Democrats near deal on social spending bill
What happened
Congressional Democrats and the White House appeared close to finalizing a deal on President Biden’s social spending and climate change bill this week, potentially bringing an end to five months of often bitter intraparty haggling. To satisfy centrists such as Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (DAriz.), the price tag of the Build Back Better bill has been trimmed from $3.5 trillion to below $2 trillion. Some of Biden’s campaign promises have been abandoned entirely, including free community college and paid family and medical leave. Other programs are curtailed, including the expanded child tax credit and extended Medicaid coverage. Those cutbacks have angered progressives. Sen. Bernie Sanders (I-Vt.), a crucial vote in the 50-50 Senate, has insisted that Medicare be expanded to include dental, vision, and hearing coverage. House Speaker Nancy Pelosi insisted that sacrifices had to be made. “It’s lamb eat lamb,” she said. “There is no bad decision.”
How the new spending will be funded is not yet clear. After Sinema nixed higher taxes for top earners and corporations, Democrats had to race to find new revenue streams. Sinema and Manchin have agreed to at least one proposal: a 15 percent minimum tax on corporate income, levied on firms that earn more than $1 billion for three straight years. Other revenue provisions were in flux. A plan by Sen. Ron Wyden (D-Ore.) to tax the unrealized gains of stocks and other assets held by the very richest Americans—which would raise more than half of its $500 billion in revenue from 10 billionaires, including Amazon founder Jeff Bezos and Tesla CEO Elon Musk—was quickly dismissed by Manchin as “convoluted” and needlessly divisive.
What the editorials said
What a mess, said The Washington Post. In their attempt to placate both centrists and liberals, Democrats are “at risk of producing legislation that is so compromised and slapdash that it would amount to a tragic missed opportunity.” Lasting structural reforms to the safety net have been demoted to temporary vouchers—the child tax credit, which could halve child poverty, might be expanded for only a year. And the “squishy pay-fors” now proposed in lieu of outright tax hikes might not work as advertised, adding to the deficit.
Don’t believe Democrats when they insist only the super-rich will foot the bill for this bloated legislation, said The Wall Street Journal. Wyden claims his proposal—which is likely illegal, because the Constitution says Congress can only impose “direct taxes”— would affect only 700 Americans. “That’s what they always say.” The first income tax enacted after the ratification of the Sixteenth Amendment in 1913 had seven tax brackets with rates from 1 percent to 7 percent. “You know what rates are now.” And the alternative minimum tax was initially applied only to the wealthiest Americans, but now hits millions in the middle class.
What the columnists said
We are now in “the grind-it-out stage of the process,” said Lauren Fox and Phil Mattingly in CNN.com, and it’s possible that everything could still fall apart if progressives balk at the slimmed-down deal. But centrists’ insisted-upon cuts could give negotiators “a bit more wiggle room” to win the votes of skeptical Democrats. The $150 billion once slated to get energy companies to switch to renewables—a proposal Manchin killed—could, for example, now be allocated to tax incentives for businesses that cut their emissions.
Democrats “can see the doom-laden writing on the wall,” said Hugo Gurdon in the Washington Examiner. The party is likely to lose one or both chambers of Congress in next year’s midterms, which is why Democrats are scrambling to pass “a kitchen-sink bill” stuffed with everything from universal pre-K to a string of “faddish climate measures.” This is Biden and Pelosi’s last meaningful chance to foist their “gruesome vision for the future on our suffering country.”
Passing a Build Back Better package might not save Democrats in the midterms, said David Leonhardt in The New York Times, but it could still work to their long-term advantage. Even if the law is filled with temporary programs, that means “the next few years would be filled with debates” about expiring child-care and health provisions. In a repeat of the fight over Obamacare, Democrats would again be defending programs that provide “tangible benefits to millions of Americans,” while Republicans “would be left to explain why they oppose those popular benefits.”