Two weeks after Senator Joe Manchin (D-W.V.) pulled the plug on a climate change bill that offered $300 billion in tax credits to fund clean energy sources, he and Senate Majority Leader Chuck Schumer (D-N.Y.) have reached an agreement to revise its effects. The basic summary of this revised bill is that it would raise $739 billion in tax revenue that will go towards funding climate provisions and paying down $300 billion in the federal deficit.
This sudden development has sent shockwaves through the Senate, with senators across both sides of the aisle chiming in with their own opinions. Senator Chris Murphy (D-Conn.) described it as, “...somewhere between a surprise and a shock.”
Senator John Cornyn (R-Texas) showed more upset at the bill, deriding the development and claiming that the agreement was a “stunt” while also stating that several Democrats assured him that “tax and climate provisions were off the table”.
Motions for the new bill, titled the Inflation Reduction Act of 2022 (IRA), began on July 18th, with Manchin and Schumer properly reigniting discussions the following day. Discussions concluded by Tuesday to pass the bill through the Senate before its members take their summer recess on August 6th.
Several changes in the agreement included shaving between $400 billion to $500 billion in revenue-producing tax reforms, setting a 15% corporate minimum tax on companies whose profits exceed $1 billion, and strengthening the IRS’s tax compliance enforcement.
Manchin described the process as his staff writing the bill before sending it over to Schumer’s staff to review before the two began negotiations. This process lasted until the agreement reached its conclusion on Tuesday. The senator also clarified that President Joe Biden was not involved, citing how it was unfair to bring him in and did not want to get him involved in case the talks fell apart.
Outside of the Senate, reactions to the revived bill have been mostly positive. Figures such as Jesse Jenkins, leader of Prinston University’s REPEAT Project whose goal is to analyze the impact of government climate action, feel incredibly optimistic about the new bill. He mentioned that it keeps people in the climate fight even if it doesn’t achieve everything alone.
Communications director of the Rhodium Group Maggie Young shares a similar feeling of optimism, stating that the U.S. could potentially reduce emissions by 31%-44% below levels in 2005 by 2030.
Not all are pleased with this bill, however, with Brett Hartl, government affairs director at the Center for Biological Diversity, deriding its provisions for oil and gas drillings on public lands and offshore waters. He cited it as being a blow for communities that live nearby areas that can potentially be affected.
CEO of oil lobbying group American Exploration and Production Council Anne Bradbury expressed concern for the bill, citing the potential negative impact on energy prices and American competitiveness while the world is experiencing an energy crisis and record high inflation rates.
Unless it passes, the IRA’s full effects are yet to be known, but if it does, it would signal a shift in US policy that focuses more on funding clean energy. Oil interests still hold back its potential, but climate activists see this direction as preferable to having no bill at all.
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