President Biden signed into law a landmark tax, health and energy bill on Tuesday that will help him fulfill his goal of modernizing the American economy and reducing its dependence on fossil fuels.
The legislation will lower the cost of prescription drugs for seniors on Medicare, extend federal subsidies for health insurance and reduce the federal deficit. Electric utilities will be able to switch to lower-emission sources of energy and Americans will be encouraged to buy electric vehicles through tax credits.
It doesn't do anything to help workers earn more and enjoy the comforts of a middle-class life that Mr. Biden promised.
The inflation reduction act was signed by Mr. Biden in the State Dining Room at the White House. He and his allies said the legislation was a miracle because it took more than a year to get it done. Mr. Biden claimed victory as he signed the compromise bill that he said was the biggest step forward on climate ever.
The bill I am about to sign isn't just about today, it's about tomorrow. Mr. Biden said it was about delivering prosperity to families.
Administration officials say that Mr. Biden has passed more of his economic agenda than they could have hoped for, because of Republican opposition to much of his agenda. His wins include a $1.9 trillion economic rescue plan last year designed to get workers and businesses through the pandemic and a pair of bipartisan bills aimed at American competitiveness: a $1 trillion infrastructure bill and $280 billion in spending to spur domestic Semiconductor manufacturing.
One of Mr. Biden's main economic goals is to invest in workers, families, students and other people.
Mr. Biden wants a more assertive federal government to speed economic growth and make sure its spoils are shared.
Mr. Biden considers investment in low-emission energy sources and advanced manufacturing critical to American businesses and the nation's economic health.
Human investment is important. Restaurants and medicine make up the majority of the American economy. The recovery from the recession has been hampered by a lack of support for some workers. The cost and availability of child care alone is keeping many potential workers out of the workforce.
The auto industry is large. There was a limit on the number of cars that could be eligible for tax credits for buying an electric vehicle. The tax credit will be extended until 2032, and used cars will be able to get a credit of up to $4,000.
The energy industry is important to us. Billions of dollars will be given to Americans who purchase energy efficient and electric appliances. Tax credits will be given to companies that build new sources of emissions-free electricity. $60 billion is set aside to encourage clean energy manufacturing and penalties for methane emissions that exceed federal limits.
It's health care. Medicare will be able to negotiate with drugmakers on the price of some prescription drugs. The law extends the subsidies that are available under theAffordable Care Act for three more years.
There is a tax code Companies that report more than $1 billion in annual income can use credits, deductions and other tax treatments to lower their tax rates under the new law. An investment of about 80 billion will be made by the legislation.
Communities with low incomes. The package supports low-income communities and communities of color that are disproportionately affected by climate change. Grants for zero-emissions technology and money to mitigate the negative effects of highways are included.
The industry is made of fossil fuels. The legislation requires the federal government to expand tax credits for coal and gas-burning plants that use carbon capture technology. These provisions were added in order to get the support of Senator Joe Manchin III.
West Virginia is located in the United States. The law is expected to benefit Mr. Manchin's state, which is the nation's second largest producer of coal, making permanent a federal trust fund to support miners with black lung disease and offering new incentives to build wind and solar farms in areas where coal mines or coal are located
Mr. Biden has not been able to deliver on many of the programs he proposed to help Americans balance work responsibilities with care for children or elderly parents. He wasn't able to get free community college tuition. The tax credit meant to fight child poverty was not supported by the government. His plan to spend hundreds of billions of dollars to expand and improve home health services for seniors and disabled people has foundered.
Liberal economists say there is a missed opportunity to help Americans work more and earn more, and to make the economy run more efficiently.
Lindsay Owens, executive director of the liberal Groundwork Collaborative in Washington, said that Mr. Biden has been able to get Democrats and some Republicans to invest in the physical economy and embrace a more interventionist view of federal power. She said that he has moved to an economic system and an economic agenda where the government is throwing its weight around.
We didn't get the care agenda That is a huge missed opportunity. Our economy is not going to be strong until we have affordable child care.
The agenda that Mr. Biden packed into his "American Families Plan" always faced a harder path than his "American Jobs Plan." The bipartisan path that Mr. Biden won on was ruled out by the Republicans. Joe Manchin III of West Virginia was one of the Senate Democrats who wanted Mr. Biden to limit the scope of the bill.
Mr. Biden had promised to reform the tax code to reward work, not wealth, but he was forced to back away from that promise. He did not propose raising top marginal income tax rates for high earner, or taxing investment returns for millionaires at the same set of rates as income earned from wages, which he had promised would reduce economic inequality.
New taxes on big corporations are projected to increase taxes by around $300 billion. A minimum tax on large firms that use deductions and other methods to reduce their tax bill is included in the law. It increases funding for the IRS in order to crack down on tax evasion and collect hundreds of billions of dollars that are owed to the government but not paid by high earners and corporations.
Mr. Biden initially offered to fund his agenda by raising taxes on corporations and high-income individuals.
Steve Rosenthal is a senior fellow in the Urban-Brookings Tax Policy Center in Washington. What he accomplished was significant.
Ben Harris is the assistant secretary for economic policy in the Treasury Department.
The work-not-wealth emphasis was central to the president's campaign and he got a lot of wins out of it.
Some officials defend Mr. Biden's achievements, which include securing some long-promised programs that are popular with voters but struggle to pass in Washington. The bills he has signed attempt to use federal purchasing power to drive up wages.
The policy director for Mr. Biden's 2020 campaign said that "every piece of the puzzle is designed in a way to empower workers, empower individuals across the country to make a good Living Wage."
The bill Mr. Biden signed invests $370 billion in spending and tax credits in low-emission forms of energy. The goal is to help the United States cut greenhouse gas emissions by at least 40 percent. Mr. Biden wants the country to cut emissions by at least 50 percent over that time period.
It extends federal health insurance subsidies, allows the government to negotiate prescription drug prices for seniors on Medicare, and is expected to reduce the federal budget deficit by $300 billion over the next decade. The health components are important to millions of workers, and the climate components will create high-paying union jobs in an emerging clean-energy economy, according to the administration.
The climate provision is an example of what Mr. Biden has not been able to deliver. In his American Jobs Plan, Mr. Biden called on Congress to create a civilian climate corps that would cost $10 billion.
The re-envisioned climate work force was part of a bill that passed the House in November.
The investment was made in workers. The package was left on the floor after Mr. Manchin walked away from it.
Mr. Manchin, who hails from a coal state, signed on to a wide range of other climate provisions. Mr. Manchin stood behind Mr. Biden as he signed the bill into law.
Mr. Biden said he never had doubts.
Michael D. Shear was one of the contributors.
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