Democrats Divided Over How Best to Slice Biden’s Economic Agenda
(Bloomberg) -- Democrats are coalescing around a tax and spending plan totaling about $2 trillion, but the party’s progressives and moderates remain divided over which pieces of President Joe Biden’s agenda to pay for -- and how long to pay for them.
House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer must pick and choose from a Democratic wish list that includes free community college, subsidized child care, expanded Medicare benefits and a large investment in climate programs as they attempt to draft a bill that can pass both chambers.
House Democrats last month wrote a $3.5 trillion bill funding those programs and more largely through tax increases on the wealthy and corporations, but moderates balked at the cost. Biden has suggested as a compromise a roughly $2 trillion benchmark, a number that seems to be taking root within the caucus.
“I’m very disappointed that we’re not going with the original $3.5 trillion which was very transformative,” Pelosi told reporters Tuesday. “The fact is that if there are fewer dollars to spend, there are choices to be made.”
Central to those choices in the coming weeks will be debates about whether to eliminate programs entirely or do more but for shorter periods of time. Progressives say they want to include the full menu, while moderates say that carries the risk of programs eventually being cut by Republicans.
“We should focus on doing fewer things better for longer that have a tangible, immediate impact for the American people,” said Representative Suzan DelBene, a Washington State Democrat who is chair of the moderate New Democrat Coalition. “I have little confidence that a future Republican-controlled House or Senate would extend the enhanced Child Tax Credit or other Democratic priorities without significant erosion.”
Congressional Progressive Caucus Chair Pramila Jayapal, another Washington State Democrat, says progressives are willing to discuss curbing the time certain benefits, such as free community college, are offered, but they want the full range of Biden’s proposals in the bill.
“If we have to cut the numbers slightly, then we would reduce the number of years because the universality of benefits and the immediacy of benefits is absolutely critical,” Jayapal told reporters on a call Tuesday.
Senate Budget Chairman Bernie Sanders, a Vermont independent, said he is unwilling to cut expanding Medicare benefits to include dental, vision and hearing coverage to elderly Americans.
“This to me is not negotiable,” he said. “These provisions should have been included in the original Medicare bill. They were not. The time is now -- 50 years later.”
Sanders has faced opposition from some Democrats, including House Budget Chairman John Yarmuth of Kentucky, who have said Medicare benefits should be one area to scale back because the costly programs take years to roll out and wouldn’t provide short-term relief for struggling Americans.
Senator Dick Durbin, the No. 2 Democratic leader in that chamber, said he supports keeping the bulk of Democratic goals with early expiration dates, in the hopes Congress would ultimately renew them.
“I would argue that if it’s a good program that’s popular with the American people, they’ll find a way to extend it,” the Illinois Democrat said. “And that is a possibility.”
Still, two moderates with outsized influence in the 50-50 Senate -- Joe Manchin of West Virginia and Kyrsten Sinema of Arizona -- have pushed for a smaller package and Manchin has publicly laid out some of his ideas for a more limited approach. He has said he believes Democrats should claw back some of the 2017 tax cuts on the wealthy and corporations and use the revenue to pay for target benefits for children and older people. He said another priority should be drug pricing constraints for Medicare.
“These are things we can all agree on, very easily,” Manchin said. He added that the bill should focus on “taking care of those who can’t take care of themselves.”
Complicating the Complications
These debates are likely to come to a head next week when both the House and Senate return to Washington. Pelosi and Schumer are eyeing the month’s end as an unofficial deadline for an agreement on the bill.
The next two weeks will be complicated by the Oct. 31 exhaustion of a current extension of highway funding -- and that date is set by Pelosi as a new target for passage of the Senate-passed bipartisan infrastructure bill, with its $550 billion in new spending.
Yet there remains little sign that House Democratic progressives will relent on their demand that the much broader package of social-safety net and climate programs first be finalized and acted on, before voting on that bill.
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