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Biden signs major climate, health care and tax bill into law

President caps off slew of legislative wins

President Joe Biden gives Sen. Joe Manchin III the pen he used to sign the Inflation Reduction Act, alongside Senate Majority Leader Charles Schumer and House Majority Whip James E. Clyburn in the State Dining Room of the White House on Tuesday.
President Joe Biden gives Sen. Joe Manchin III the pen he used to sign the Inflation Reduction Act, alongside Senate Majority Leader Charles Schumer and House Majority Whip James E. Clyburn in the State Dining Room of the White House on Tuesday. (Drew Angerer/Getty Images)

President Joe Biden signed his party’s climate, tax and health care package into law on Tuesday, celebrating that key planks of his domestic agenda finally made it across the finish line with congressional Democrats at his side.

“With unwavering conviction, commitment and patience, progress does come. … And when it does like today, people’s lives are getting better, their future becomes brighter and the nation can be transformed,” Biden said during a ceremony in the White House State Dining Room.

West Virginia Sen. Joe Manchin III stood by Biden as he signed the bill, along with Senate Majority Leader Charles E. Schumer, D-N.Y., House Majority Whip James E. Clyburn, D-S.C., and Reps. Frank Pallone Jr., D-N.J., and Kathy Castor, D-Fla., while some of Biden’s Cabinet members were in the audience.

The signing ceremony served as a victory lap for both Joes, as Manchin won special praise from both Biden and Schumer and the president handed Manchin the pen he used to sign the bill into law. Manchin had held off on backing a bill for more than a year before striking a final deal to support a slimmed-down package.

The West Virginia Democrat returned the praise, telling reporters outside the White House that a bill that significant couldn’t have gotten done without the president’s support.

Biden hinted at the long path to get to party unity on a Democratic package that passed the evenly divided Senate through the budget reconciliation process to skirt a Republican filibuster.

“And now I’m going to take action I’ve been looking forward to doing for 18 months,” he said as he prepared to sign the measure.

Biden’s agenda

The moment marked a significant milestone for Biden, who’d pitched his “Build Back Better” agenda to Congress then spent months urging Democratic lawmakers to deliver on key planks of his vision. Some of those priorities failed to win the support of Manchin or Arizona Sen. Kyrsten Sinema, a fellow centrist who rejected a series of tax increases.

While Democrats hold control of the White House and both chambers of Congress, Democrats’ tenuous grip on the Senate — which has a 50-50 split, with Vice President Kamala Harris delivering the tie-breaking vote — complicated the party’s efforts to pass a bill.

Manchin in December announced he wouldn’t back the $2.2 trillion version of the legislation that House Democrats passed, and talks ground to a halt as his relationship with the White House reportedly soured. Manchin said he returned to the negotiating table out of concern for U.S. energy security, particularly amid Russia’s invasion of Ukraine. Still, talks went hot and cold for months until he cut a surprise deal with Schumer for what made up the bulk of Democrats’ final bill.

It won the vote of every Democrat in Congress, even though the party’s progressive wing had hoped for a more expansive package that would have cost as much as $6 trillion. Republicans marched in lockstep against the bill, saying tax increases and additional spending would spur more inflation and trigger a recession.

The package that Biden signed into law spends more than $450 billion to address climate change, promote U.S. energy production and lower health care costs, primarily by extending subsidies for another three years for buying health insurance on marketplaces created under the Obama administration’s health care overhaul.

Biden campaigned on a promise to address climate change, and some independent experts say the Democrats’ package would put the United States within “striking distance” of his goal of cutting U.S. greenhouse gas emissions in half by 2030, compared with 2005 levels. That’s due to initiatives such as a $270 billion package of clean energy tax credits and a fee on methane emissions from oil and gas sites.

The package is estimated to cut the federal deficit by about $300 billion over the next decade, thanks to revenue raisers that include a 15 percent minimum tax on the largest corporations, a 1 percent tax on companies’ stock buybacks and measures to lower prescription drug costs for seniors. The legislation also adds almost $80 billion to the IRS budget over 10 years to ramp up tax collection.

Manchin on Tuesday addressed Republican criticisms of the bill, saying he’ll make sure that “the IRS doesn’t harass anybody” and that there’s no overreach by the Environmental Protection Agency. While the nonpartisan Congressional Budget Office found the bill’s immediate impact on inflation would be “negligible,” Manchin said its deficit reduction, investments in increasing U.S. energy production and measures to bring down drug costs would help Americans facing inflated costs.

Electric vehicle credit

Among the first provisions of the new law to take effect is a requirement that electric vehicles have final assembly take place in North America for consumers to be eligible for tax credits. Treasury officials confirmed Tuesday that the requirements will not be in effect for vehicles for which a binding contract was in place ahead of Biden’s signing the law Tuesday.

Consumers will be able to access an Energy Department website with vehicles that are expected to qualify for the $7,500 tax credit for model years 2022 and 2023, although there may be some exceptions, so the Department of Transportation is launching a tool for checking vehicle identification numbers.  

The White House is planning a celebration of the bill’s enactment for Sept. 6, when lawmakers are scheduled to return to town from their August recess. In the meantime, Biden plans to travel across the U.S. to highlight the law, as Democrats attempt to sell voters on their legislative achievements in the critical months before November’s midterm elections.

During Tuesday’s ceremony, Biden and fellow Democrats touted their legislative wins and what they described as a particularly productive summer. Biden pointed to his party’s $1.9 trillion COVID-19 relief package and the bipartisan infrastructure, gun safety, veterans health and disability benefits and semiconductor manufacturing and science laws.

“We are in a season of substance,” Biden said.  

Niels Lesniewski contributed to this report.

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