Catholic agencies say cut inflation law meets long-standing goals
By Dennis Sadowski
Landmark legislation to tackle climate change, cut prescription drug costs and establish a minimum tax on big business that was thought dead but suddenly passed the Senate is being hailed by Catholic advocates.
“It’s a small miracle that it got passed,” Dan Misleh, founder of the Catholic Climate Covenant, said of the Cut Inflation Act, which was passed Aug. 51-50. Vice President Kamala Harris cast the deciding vote.
Misleh and his organization have long advocated for passage of the climate-related elements of the renamed bill, a scaled-down version of President Joe Biden’s original $2 trillion Build Back Better plan.
The bill includes $369 billion in funding for clean energy investments, domestic manufacturing of batteries and solar panels, tax breaks for electric vehicles, and greenhouse gas reduction efforts.
Environmental advocates said such provisions would bring the United States closer to its commitment to cut carbon emissions under the Paris climate accord. Taken together, the elements of the bill are expected to reduce the country’s carbon emissions by 40% from 2005 levels by 2030, the highest on record.
The bill was expected to pass the Democratic-controlled House of Representatives on August 12 when it reconvenes for a one-day session in the middle of its summer recess.
Catholic Climate Pact staff and volunteers have been calling for the environment-related elements of the legislation to be passed in one form or another for months. An alliance-sponsored signature letter to members of Congress calling for action on climate brought together more than 300 institutional partners, including parishes, religious congregations, dioceses, nonprofits and schools.
“We’re just thrilled that the United States is back in the game (to fight climate change) internationally and domestically,” Misleh told the Catholic News Service Aug. 10.
Archbishop Paul S. Coakley of Oklahoma City, chairman of the United States Conference of Catholic Bishops‘ Committee on Homeland Justice and Human Development, also expressed support for the Senate vote.
In particular, he cited the bill’s provisions addressing environmental concerns and lowering drug prices in an Aug. 9 statement. He also said it was “cautious” that the measure “contain income provisions to offset investments when concerns about inflation and the economy are high”.
“Climate change is a global challenge that requires courageous, long-term action by Congress, and I am grateful for the many substantive climate provisions that bring the United States closer to meeting its emissions reduction goals in the framework of the Paris Agreement, which Pope Francis strongly encouraged us to meet,” the Archbishop said.
“I am also grateful for the provisions of the bill that will reduce prescription drug costs for those who rely on Medicare and continue to call on lawmakers to ensure that all health care policies respect the inherent dignity and right to life of every human being,” he added. .
Misleh, a longtime environmental advocate, said the legislation’s support for renewable energy projects is designed to help Catholic facility managers choose to add solar panels and energy-efficient equipment to their buildings.
“It’s going to make a lot of economic sense to do that,” Misleh said.
He also welcomed $60 billion for environmental justice priorities, including $15 billion for reducing carbon emissions and delivering clean energy to low-income and disadvantaged communities.
The Inflation Reduction Act underwent a makeover in order to draw votes from Democratic senses Joe Manchin of West Virginia and Kyrsten Sinema of Arizona. Republicans unanimously opposed the measure from the start.
Although it was renamed in an effort to address the high inflation facing American families, economic analysts said the bill is unlikely to do much to fuel or slow rising prices. .
An analysis by the University of Pennsylvania’s Penn Wharton Budget Model estimates that this act would cause inflation to rise “very slightly” through 2024 and then fall in subsequent years.
It would also reduce accumulated federal deficits by $248 billion over the next decade, according to the analysis.
A summary from Senate Democrats predicts the bill would reduce the federal deficit by about $300 billion.
Although the bill is still largely focused on addressing environmental issues, there is a wide range of provisions that would affect the entire economy, including the health care sector.
Lisa Smith, vice president of advocacy and public policy for the Catholic Health Association of the United States, said the bill would extend expanded subsidies to uninsured people to pay for health insurance under the Affordable Care Act through 2025. Households with incomes up to 400% of the federal poverty level, or about $106,000 for a family of four, would be able to receive assistance to pay health care premiums. insurance.
The expanded grants were due to end in December as part of the US bailout enacted in response to the pandemic.
“When it went into effect (as part of the US bailout), we saw a 20% increase in people eligible for grants,” Smith said.
Another provision caps premium payments at 8.5% of income.
For those eligible for Medicaid, the bill will cover the cost of vaccines. Smith said about 4.1 million people will be eligible for free vaccines.
She also welcomed a provision that will allow the Medicare program to negotiate the cost of a limited number of prescription drugs. The change is expected to result in significant cost savings from 2026. Currently, drug manufacturers set drug prices.
In a related step, the bill caps drug costs for seniors at $2,000. Smith said the law would allow those costs to be spread over 12 months rather than being paid all at once before the limit takes effect.
Smith added that the health care provisions will help hospitals and long-term care facilities as they continue to battle the effects of the pandemic which have cost supplies and staff and led to shortages. of staff.
“It will reduce the cost of uncompensated care,” she said, especially as people remain eligible for subsidies to pay health insurance premiums.
Meanwhile, major revenue-generating measures under the Inflation Reduction Act would offset the costs of its spending and tax incentives. They understand:
— The establishment of an alternative minimum tax of 15% on corporations with at least $1 billion in revenue. The Congressional Budget Office estimates the tax would generate $313 billion in fiscal years 2023 through 2030.
— Providing $80 billion to the IRS, more than half of which boosted the agency’s tax collection efforts. The Congressional Budget Office projects the proposal would result in $204 billion in additional revenue through 2030, a net gain of $124 billion.
Catholic Charities USA also welcomed the Senate vote and counted on the House of Representatives to do the same.
“It is a positive bill. There are many positives,” Anthony Granado, vice president of government relations, told CNS.
Still, the agency is disappointed that provisions for housing assistance and child nutrition were left out.
Granado said Catholic Charities will pursue broader funding for vital social services during upcoming negotiations on appropriation bills for fiscal year 2023 at a time when rents continue to rise rapidly and more people visit. food banks as they grapple with high food costs.
One of the main concerns is the re-enforcement of the enhanced child tax credit, Granado said, pointing to the success it had had before it expired in December.
A priority of social service agencies and advocates for low- and middle-income families, the enhanced child tax credit was in place for most of 2021 as part of the US bailout.
Across the country, parents said they are better able to provide for their families’ food and other needs thanks to the additional payments received under the expanded credit.
The credit covered 61 million children in more than 36 million households, according to Columbia University’s Center on Poverty and Social Policy. The monthly payment in November kept 3.7 million children out of poverty, the center found.