” This bill will be a game-changer for American households and our economy. ». At least that’s what Joe Biden promised as the US Congress will start examining a new version of his major social and climate reform this Saturday. After being submitted to the vote of the Senators, probably at the start of the week, the text will take the road to the House of Representatives, where Joe Biden’s camp has a narrow majority. The latter desperately needs political success less than 100 days before the perilous midterm legislative elections. After 18 months of negotiations, marked by numerous compromises with the right wing of the Democratic Party, the head of state urged Congress to adopt this vast plan without delay.
Promote renewable energies rather than punish
It includes various components including one on renewables with an investment in this area deemed « historical » by the president. No less than 370 billion dollars will, in fact, be allocated to honor Joe Biden’s very ambitious objectives on greenhouse gas emissions.
To ensure the support of American households, little affected by the climate crisis when inflation reaches record highs, the Democrats have decided to touch them directly in the wallet: part of these funds will thus be used to finance credits for taxes for producers and consumers of wind, solar and nuclear energy. It is therefore more a question of putting in place financial incentives intended to make the American economy evolve towards non-fossil energy sources than sanctions against polluters in order to allow the United States to reduce their CO2 emissions by 40% by 2030 compared to 2005.
Under this reform, an American would receive up to 7,500 dollars in tax credits for the purchase of an electric car. The installation of solar panels on its roof would be covered at 30%. Some 60 billion dollars are also planned for the construction of wind turbines, solar panels and electric vehicles in the United States. The same sum is allocated to a series of programs to assist the most modest households in their energy transition, in particular by renovating their homes. Massive investments to strengthen the resilience of forests to the fires that ravage the country and to protect coastal areas from hurricanes are also included.
Reduce drug prices
Another important part of this climate and social plan: health. The second part, amounting to 64 billion dollars, intends, in fact, to partially correct the immense inequalities in access to care in the United States, in particular by lowering the price of drugs. ” The anguish of people who are unable to pay for life-saving drugs will be significantly alleviated », assured the leader of the Democrats in the Senate, Chuck Schumer. And for good reason, if this text were to be adopted, Medicare, a public health insurance system intended for people over 65 and those on the lowest incomes, could for the first time directly negotiate the prices of certain drugs with pharmaceutical laboratories, and thus obtain more competitive prices. The plan would also force pharmaceutical companies to offer consumer discounts for certain drugs whose prices are rising faster than inflation. The bill also plans to extend until 2025 the protections of the” Affordable Care Act »the iconic health insurance better known as” Obamacare »Barack Obama’s flagship law.
Finally, the last part tackles the public deficit. Because if the reform requires many investments, the” Inflation Reduction Act », as it is called, provides for the adoption of a minimum tax rate of 15% for all companies whose profits exceed one billion dollars. This new tax aims to prevent certain large companies from using the tax loopholes which have allowed them to pay far less than the theoretical rate. It is estimated that this measure could generate more than $258 billion in US federal revenue over the next 10 years.
While certain groups, such as TotalEnergies, have reaped enormous profits despite the difficult economic context in France, the idea of a tax on superprofits was also debated there, as part of the vote on measures to support the purchasing power. Qualified by the Minister of the Economy, “Pavlovian reflex of the tax”, it was narrowly rejected by the deputies. This supertax is already applied in Great Britain or Italy.