC (Conservative Political Action Conference) summit that managed to out-fascist the Hungarian prime minister Viktor Orban. In DDT’s perception, his loss led the U.S. to out-of-control crime, inflation, and unemployment, which he stated at three times more than the existing 3.5 percent. He said his doctor, Ronny Jackson who was fired for his drinking on the job and other misbehaviors, “loved to look at my body. It was so strong and powerful.” Jackson is now a U.S. representative from Texas.
After introducing the QAnon trio in the House—Matt Gaetz (FL), Lauren Boebert (CO), and Marjorie Taylor Greene (GA)—he said they needed “to deal with the radical left socialist lunatic fascists.” Michael Hardy, senior editor at the Texas Monthly, said DDT’s criticism about Biden surrendering “our strength” had “echoes of the Nazi ‘stab in the back theory’ of losing WW1.” The lines about “blood of innocent victims” in “Democrat-run cities [sic]” compared to “literal blood-and-soil rhetoric.” DDT called for a military takeover of San Francisco, New York, Chicago, and Portland. Hardy said:
“Trump’s rhetoric is significantly more extreme than even a few years ago. This might be most frightening speech I’ve ever heard. Full-on, unapologetic fascism. Trump has either been reading Mein Kampf or having someone read it to him.”
As usual, DDT dwelled on his lies of election fraud, attacked LGBTQ people, and teased a 2024 presidential return. He also joined the other speakers in defending insurrectionists while threating violence. DDT presented his policies of a police state: about the opposing party, “we have to hit them very, very hard, it has to be a crippling defeat.” He plans to use the National Guard to gun down Black, immigrant, and left-wing workers—anyone brave enough to demonstrate for democracy—with no approval of state governors.
The next two elections will provide a path for the United States into one of two directions—fascism or democracy.