A guide to all the ways the House spending bill would affect America
WASHINGTON - House Democrats on Friday morning passed a more than $2 trillion bill to overhaul the country's health care, climate, education and tax laws, moving beyond months of disputes between liberals and moderates that have stalled President Joe Biden's economic agenda.
The legislation builds off a framework that Biden unveiled to party lawmakers and includes new spending to enhance child care, provide free prekindergarten, combat climate change and advance a slew of tax benefits that chiefly aid low-income Americans.
But the bill omits many of Democrats' top priorities, a reflection of the party's difficult work to scale back a package once valued at $3.5 trillion. It now moves to the Senate, where it may face further cuts.
What follows is a guide to the legislation, one of the most significant overhauls of domestic policy in generations.
- - -
What's in the plan for health care?
Senior Biden administration officials have characterized the plan's health-care elements as the biggest expansion of affordable care in a decade, predicting the changes would extend coverage to 7 million people. Highlights include:
An extension, until 2025, of expanded premium subsidies for most Americans who purchase health plans through Affordable Care Act marketplaces, as begun in the spring through the American Rescue Plan law.
The ability, until 2025, for low-income people in a dozen states that have not expanded Medicaid to buy ACA health plans without paying a monthly premium.
An expansion of Medicare benefits for older Americans to include hearing benefits.
A new plan to try to lower prescription drug costs for millions of seniors on Medicare.
- - -
What's in the plan for education?
Some of the most ambitious and expensive plans seek to ease the financial burdens facing millions of American families, particularly low-income parents with children.
Universal free prekindergarten for all 3-year-olds and 4-year-olds, which the White House has described as the largest expansion in such education programs since the creation of public high school roughly a century ago.
The prekindergarten effort is part of a broader $380 billion bucket of funds that also includes funding to help Americans pay for child care. The lowest-income families would get free child care, and families who earn up to $300,000 annually would see expenses capped at 7% of their income.
- - -
What's in the plan for climate?
The Biden administration aims to secure $555 billion in spending to address climate change, an amount the White House says makes the bill the biggest clean-energy investment in the nation's history.
The bulk of the clean-energy measures comes in the form of tax breaks for companies and consumers that install solar panels, improve the energy efficiency of buildings and purchase electric vehicles. The electric vehicle tax credit in particular could lower the cost of such a vehicle by $12,500 for a middle-class family, according to the administration.
There are additional financial incentives for making wind turbines and other clean-energy equipment domestically and in union-organized factories.
- - -
What's in the plan for taxes?
The Biden administration says the plan is financed in full. But the reality is more complicated. An official analysis from the Congressional Budget Office finds it could add $367 billion to the deficit over the next decade, however, Democrats note that their official estimate does not include other revenue raisers that cover the entire tranche of spending.
Among the most critical revenue raisers:
A new 15% corporate minimum tax on large corporations, part of a broader effort on the part of the White House and Democrats to address the fact that some companies reduce their tax burdens to zero.
A new tax targeting companies that perform stock buybacks.
A new tax surcharge targeting the wealthiest Americans. The proposal would impose a new 5% rate on those with incomes above $10 million and an additional 3% surtax on incomes above $25 million.
A new effort to empower the Internal Revenue Service to pursue tax cheats, with a focus on Americans at higher incomes.
The House bill also includes the temporary repeal of the $10,000 cap on what state and local taxpayers can deduct off their federal taxes, a provision enacted by Republicans in their 2017 tax law.
Initially, the White House had hoped to raise even more money by ratcheting up rates on corporations and wealthy Americans, a move that would have unwound the tax cuts imposed under President Donald Trump in 2017.
- - -
How does the plan change the child tax credit?
The bill seeks to build on a large expansion of the safety for families with children that was a landmark element of Biden's stimulus that passed in March.
$200 billion will go toward expanding the child tax credit and the earned income tax credit, two major antipoverty initiatives, extending the provisions for one more year.
Under the American Rescue Plan, the child tax credit was expanded for the 2021 tax year to a total of $3,600 for children 5 and younger, and $3,000 for those ages 6 through 17. As the payments hit bank accounts in July, the benefit reached an estimated 60 million children in 39 million households across the country.
- - -
How does the plan affect infrastructure?
The law seeks to add more money for infrastructure, even after Biden signed into law a sweeping bipartisan infrastructure bill earlier this month.
The infrastructure package launches a vast new effort to improve the nation's transportation networks, water and power systems, and Internet connections. The new social and climate bill goes beyond that with spending on high-speed rail and public transit near affordable housing.
The bipartisan $1.2 trillion law has hundreds of billions of dollars in spending for roads and other major projects, including what the White House says is the largest investment in building and fixing bridges since construction of the interstate highway system in the 1950s.
- - -
What's in the plan for elder care?
After the coronavirus pandemic emphasized the difficulties facing seniors as they age, the plan seeks to make a significant investment in helping aging Americans in the latter years of their lives, especially those who can't care for themselves.
The legislation infuses roughly $150 billion to in-home and community-based services under Medicaid, which includes services such as assistance with eating and bathing, as well as physical therapy and nursing care.
The social spending bill would permanently increase by 6% the funding the federal government gives each state for in-home and community-based services, as long as the state creates a plan for strengthening and expanding services.
- - -
What's in the plan for housing?
The legislation makes what is widely considered the largest infusion of federal funding for housing in modern history.
The legislation spends $170 billion on housing assistance for lower-income Americans.
Roughly $65 billion will go to rebuild and repair public housing. About $25 billion will go to federal housing vouchers to help low-income tenants afford rent, which could help reduce homelessness.
The housing trust fund program, aimed at expanding the stock of affordable housing for low-income families, will get an additional $15 billion.
- - -
What's in the plan for paid family leave?
House Democrats passed the first national paid family and medical leave program as part of their $2 trillion package.
The bill puts aside about $200 billion to provide four weeks of paid family and medical leave starting in 2024.
The four weeks of leave would apply to full-time and part-time workers, with money paid out either through a new federal benefit or through existing state or employer-based plans.
- - -
What's in the plan for immigration?
The reconciliation bill would create the largest mass-legalization program for undocumented immigrants in U.S. history, but it falls short of a path to U.S. citizenship.
Nearly 65% of the undocumented immigrants in the United States would be protected from deportation for up to a decade.
The largest affected groups are from Mexico, followed by Central America, but the group also includes people from Asia, Africa and all over the world.
- - -
How the plan affects the debt
An analysis by the Congressional Budget Office found that the bill would result in net increase in the deficit totaling $367 billion over the next decade.
But the estimate did not include the full savings that could be achieved from some of the Democrats' revenue-raising provisions, including a new plan to empower the Internal Revenue Service to recapture unpaid federal taxes. The White House has estimated that IRS enforcement alone could capture roughly $400 billion in additional revenue, while the CBO estimated a more modest $207 billion.
- - -
The Washington Post's Dan Diamond, Amy Goldstein, Dino Grandoni, Michael Laris, Laura Meckler, Tik Root, Rachel Roubein, Rachel Siegel, and Jeff Stein contributed to this report.
Related Content
As Haiti's crisis worsens, a rising number flee by sea
Climate change and extreme weather are crimping America's pie supply
