Advertisement
begin quote from:
$555bn in climate action but no new tax on billionaires: what’s in Biden’s plan?
President’s $1.75tn spending framework includes investments in childcare and healthcare, but 12 weeks of paid family leave is out
Joe Biden on Thursday released the framework of a $1.75tn social and climate spending proposal after weeks of fraught negotiations with congressional Democrats.
The framework includes investments in childcare, climate change mitigation and an expansion of healthcare, but it is a significantly pared-down version of the original $3.5tn agenda Biden had proposed.
In a statement, the White House said the president is confident this framework of the bill would be able to pass the House and Senate, although it appears negotiations on the proposal’s specific details will continue.
Here is what we know so far:
What’s in the bill?
The bill includes substantial investment in young children, specifically funding for childcare and early childhood education. Under the proposal, most American families will save more than half of their spending on childcare, with bolstered benefits to working and low-income parents. It also includes universal pre-school for children aged three and four.
A hallmark of the proposal’s climate mitigation plan is $555bn to reduce climate pollution and invest in clean energy. The proposal includes consumer rebates for Americans who invest in renewable energy, for example installing rooftop solar panels or buying an electric vehicle.
The bill also includes incentives to expand renewable energy in the domestic supply chain, an accelerator program that will fund sustainability projects and funding for restoration and conservation efforts.
The framework includes some provisions to bolster healthcare, including reducing healthcare premiums and tax credits to people who have been locked out of Medicaid because their state refused to expand Medicaid access. It will also include investments in affordable housing and an extension of the child tax credit.
What was taken out?
A few provisions that some Democrats were heavily advocating for were left out of the framework.
Most notably, the proposal does not include 12 weeks of paid family leave. Senator Joe Manchin of West Virginia was the primary holdout for the provision. Manchin has indicated that he believes a reconciliation bill – which would require only the support of Democrats in the Senate – is “not the place” for “a major policy”.
Significant expansions to healthcare were cut out of the framework, including provisions to have Medicaid cover dental and vision costs, a plan to expand Medicaid to Americans in states that have refused to expand it themselves under the Affordable Care Act, and a proposal to empower Medicare to negotiate prescription drug prices.
Biden’s plan for free tuition at community colleges was also left out.
The framework notably does not include the “billionaire tax” that was floated by some Democrats on Wednesday before it was swiftly killed by centrist holdouts.
The billionaire tax would have seen a complete shift in the way Americans worth more than $1bn would pay taxes, targeting the billions of dollars in shares they own in their companies. Hours after the proposal was unveiled, Manchin said he would not support such a provision.
How are Democrats planning to pay for it?
Biden estimates the framework will cost about $1.75tn, and the White House says the bill will be funded “by asking more from the very largest corporations and the wealthiest Americans”.
A central provision in the bill’s payment plan is shifting the corporate tax rate to 15% for corporations with more than $1bn in profits. While the current corporate tax rate is 21%, Democrats have agreed that loopholes allowed corporations to report lower profits to the Internal Revenue Service (IRS) while boasting lofty profits to shareholders. The next tax rate will apply to the profit that is reported to shareholders.
The bill also includes a surtax on the 0.02% wealthiest Americans and investments in IRS auditing enforcements.
What’s next?
The framework released by Biden on Thursday represents a broad outline of what will end up in the final bill. Congressional Democrats will need to get to work at drafting the actual legislation if everyone, particularly the party’s most progressive and conservative members, can agree on the basic framework. When that will happen will depend on how quickly everyone says they are on board.
No comments:
Post a Comment