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Biden discusses Democrats’ health care, tax and climate proposal as recession fears grow

Washington — President Biden is delivering remarks Thursday on the new health care, tax and climate package unveiled by Senate Majority Leader Chuck Schumer and Sen. Joe Manchin, following news that the U.S. economy contracted for the second consecutive quarter.

“Simply put, the bill will lower health care costs for millions of Americans and it will be the most important investment, not hyperbole, the most important investment that we’ve ever made in our energy security,” Mr. Biden said in remarks from the White House, adding it’s a “big deal.”

Called the Inflation Reduction Act, the plan was announced by Schumer and Manchin on Wednesday, capping months of negotiations between the two Democrats that, until now, failed to yield a deal. While Manchin had previously expressed concerns about new federal spending amid historic inflation, the West Virginia Democrat said he believes this legislative proposal will address the jump in consumer prices by paying down the national debt and lowering health care and energy costs.

The bill provides $369 billion for energy and climate programs over the next decade, and is estimated to reduce the federal deficit by $300 billion, according to a summary of the plan released by Senate Democrats. It will also raise roughly $313 billion by imposing a 15% corporate minimum tax on large companies, as well as another $124 billion from tax enforcement by the Internal Revenue Service.

The plan also allows Medicare to negotiate prescription drug prices and extends expanded Affordable Care Act subsidies through 2025.

While more narrow than the initial sweeping domestic policy plan put forth by Mr. Biden last year, which stalled in the Senate after talks between Manchin and the White House derailed in December, the president expressed his support for the new plan and urged swift passage by the Senate and House.

The deal on the spending package provides a jolt to Mr. Biden’s domestic policy agenda as Democrats work to maintain their hold of the House and Senate in the November midterm elections. But Republicans have castigated the new plan, claiming it will increase taxes and lead to job losses. 

Likely adding to GOP lawmakers’ criticism of the proposal are latest figures from the Commerce Department showing the nation’s gross domestic product fell at an annual rate of 0.9%, marking the second quarter in a row of declining economic activity.

The contraction is fueling concerns the U.S. is on the brink of a recession, though Mr. Biden sought to downplay fears about an economic downturn, saying in a statement it’s “no surprise that the economy is slowing down,” given last year’s economic growth.

The president said the nation is “on the right path and we will come through this transition stronger and more secure.”

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