None other than President Biden’s agenda hangs in the balance, just three months before voters go to the polls to decide whether Democrats should maintain their majority in the House and Senate. But party lawmakers have still expressed some confidence in recent days, hoping to avoid the same shock defeat that wrecked their economic ambitions last year.
For starters, Senate Majority Leader Charles E. Schumer (DN.Y.) has yet to secure the support of one of his caucus members: Sen. Kyrsten Sinema (D-Ariz.), a A fiscal hawk and political moderate, he has said he is still reviewing the proposal, a position his aides echoed Monday.
The party’s lawmakers, meanwhile, have faced a growing barrage of criticism from Republicans, who have long opposed their plans to combat climate change, cut health care costs and overhaul the US tax code. USA On Monday, many top Republican lawmakers described the Democratic package as a tax increase for Americans. Republicans cited a analysis that only looked at some of the elements in the broader spending bill, leaving out key sections aimed at lowering Americans’ health care costs, in an approach Democrats described as misleading.
Even amid the uncertainty, Democrats have remained jubilant, sensing they may be on the verge of delivering on a long-stalled package of economic overhauls after Schumer and Sen. Joe Manchin III (DW.Va.) managed to a deal last week. The resolution marked a startling change from the party’s collapse seven months ago, when Manchin scuttled the broader roughly $2 trillion bill known as the Build Back Better Act.
“Our timeline has not changed, and I look forward to bringing this legislation to the full Senate to begin voting this week,” Schumer said Monday.
The newest and smallest measure includes $433 billion in new spending to combat climate change and reduce health insurance and drug costs for millions of Americans. Investments directed at global warming constitute the largest single explosion in federal spending on clean energy and emissions control programs in US history.
To pay for the package, Democrats have introduced a wide range of revisions to the federal tax law, including a new minimum tax on billion-dollar companies that currently pay nothing to the US government. Along with their revisions of prescription drug prices, which save Medicare money, the provisions together are expected to raise about $739 billion over the next decade. That’s enough to offset the Democrats’ recently proposed spending while cutting the deficit by $300 billion.
Democrats and Republicans have already clashed fiercely over the bill and its tax implications. On the Senate floor, Minority Leader Mitch McConnell (R-Ky.) said Monday that the costs of the spending bill could fall more heavily on individual manufacturers. Alluding to recent data from the non-partisan Joint Committee on Taxation (JCT), he described the fallout as a “body shot on a party line vote.”
But Democrats pointed to a JCT tracking analysis, released Tuesday morning, that found the manufacturing category includes tech, pharmaceutical and apparel companies. Lawmakers noted that some of the companies in those industries have previously been subject to congressional investigations for evading US taxes, although no specific company is mentioned in the new report.
Sen. Ron Wyden (D-Ore.), chairman of the tax-focused Senate Finance Committee, said in a statement reflecting that companies “played most of the games and evaded taxes by making their drugs, phones and shoes in abroad. ”
Republican lawmakers have also argued that the tax proposals violate Biden’s promise not to raise rates on Americans making less than $400,000 a year, pointing to another set of JCT data that suggests businesses could pass a new minimum tax to the Americans.
Democrats, however, have flatly rejected that reasoning, saying their tax is not targeting families and instead is aimed at making businesses pay taxes they should have been paying in the first place. And Democrats add that JCT did not factor into its calculations other benefits its bill offers, including provisions that help Americans pay for prescription drugs and health insurance.
“The more unbiased experts look at this bill, the more we can see that the Democrats are trying to sell the American people a list of goods,” said Sen. Mike Crapo (R-Idaho), the top Republican on the House Finance Committee. Senate. in a statement Monday.
In response, Manchin emphasized Monday that “there’s not a dime of change in taxes,” telling reporters that a floor rate for businesses is “fair.” Schumer separately said it would “close loopholes that have been exploited for a long time by the largest corporations.”
For now, Senate Democrats have focused much of their efforts on preparing the bill for the floor. The task has encompassed countless meetings with the House MP, as party lawmakers seek to ensure their spending proposal adheres to strict reconciliation rules. The tactic allows Democrats to adopt their bill using their 51-vote runoff majority, instead of the usual 60 votes required in the House.
A final vote could still be days away, as the reconciliation opens the door for lawmakers to offer an unlimited number of amendments. Republican advisers have signaled that they plan to put forward as many politically challenging proposals as they can, making it difficult for Democrats to stick together, keep their bill intact and get it to a vote quickly.
More unpredictably, however, the coronavirus could further affect Democrats’ plans, as the party cannot afford absences that deny them vital votes. Manchin has recovered from his coronavirus diagnosis, but another Democrat, Sen. Richard J. Durbin of Illinois, tested positive late last week. Meanwhile, Sen. Patrick J. Leahy (D-Vt.), has been out for weeks recovering from hip surgery, though he is expected to return for consideration of a reconciliation bill.
And Republicans lost Sen. John Cornyn (R-Tex.) to a Covid-19 infection on Monday, tipping the scales at least for now in favor of Democrats. However, Cornyn has vowed to return as soon as federal health guidelines allow, “if it happens,” he tweeted, referring to the possibility of a final vote.
However, the Democrats could face additional hurdles as a result of their own members, particularly Sinema, who has yet to offer her final opinion on the bill. His earlier objections to the Build Back Better Act forced party leaders to scale back their plans considerably. Last year, the Arizona moderate failed to support Democrats’ initial efforts to raise tax rates on corporations and wealthy Americans, leaving them with no choice but to abandon a core item on Biden’s agenda.
Instead, Democrats opted for the corporate minimum tax, which at the time seemed to have Sinema’s blessing. But it’s unclear whether he still supports that policy, given the broader changes in the economy since his party last tried to move a spending package. Sinema previously raised concerns about other elements of the plan, including Democrats’ renewed effort to close what’s known as the accrued interest loophole. The policy allows managers of private equity, real estate and hedge funds, among others, to pay less in taxes.