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With the House and Senate both out for the August recess, this edition of Policy Matters rounds up recent major developments and looks ahead to what remains on the 2022 agenda in D.C.
Inflation Reduction Act
In the “will-they-or-won’t-they” moment of this Congress, Senate Democrats negotiated and both chambers passed the sweeping Inflation Reduction Act (IRA). The legislation includes much of the Biden-Harris administration’s domestic policy agenda – spanning climate, health care and tax reform, while aiming to reduce the national deficit.
Among the bill’s provisions:
CLIMATE: Makes $369 billion of historic investment in clean energy and efforts to counter climate change, including incentives for businesses to use lower-carbon/carbon-free energy sources; breaks for consumers and businesses to invest in clean energy solutions, including rooftop solar, heat pumps, small wind energy systems and some electric vehicles; creation of a green bank to incentivize development of clean energy technologies; and funding and grants for communities impacted by pollution. These measures are projected to reduce U.S. greenhouse gas emissions by 40 percent below 2005 levels by 2030, close to the goal President Biden set when he rejoined the Paris climate agreement. Read more from our team here.
HEALTH CARE: Secures long-pursued changes in health care, though largely limited to seniors enrolled in Medicare. It allows Medicare to negotiate the prices of some drugs starting in 2026; implements a cap on out-of-pocket drug costs at $2,000 for seniors on Medicare starting in 2025; caps insulin costs at $35 per month for Medicare recipients; and extends premium assistance for Americans enrolled in health plans through the Affordable Care Act for three years – relief that otherwise would have expired this year.
TAXES: Adopts a 15 percent minimum tax on corporations, raising as much as $313 billion, while incorporating some exemptions for manufacturing and capital investments; provides an additional $80 billion to the Internal Revenue Service (IRS) to boost enforcement and bring in more taxes from very wealthy individuals; and implements a 1 percent excise tax on corporate stock buybacks.
…While considered modest in its likely impact, the Bipartisan Safer Communities Act’s significance lies in bringing both parties to the table on an emotional, polarizing issue after decades of inaction…
Following the tragic shootings in Buffalo, N.Y. and Uvalde, Texas, a group of senators led by Sens. Chris Murphy (D-Conn.) and John Cornyn (R-Texas) brokered new national gun safety legislation that was passed by Congress and signed into law by President Biden at the end of June. While considered modest in its likely impact, the Bipartisan Safer Communities Act’s significance lies in bringing both parties to the table on an emotional, polarizing issue after decades of inaction. Among its provisions, it expands the national background check system for first-time gun buyers under age 21 to allow for checking juvenile and mental health records; allocates millions of dollars for state intervention programs, including red flag laws; strengthens laws around gun trafficking and straw purchases; and closes the “boyfriend loophole.” Some lawmakers continue to pursue further gun control legislation, with the House passing an assault weapons ban, but such measures stand little to no chance in the Senate.
Science and Technology
After months of attempted compromise between the House and Senate, Congress has passed and President Biden has signed into law the CHIPS and Science Act. The legislation is designed to bolster domestic semiconductor chip manufacturing and scientific research to compete with China. The bill includes $39 billion to “build, expand, or modernize domestic facilities” for chipmaking via grants to companies; $11 billion for research and development programs across semiconductor and related manufacturing technology; and a new Advanced Manufacturing Investment Credit, which creates a 25 percent tax benefit for new semiconductor manufacturing. It prohibits companies receiving these funds from “engaging in significant transactions in China or other countries of concern involving any leading-edge semiconductor manufacturing capacity or material expansions of legacy semiconductor manufacturing capacity designed to export to the U.S. and other countries.”
Ukraine Aid and NATO Expansion
Congress and the Biden-Harris administration continue to provide ongoing aid for Ukraine in its war with Russia, now entering its seventh month, with tens of billions of dollars in military, economic and government support, including training, equipment and other security assistance. Congress has readily passed this funding on a bipartisan basis. Most recently, the Senate – as the branch of government responsible for approving treaties – approved the expansion of the North Atlantic Treaty Organization (NATO) to include Sweden and Finland. President Biden signed the U.S. documents for ratification. The addition of these two countries further strengthens the international commitment to condemn and deter Russian aggression.
When Congress returns from recess after Labor Day, it will be a sprint to the midterms and a potentially challenging lame-duck session. The Biden-Harris administration will continue to advocate for additional funding to manage the COVID-19 pandemic and respond to the monkeypox outbreak, among other needs. Meanwhile, the Federal Reserve is expected to continue with interest rate increases and other monetary policy to lower inflation without increasing unemployment.
…Voters in as many as five more states will consider abortion rights on their ballots this November, including Kentucky, Michigan, Montana, Vermont and California – and more legislatures are expected to take up the issue…
Abortion and Other Personal Rights
Following the Supreme Court’s (SCOTUS) decision to overturn Roe v. Wade and return abortion policy to the states, the administration and Democrats in Congress have sought to codify the national right to an abortion, as well as other personal rights perceived to be future targets of the high court’s conservative majority. The House has passed – mostly along party lines – the Women’s Health Protection Act, the Respect for Marriage Act and the Right to Contraception Act. The bills face an uphill battle in the Senate, though a number of senators are working to negotiate compromise legislation on abortion access. President Biden signed an executive order on August 2 that seeks to ensure pregnant people can travel across state lines to receive abortions, even if abortion is not legal in their state.
State activity on the issue has started; notably, voters in Kansas overwhelmingly rejected a proposal to amend the state’s constitution to end the right to abortion in the state. Indiana became the first state to adopt an abortion ban following the SCOTUS decision, resulting in criticism from some of the state’s largest employers. Voters in as many as five more states will consider abortion rights on their ballots this November, including Kentucky, Michigan, Montana, Vermont and California – and more legislatures are expected to take up the issue.
January 6 Select Committee and Other Trump Administration Investigations
Following a summer of hearings, the Select Committee to Investigate the January 6th Attack on the United States Capitol continues its investigative work. Committee members, including Chair Bennie Thompson (D-Miss.) and Vice Chair Liz Cheney (R-Wyo.), have indicated they will resume hearings in the fall. A report on the committee’s findings is expected, but members are still weighing next steps, including any sort of criminal referral to the Department of Justice. The committee’s future is ultimately tied to the outcome of the midterms. At the same time, legal proceedings surrounding former President Trump, his family business and his administration continue, most notably with the Federal Bureau of Investigation (FBI) recently searching his Florida residence, Mar-a-Lago, related to extensive, highly classified documents removed from the White House.
Every year, Congress races to figure out how they will fund the government by the September 30 end of the current fiscal year. While the House has taken steps to pass its appropriations bills, the Senate has yet to reach agreement. As a result, a continuing resolution to avert a government shutdown appears increasingly likely – kicking the can until after the November elections. On a parallel track, Congress must also pass the National Defense Authorization Act (NDAA) by year’s end. Again, the House cleared their version of the bill, with a bipartisan majority supporting $839 billion in Pentagon spending – $37 billion more than the Biden-Harris administration sought. The Senate reportedly will consider NDAA in September.
Members in both the House and Senate continue to consider reforms to the Electoral Count Act, the 1887 law governing the process for counting Electoral College votes. The American Innovation and Choice Online (AICO) Act, a bipartisan antitrust bill aimed at major technology companies, remains on the to-do list, pending 60 votes and floor time in the Senate. And House Democrats are negotiating a policing bill, including funding for law enforcement urged by moderate Democrats.