The United States House of Representatives has passed President Joe Biden’s landmark $1.75 trillion Bill to boost the social safety net for Americans and fight climate change – a crucial element in his domestic agenda.
However, the initiative still faces a major challenge in securing sufficient support in the US Senate before it can become law.
Mr Biden said on Friday after the House vote that the legislation – known as the “Build Back Better” Act, represented “another giant step forward in carrying out my economic plan to create jobs, reduce costs, make our country more competitive and give working people and the middle class a fighting chance”.
No Republicans supported the measure in the House of Representatives.
The vote had originally been expected to take place on Thursday but was delayed by a marathon 8½-hour speech by Republican minority leader Kevin McCarthy opposing the plan.
Mr Biden said key measures in the wide-ranging legislation would:
– reduce the costs of prescription drugs, healthcare and housing;
– improve childcare and care for older people to facilitate workers returning to the labour market;
– cut taxes for working families and the middle classes and extend measures aimed at reducing child poverty;
– provide universal pre-kindergarten for every three- and four-year-old in the US and make education beyond high school more affordable.
He said that, along with separate major infrastructure legislation, which he signed into law in recent days, the Build Back Better measures would make “the most significant investment in our fight against the climate crisis ever by creating jobs that build a clean energy future for our children and grandchildren”.
Republicans argued that the expansive social safety net package would constitute a “socialist” encroachment of the federal government into every aspect of American life. They also argued it would stoke inflation, which is currently at a 30-year high, while some elements would act as a disincentive to work.
Mr McCarthy described the legislation as the “single most reckless and irresponsible spending Bill in our nation’s history”.
Mr Biden contended that the Build Back Better Act was fiscally responsible.
“It reduces the deficit over the long-term. It is fully paid for by making sure that the wealthiest Americans and biggest corporations begin to pay their fair share in federal taxes. It keeps my commitment that no one earning less than $400,000 a year will pay a penny more in federal taxes.”
To raise revenue, the Bill would impose a new 15 per cent corporate minimum tax and a 5 per cent surtax on individual incomes over $10 million, with an additional 3 per cent tax above income of $25 million.
The non-partisan Congressional Budget Office estimated the Bill would raise federal budget deficits by $367 billion over 10 years, but that additional revenues from improved Internal Revenue Service tax collections could generate a net increase in revenues of $127 billion by 2031.
In an evenly divided Senate any defection by a Democrat could see the legislation defeated. It is expected that negotiations on the legislation in the Senate could see key changes introduced that would then have to go back to the House of Representatives for a further vote.
Separately on Friday, Mr Biden transferred power briefly to vice-president Kamala Harris while he was under anaesthesia for a routine colonoscopy, making her the first woman to hold presidential power in US history.
Mr Biden on Friday underwent his annual physical at the Walter Reed military hospital outside Washington.