‘It’s a big deal’: Biden throws support behind ‘historic’ Inflation Reduction Act after Manchin and Schumer unveil agreement

President Joe Biden on Thursday hailed the Inflation Reduction Act, the $433bn reconciliation package negotiated by West Virginia Senator Joe Manchin and Senate Majority Leader Chuck Schumer, as an “historic agreement to fight inflation and lower costs for American families” and offered his full support for the bill.

Speaking from the State Dining Room in the White House, Mr Biden said the proposed legislation will cut heath care costs for “millions of Americans” and make the “most important investment” the US has ever made in “energy security,” and “begin to restore fairness” to the US tax code.

“It’s a big deal,” he said.

The agreement brokered between Mr Manchin and Mr Schumer came hours after the Senate passed new legislation to strengthen American semiconductor manufacturing. Senate Republicans had vowed to block consideration of the semiconductor bill if the Democratic majority moved forward on a different spending package floated by a group of senators, but 14 GOP senators joined the 50 Democrats in passing the bill after Mr Manchin publicly declared his opposition to the measure.

But the West Virginia senator’s pushback on that prior legislation, which he claimed was due to its climate provisions, appeared to be a feint aimed at getting Republicans to push the semiconductor bill through. Mr Manchin announced late Wednesday that he and Mr Schumer had come to an agreement on the contents of the Inflation Reduction Act, which is tailored to fit Senate “reconciliation” rules that will allow it to pass with just 51 votes — all 50 Democrats plus Vice President Kamala Harris.

Mr Manchin previously scuttled other attempts to move Mr Biden’s signature legislation, formerly known as Build Back Better, through the upper chamber, citing the need to combat inflation. But in his announcement on Wednesday, the West Virginia Democrat said he believes his proposal not only fight rising prices, but “addresses our nation’s energy and climate crisis by adopting commonsense solutions through strategic and historic investments that allow us to decarbonize while ensuring American energy is affordable, reliable, clean and secure”.

The president noted that experts who’ve criticised his domestic agenda for fueling inflation in the past have said Mr Manchin’s proposal will “reduce inflationary pressures”.

“It's a bill that will cut your cost of living and reduce inflation, lowers the deficit, [and] strengthens our economy for the long run as well,” he said.

Mr Biden also touted the health care and tax provisions of the Senate legislation, which will repeal a 2004 law prohibiting Medicare from negotiating prices with prescription drug manufacturers and extend subsidies that help Americans purchase health insurance from exchanges created under the Affordable Care Act, the landmark 2010 heath care law Mr Biden famously called a “big f***ing deal”.

The president hailed the climate programs laid out in Mr Manchin’s bill, which will allocate $369bn to “secure energy our future and to address the climate crisis”.

“Let me be clear, this bill would be the most significant legislation in history to tackle the climate crisis and improve our energy security right away,” he said. He added that it would “give us the tools to meet the climate goals that ... we've agreed to by cutting emissions and accelerating clean energy a huge step forward”.

While he acknowledged that the proposed legislation is far smaller than the ambitious agenda laid out in the defunct Build Back Better Act, he called the Manchin-Schumer deal a “compromise” that represents real progress.

“My message to Congress is this: This is the strongest bill you can pass to lower inflation, cut the deficit, reduce health care costs, tackle the climate crisis and promote energy security ... while reducing the burdens facing working class and middle class families,” he said. “So pass it — pass it for the American people, pass it for America”.