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Sen. Joe Manchin announced Wednesday that he came to an agreement with Senate Majority Leader Chuck Schumer on a reconciliation bill, after more than a year of negotiations among Democrats.
Manchin, D-W.Va., frustrated Democrats for months, consistently refusing to support party-line legislation that at one point Democrats wanted to cost over $3 trillion. Democrats termed that legislation “Build Back Better,” and Manchin shut down negotiations on it late last year.
But with Democrats grasping for a legislative win ahead of the midterms, Schumer, D-N.Y., kept up talks directly with Manchin through the spring and summer. In a lengthy statement, the moderate senator said Wednesday those talks resulted in a deal for a slimmed-down bill that includes tax, climate and prescription drug provisions.
Sen. Joe Manchin, D-W.Va., announced Wednesday that he and Majority Leader Chuck Schumer, D-N.Y., reached a deal on a tax and spending deal they plan to pass via reconciliation. (Anna Moneymaker/Getty Images)
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“For too long, the reconciliation debate in Washington has been defined by how it can help advance Democrats political agenda called Build Back Better,” Manchin said. “Build Back Better is dead, and instead we have the opportunity to make our country stronger by bringing Americans together.”
Democrats are using a process called budget reconciliation to advance the legislation, which allows them to get around the Senate filibuster with just 50 votes. As long as all Democrats avoid catching COVID-19 and are present and able to vote for the bill, they likely have the votes to get the legislation across the finish line.
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Manchin said in his statement that the bill will have a minimum 15% tax on companies worth more than $1 billion and invests in several forms of energy, including fossil fuel, nuclear and renewables. This is on top of agreements Democrats previously came to on prescription drugs and extending subsidies included in the Affordable Care Act (ACA).
Senate Majority Leader Chuck Schumer of N.Y., negotiated directly with Sen. Joe Manchin, D-W.Va., for months on a slimmed-down reconciliation deal. (AP Photo/Mariam Zuhaib)
“I now propose and will vote for the Inflation Reduction Act of 2022. Rather than risking more inflation with trillions in new spending, this bill will cut the inflation taxes Americans are paying, lower the cost of health insurance and prescription drugs, and ensure our country invests in the energy security and climate change solutions,” Manchin said.
“President Biden, Leader Schumer and Speaker Pelosi have committed to advancing a suite of commonsense permitting reforms this fall,” he also said.
According to Schumer’s and Manchin’s offices, the bill will raise $739 billing in revenue through IRS tax enforcement, the corporate minimum tax, IRS tax enforcement and closing the carried interest loophole. It will spend $433 billion total, they said, on energy and climate change provisions and on the ACA extension.
Manchin and his opposition to Democrats’ expensive reconciliation proposals frustrated liberal Democrats for months. But at least one progressive said Wednesday she is happy with the Manchin deal.
Sen. John Cornyn, R-Texas, backed a GOP move to block a Senate China bill while Democrats were still pursuing a reconciliation bill. But hours after the Senate passed the China bill, Democrats announced a reconciliation deal and said they plan to move ahead with it. (Photo by Brandon Bell/Getty Images)
“It makes me very hopeful that Senator Manchin is announcing a deal,” said Sen. Elizabeth Warren, D-Mass., when asked if she was confident reconciliation was actually moving forward.
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Republicans, meanwhile, criticized the deal, which was announced just hours after the Senate passed a bill on competition with China. Senate Majority Leader Mitch McConnell, R-Ky., had threatened to kill the China bill if Democrats continued to move forward with reconciliation.
“Senate Democrats can change the name of Build Back Broke as many times as they want, it won’t be any less devastating to American families and small businesses,,” Sen. John Cornyn, R-Texas, said. “Raising taxes on job creators, crushing energy producers with new regulations, and stifling innovators looking for new cures will only make this recession worse, not better.”
“With inflation at a 41-year high and a looming recession, Democrats want higher taxes, more government spending, and to attack American energy,” Senate GOP Conference Chair John Barrasso, R-Wyo., added. “So much for helping American families.”
This is a developing story, please check back for updates.
