DANIEL ESTRIN, HOST:
Democrats have left Washington for the last few weeks of their annual summer break on a high note.
NANCY PELOSI: The motion is adopted.
(APPLAUSE)
ESTRIN: That's the sound of the House passing the history-making Inflation Reduction Act after more than a year of negotiations. The bill includes money to address climate change and increase domestic production of renewable energy, provisions to lower drug prices for millions of people, and an extension of some Affordable Care Act programs that were set to end. NPR congressional correspondent Kelsey Snell has been following this bill through its whole, entire journey. Good morning.
KELSEY SNELL, BYLINE: Hi. Good morning.
ESTRIN: So Democrats are celebrating the Inflation Reduction Act as a chance to address climate change, inflation, health care, corporate taxes. What exactly is in this bill?
SNELL: Yeah, this is a really big list of things that they're trying to do here that covers a lot of ground. Now, I should say this is a bill that is down from their early goals of passing $3.5 trillion dollars in spending. They have landed now on $700 billion. So this doesn't include things like child care and universal pre-K and paid family leave that Democrats originally wanted to pass here. But what it does do is it allows Medicare to negotiate directly on the cost of drugs, something that Democrats have wanted to do for a very long time.
They also have a goal of reducing emissions by 40%, and they plan to do that with about $369 billion in climate and energy security investments. And that includes tax credits for wind, solar and other renewable energy production and credits to develop new technology. There are also incentives for residential and commercial investment in energy efficiency. And a lot of that is offset by tax changes, including a 15% minimum tax on billion-dollar corporations and more IRS enforcement. But this is a less ambitious package than they originally planned to do.
ESTRIN: And so how quickly will most Americans be able to actually see these changes? Will any of it take effect soon enough to be a factor in November's midterm elections?
SNELL: Well, when it comes to reducing inflation - so, you know, the title of the bill - don't expect anything immediately. The nonpartisan Congressional Budget Office says the bill has a negligible effect on inflation between 2022 and into 2023. So, you know, that's not going to hit right away. Many of the clean energy and energy efficiency tax credits will be available immediately, so that will be quick. But other things, like the extended health care tax credits or the access to those expanded programs under the ACA, those just won't expire. So people aren't going to experience that as a new benefit; it's just making sure that they don't lose something that already exists. Though Medicare will start negotiating prescription drug prices at the start of 2023, those effects won't be noticed right away either. So a lot of that means that Democrats will have to figure out a way to explain the bill to people and make them feel it if they want it to be a factor in this upcoming election.
ESTRIN: OK. Now, this bill is substantially different from what President Biden promised when he announced his plan more than a year ago. How did Democrats reach this moment?
SNELL: Well, we should say Democrats did pass this bill entirely on their own. No Republicans in the House or Senate voted for this bill. And a lot of it was just legislative work, the way bills come together. They negotiated and worked on policies, many of which took years. And, you know, senators were far more willing to kind of come together on these long-term, big changes to policy when they had time to work it out together and through the committee process.
ESTRIN: NPR's Kelsey Snell, thanks very much.
SNELL: Thanks so much for having me. Transcript provided by NPR, Copyright NPR.
