Proposed Amendments to Senate Megabill: The Good, the Bad, and the Interesting

The Senate is deep into its “vote-a-rama” — a marathon session of successive procedural votes forced by the Democratic minority — to advance Republicans’ One Big Beautiful Bill Act to a final vote and return it to the House. During this process, senators can offer unlimited amendments that must go up for a vote. Although most of these amendments are sponsored by Democrats solely to make Republicans’ week as painful as possible, some are genuine efforts by GOP senators to mold their party’s signature legislation before it leaves the chamber. As a helpful guide, I give you the good, the bad, and the interesting of those amendments:

The Good

• Reducing federal Medicaid spending on ACA-eligible adults: A controversial amendment by Senator Rick Scott (R., Fla.) would reduce the federal government’s share of Medicaid costs for new enrollees covered under the Affordable Care Act’s expansion of the program, beginning after 2030. Those beneficiaries are adults with incomes up to 138 percent of the federal poverty level, and the 90 percent federal contribution rate for their coverage is far higher than for other Medicaid recipients, including children, the elderly, and the disabled. Senator Scott’s amendment would keep the reimbursement rate at 90 percent for those enrolled before the end of 2030, thereby “grandfathering them in,” but would have coverage for those enrolled after that year reimbursed at the regular rate. According to Politico, Senate Majority Leader John Thune agreed to support this amendment on the floor in exchange for Scott and a few other holdouts voting to begin debate on the larger bill. If adopted, it would reduce the ten-year cost of the legislation by an estimated $313 billion. That would be a very welcome development, as would the effect of requiring states to bear more responsibility for their ballooning Medicaid programs.

• Reining in farm subsidies for wealthy recipients: Senator Chuck Grassley (R., Iowa) is proposing a maximum income threshold for farms that receive federal subsidies. This amendment is part of a long-running effort by Grassley to cut farm aid payments to the highest-earning recipients, a rare yet admirable priority for a farm state senator. He is right that the wealthiest farm households benefit enormously from farm aid programs. As the Cato Institute notes, “23 percent of farms with yearly revenues of less than $100,000 receive federal subsidies, but 69 percent of farms above that income threshold do.” Moreover, between 1995 and 2010, the top 10 percent of recipients collected over 78 percent of crop subsidies. Grassley’s amendment is especially prudent given that the megabill includes a lavish $67 billion expansion in farm subsidies beyond current law. Right on cue, various other farm state Republicans are intent on blocking any sensible restriction on those funds.

The Bad

• Letting green energy subsidies stick around for longer: Senator Joni Ernst (R., Iowa) is leading an effort to delay the phaseout of renewable energy subsidies created by the 2022 Inflation Reduction Act. Instead of canceling tax credits for projects that enter service by 2027, as the bill’s current text would, Ernst’s amendment would extend those subsidies that merely begin construction by 2027. Similar amendments have been brought by Senator Lisa Murkowski (R., Alaska), which are supported by some Republican senators whose states are home to projects set to receive green energy subsidies. For conservatives without a vested interest in their continuation, it goes without saying that the Inflation Reduction Act’s attempt at industrial policy should be terminated as swiftly as possible. The silver lining in Ernst’s amendment is that it would remove a peculiar new tax on wind and solar projects that have any trace of Chinese inputs. Just as renewable energy should not be unfairly subsidized in its competition with fossil fuels, the industry should not be unfairly penalized by the federal government either.
• A tax-and-spend policy for rural hospitals: Left unsatisfied by a $25 billion “stabilization fund” for rural hospitals to counteract the effect of Republican Medicaid reform, Senator Susan Collins (R., Maine) has an amendment to double its size to $50 billion. That inordinate sum far exceeds what rural hospitals can reasonably expect to lose in Medicaid funding. To pay for it, Collins would take a page out of Democrats’ book by raising the top income tax rate to 39.6 percent for those earning more than $25 million. The GOP conference should reject this unnecessary redistribution.

The Interesting

• Limiting a moratorium on AI regulation: Senator Marsha Blackburn (R., Tenn.) and Senator Ted Cruz (R., Texas) are offering a compromise amendment to moderate a moratorium on state-level AI regulations, the inclusion of which in the bill was spearheaded by Cruz. The moratorium, as it currently stands, would condition federal aid to states on their not enacting laws that “limit, restrict or otherwise regulate AI models, AI systems and automated decision-making systems” for ten years. Following resistance from numerous Republican governors and senators, the amendment would cut the moratorium’s time frame to five years and carve out exceptions for laws aimed at children’s online safety and protecting individuals’ names, images, and likenesses, so long as they do not create an “undue or disproportionate burden” for AI systems.