The Democratic senators agreed to a spending package titled the “Inflation Reduction Act of 2022.” The bill proposes to increase taxes on billion-dollar companies, spend $369 billion on climate and energy programs, and extend health care subsidies for Affordable Care Act users for three more years, according to The Wall Street Journal.
In recent weeks, Manchin shot down Democrat attempts at pushing through Biden’s agenda, and reportedly told Democratic leaders he would “unequivocally” refuse to support legislation related to climate change and tax increases.
Now, the West Virginia senator claims reconciling with Democrats on this package will help the country fight inflation.
“We must be honest about the economic reality America now faces if we want to avoid fanning the flames of inflation,” Manchin said in a statement Wednesday. “At its core, the purpose of reconciliation is to get our economic and financial house in order. Contrary to foolish talk otherwise, America cannot spend its way out of debt or out of inflation.”
The revival of Biden’s agenda comes as the president has faced mounting criticism from his own party for failing to implement significant policy over his first year and a half in office. Democrats will use the budget reconciliation process to bypass the Senate filibuster and advance the bill along party lines, potentially giving the party a much-needed legislative victory before a midterm election where Democrats are expected to face a “red wave.”
To pass the package, Democrats still might need to convince Sen. Kyrsten Sinema (D-AZ), who has voiced opposition to elements of Biden’s spending agenda. Axios reported that hours after Manchin’s surprise reversal, a spokesperson for Sinema said the Arizona senator did not have a comment on the bill because “she will need to review the text.”
In Manchin’s statement, he criticized Democrats for previously attempting to spend trillions of dollars on Biden’s “Build Back Better” agenda as the country grapples with inflation. While the new package is a large cut from Democrats’ initial proposals of over $3 trillion, the Manchin-Schumer deal includes elements that the senator had previously opposed. Manchin did not provide specific details on what changed his mind.
Manchin’s agreement to the package he touts as an inflation-fighting bill comes a day before GDP numbers will be released for the quarter. Experts predict the report will show a second consecutive negative GDP report, meaning the country will be in a recession.
A joint statement from Manchin and Schumer claimed the package would “fight inflation, invest in domestic energy production and manufacturing, and reduce carbon emissions by roughly 40 percent by 2030,” Politico reported.