So What's in Biden’s $1.75 Trillion ‘Care Economy’ Bill the House Just Passed?
21:01 GMT 19.11.2021 (Updated: 21:02 GMT 19.11.2021)
Months of grinding negotiations finally yielded some progress on Friday as the US House of Representatives passed the Build Back Better Act (BBBA), a $1.75 trillion bill packed with social programs that are key to US President Joe Biden’s post-Covid economic recovery agenda. Many are wondering: what sort of programs are in this massive bill?
Biden has billed the BBBA as addressing the “care economy,” in contrast to the Infrastructure Investment and Jobs Act, which he signed into law on Monday. While House negotiations were done in close consultation with the Senate in order to ensure a quick passage, the upper chamber must still debate and vote on it before it can go to Biden’s desk.
The bill’s much-touted price of $1.75 trillion is spread over 10 years and Democrats have claimed that tax increases on wealthier Americans and on corporations will pay for the bill’s cost. However, a Congressional Budget Office report released on Thursday found the proposed revenue sources would only yield $1.5 trillion over 10 years, leaving a $250 billion deficit.
When the bill was passed on Thursday evening, House Minority Leader Kevin McCarthy (R-CA) denounced it as “the single most reckless and irresponsible spending bill in our nation’s history.”
Fighting Climate Change
The bill sets aside $555 billion to help halve US carbon emissions by 2030, in line with goals set by Biden at climate summits over the past year.
That includes $320 billion in tax credits for companies and consumers that install solar panels, improve buildings’ energy efficiency, or purchase electric vehicles, and financial incentives for manufacturing clean energy tech like wind turbines and solar panels. It would also create a Civilian Climate Corps to provide some 300,000 jobs restoring forests and wetlands and to guard against the effects of rising temperatures, analogous to the New Deal-era Civilian Conservation Corps.
The BBBA would spend $165 billion on expanding affordable health care, which the White House calls the biggest expansion of affordable health care since the Affordable Care Act (ACA), also called Obamacare, was passed in 2009.
The changes it would usher in include expanded Medicare coverage to include hearing benefits, reducing premiums on health insurance obtained through the ACA by $600 per year, and closing the Medicare coverage gap for people barred from getting Medicaid by their state governments.
© REUTERS / LEAH MILLISU.S. Senator Joe Manchin (D-WV) makes his way through a crowd of Capitol Hill reporters outside the U.S. Capitol in Washington, U.S., September 30, 2021
U.S. Senator Joe Manchin (D-WV) makes his way through a crowd of Capitol Hill reporters outside the U.S. Capitol in Washington, U.S., September 30, 2021
© REUTERS / LEAH MILLIS
The bill also introduces restrictions on annual price increases by drug makers and sets an annual limit on out-of-pocket spending on drugs that have been on the market for more than 10 years at $2,000 per year. One major effect of the change would be to cap the price of insulin, which is used to treat diabetes, at just $35 for a month’s supply. The drug’s price has risen dramatically in recent years, hitting $450 a month in 2019.
The bill also provides $150 billion to expand Medicaid’s home care program and reduce its massive waitlist.
A major section of the bill concerns a slew of social programs that would benefit families and workers which are intended to encourage parents to return to work amid a marked shortage of workers.
The bill put $400 billion toward a universal pre-K program for all three-and-four-year-olds in the country, at a public school or childcare program of their parents’ choice. According to the legislation, families with a combined annual income of less than $300,000 would pay no more than 7% of their income on child care for children under the age of six.
Another $200 billion is set aside for a one-year extension of the child tax credit program introduced during the COVID-19 pandemic. The deal would give parents $300 per month per child under the age of six and $250 per month per child between the ages of six and 17. Poorer families will also be eligible to receive the program longer.
The bill would use $200 billion to provide 4 weeks of federal paid family and medical leave to workers who, beginning in 2024, would be able to receive up to 90% of their income during the leave period. That amount is lower for higher earners.
Expanding Affordable Housing
The bill would use $150 billion to build more than 1 million new affordable rental and single-family homes, and provide rental and down payment assistance through an expanded voucher program.