Democrats Weigh How to Bridge $2 Trillion Gap in Biden’s Spending Bill
Democrats Weigh How to Bridge $2 Trillion Gap in Biden’s Spending Bill
(Bloomberg) -- Congressional Democrats are beginning to discuss how to pare down a sweeping social-spending bill that President Joe Biden had designed to transform the federal government’s support for lower-income Americans, in a wrenching effort to get it enacted.
Lawmakers have yet to coalesce around a list of priorities, or even begun negotiations with both moderates and progressives present -- a hallmark of when a deal is close to being reached. Biden and White House officials, however, have held a series of meetings in recent days with key Democrats, including groups of liberal House lawmakers and key centrist Senators Joe Manchin and Kyrsten Sinema.
Senate Majority Leader Chuck Schumer said he hopes a deal can be reached by the end of October -- an ambitious timeline with lawmakers still trillions of dollars apart on how much they want to spend. Democrats had agreed on a $3.5 trillion outline in the budget resolution passed in August, but Manchin says he can only support up to $1.5 trillion in a final bill. Biden has floated a topline figure of roughly $2 trillion.
“We won’t be able to put everything that’s on the table in the bill,” Senator Dick Durbin, the No. 2 Senate Democrat, told reporters Thursday. “It’s physically impossible, if we are limited.”
A third or more of the spending may need to be slashed from the House version of the bill. That version is estimated to cost at least $3.5 trillion, but the official scorekeeper, the Congressional Budget Office, said Thursday it didn’t know when it would have its calculation -- further complicating Democrats’ discussions.
Explaining Cuts
Progressives say it’s incumbent upon moderates seeking a lower topline figure to specify which areas of the spending on child care, community college tuition, health care and climate programs they want to eliminate.
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“Anyone who wants to make cuts needs to explain where they want to cut and why,” Senator Elizabeth Warren, a Massachusetts Democrat, told reporters.
Moderates have been largely mum about their preferences for which of Biden’s proposals to eliminate in a smaller bill. Manchin on Wednesday said he wants to prioritize spending on children and the elderly, but didn’t elaborate on which measures to exclude.
Lawmakers have several tools to cut the cost that fall short of killing an entire section of the bill: shortening the time period that programs are offered or limiting the benefits based on income or other criteria, for example. But those options would still involve complex negotiations.
Members are also cognizant that the legislation will be an important political talking point during the 2022 mid-term elections, when Democrats will be fighting to maintain their narrow majorities in both chambers. Democrats are hoping that the popularity of certain programs, including monthly payments of the child tax credit, will compel voters to vote for them.
Delayed Programs
“The beauty of the child tax credit is everyone knows they get it. Everybody has already gotten three of them -- they’re about to get the fourth,” Senator Sherrod Brown, an Ohio Democrat, said. “I want these to have an impact right away.”
Democrats are also weighing how much emphasis to put on programs that will take longer to implement, such as dental benefits for elderly Americans, which aren’t slated to go into effect until 2028 in the House legislation.
“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,” Durbin said. “Now, the other problem is, of course, if you go into a benefit such as dental care for Medicare, and you have to postpone the effectiveness of it or the reimbursement, it may not ever get it off the ground. So these are hard questions.”
Once a top-line spending number is finally agreed on, the Democrats will then have a clearer picture of what the task will be on the other side of the ledger: tax hikes. With little more than three weeks to go until Oct. 31, it all makes for a hectic month.
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