GOP Hopes To Use “Byrd Rule” To Chop Pieces Off Climate And Tax Bill

GOP Hopes To Use “Byrd Rule” To Chop Pieces Off Climate And Tax Bill

Winning over current West Virginia Senator Joe Manchin has helped Democrats move toward passage of a $433 billion tax-and-spend bill, but a rule created by former West Virginia Senator Robert Byrd may help Republicans hack some pieces off of it.  

“We’ll try and challenge everything we possibly can,” Wisconsin Senator Ron Johnson told Bloomberg. “If we can knock it all out that would be a good thing.”

Among other things, the disingenuously-named “Inflation Reduction Act of 2022” would spend $369 billion on climate provisions, increase the IRS’s enforcement firepower, impose a minimum 15% corporate tax rate and reduce the prices the federal government pays for prescription drugs. 

The “Byrd Rule” limits what can be included in a budget reconciliation bill — which is how the bill is being positioned. Reconciliation is a budget-centric legislative path that only requires a simple majority for passage, rather than 60 votes.

However, to protect the minority party against abuse of the reconciliation process, the Byrd Rule allows senators to challenge any element of the bill that’s “extraneous.” Broadly speaking, the rule bars provisions that don’t directly alter revenue or spending, but rather do those things in a way that’s merely incidental to the provision’s non-budgetary effects. 

“There is a lot in [the climate, health and tax bill] that is not pertaining to increasing or decreasing the revenue of the federal government,” Louisiana Senator Bill Cassidy told Bloomberg. “A lot of this is totally, totally unrelated to reconciliation.”

That’s not to say the bill will be obliterated. Major components representing hundreds of billions in spending and tax credits supporting the climate agenda have reportedly already passed muster with the Senate parliamentarian. 

So what is vulnerable? Cassidy singled out provisions targeting prescription drug prices, while the Bipartisan Policy Center’s Bill Hoagland pointed to a requirement requiring that automotive batteries include increasing amounts of U.S.-made components in order for qualify for a full $7,500 consumer tax credit. He also said energy tax credits tied to a host of wage, apprenticeship-program and materials-sourcing qualifications could also run afoul of the Byrd Rule. 

Of course, aside from overcoming the Byrd Rule, the bill must still attract the support of all 50 Democratic senators. With Manchin on board, all eyes have now turned to Arizona’s Krysten Sinema, who, along with Manchin, has acted as a check on Democrats’ big-spending ambitions .   

Evaluating the merits of the various Byrd Rule challenges will fall to an unelected official: Senate parliamentarian Elizabeth MacDonough. 

Senate parliamentarian Elizabeth MacDonough

In 2021, her proper application of the Byrd Rule caused a $15 minimum-wage provision to be ejected from a Senate reconciliation bill — and caused “The Squad” to flip out. Rep. Ilhan Omar even called for MacDonough to be fired.


Tyler Durden
Tue, 08/02/2022 – 08:40

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