Progressives pass climate and tax deal, despite disappointments

WASHINGTON — With the enactment of a major piece of the Democratic national agenda looming in days, progressives in Congress are reluctantly but decisively rallying around a climate, health and fiscal package that is a shadow of the ambitious cradle-to-grave social policy review they once demanded.

Bowing to the realities of their party’s slim majorities in the House and Senate, the Liberals seem poised to pass a package that was written, cut back and rewritten again to suit the centrists in their ranks – then presented to them as the only option to achieve even a fraction of their aspirations while the Democrats still control the government.

“It’s a gun to the head,” Senator Bernie Sanders, an independent from Vermont and chairman of the Budget Committee, said Friday. He lamented that two Democratic hardliners — Senators Joe Manchin III of West Virginia and Kyrsten Sinema of Arizona — insisted on drastic spending cuts and tax increases before agreeing to the package.

“Am I disappointed with this? Surely I am,” he said, declining to commit to voting for the final product. “On the other hand, what needs to be weighed is that the future of the Earth is at stake.”

The measure, which faces a crucial test vote on Saturday and is poised to clear Congress by the end of next week of unanimous Republican opposition, will address some long-sought Democratic priorities, offering the party and President Biden a midterm victory. congressional elections. With nearly $400 billion in climate and energy proposals, it’s the biggest federal investment in the effort to slow global warming – ‘nothing to complain about,’ Sanders conceded .

It would also extend the Affordable Care Act’s expanded grants and make changes to the tax code aimed at making it fairer. And the legislation would inflict a notable defeat on the pharmaceutical industry by allowing Medicare, for the first time in its history, to negotiate prescription drug prices directly with drugmakers, which could allow some older Americans to save thousands of dollars every year.

“The American people are on our side,” Senator Chuck Schumer, Democrat of New York and Majority Leader, proclaimed at a press conference on Friday. “The American people know we pushed those priorities, and they overwhelmingly support what the Democrats are doing.”

But the measure contains none of the proposals to invest in public education and expand the national safety net for parents by offering childcare, paid leave or a monthly payment to most families. with children.

Sitting in a conference room on Friday, Mr. Sanders – who had pushed to spend up to $6 trillion – corrected some of those omissions, calling most parts of the legislation modest advances. He has taken to the Senate in recent days to describe his dismay at what he sees as the bill’s shortcomings and pledged to force votes in the coming days in an attempt to inflate it.

There were also additions that angered progressives. Mr. Manchin secured several concessions for his coal-producing state and fossil fuel industry, including tax credits for carbon capture technology and a requirement that the federal government auction more water and of public land for drilling. He also won a separate engagement to complete a disputed pipeline in West Virginia.

Ms Sinema has dropped a proposal to cut the tax break enjoyed by wealthy business people, including private equity executives and hedge fund managers, which allows them to pay a much lower rate of tax on certain income than other taxpayers.

Schumer noted Friday that while some lawmakers were disappointed to see the proposal dropped, several Liberal senators were pleased that it was replaced in the bill with a new tax on corporate stock buybacks.

Yet the progressives’ acceptance of the plan reflects a substantial change in their posture. With Democrats newly in charge of Washington last year, the party’s liberals had envisioned a transformative domestic policy plan that would spend up to $3.5 trillion, funded by tax hikes on businesses and Americans the wealthiest, to provide childcare and parental leave, onshore care for the elderly and disabled, and to expand public education.

They flexed their muscles at crucial times, at one point refusing to back a $1 trillion bipartisan infrastructure package that was a major part of Mr Biden’s agenda until they could be assured of the success of the social policy and the climate plan. But with Republicans firmly opposed, Democratic leaders had no leeway in the 50-50 Senate, giving Mr. Manchin and Ms. Sinema effective veto power over the package.

Mr Manchin, a coal and oil advocate, said he feared worsening inflation through overspending. Ms Sinema embraced climate change investments, but balked at plans to overhaul the tax code and raise tax rates on corporations and the wealthy. Negotiations dragged on for months, and only a few weeks ago appeared to have collapsed, leaving climate and fiscal measures at a standstill. But within a week, Mr Manchin and Ms Sinema both returned after substantial changes to win them over.

The Liberals said the resulting package was less than they wanted, but a clear indication of their influence on Capitol Hill and in the White House, where, they argued, their strong advocacy for a more ambitious bill helped keep the plan from shrinking even further.

“You have to recognize this is a huge step forward and this is a huge progressive win,” Rep. Pramila Jayapal of Washington, chair of the Congressional Progressive Caucus, said in an interview. “And that doesn’t mean it’s all a gradual win.”

The measure could still change. On Friday, senators announced plans to include $4 billion to tackle drought in parched Western states, as Senate rules officials considered whether the bill met murky requirements of the budget reconciliation process. Those rules, which shield the measure from a Republican filibuster, could force revisions in the coming days.

While the Liberals have set their ambitions high, especially after successfully passing the $1.9 trillion pandemic relief bill in March 2021 without a Republican vote, some Democrats have said the rise in inflation in recent months had dampened enthusiasm for significantly higher federal spending.

“In hindsight, the $3.5 trillion package was too aggressive — I know others would disagree,” Sen. Mark Warner, Democrat of Virginia, said in an interview. “But when you have a 50-50 Senate, the idea that we could fix it all in one bill was, again, probably too aggressive.”

Mr. Warner, who helped negotiate the $3.5 trillion budget proposal that allowed Democrats to begin work on the package and worked closely with Mr. Manchin and Ms. Sinema to ease their concerns, admitted that the legislation had its disappointments. “It’s been, you know, obviously a long and winding road, but I think there’s a really good product out there,” he added.

The Liberals have focused in particular on investing in climate change, ostensibly giving young activists and voters credit for pushing their party to action.

“This is a unique opportunity – the Finance Committee has never done anything like it,” said Senator Ron Wyden of Oregon, chairman of the committee.

Democratic leaders said they believe they have enough support from Democrats in both chambers to push the measure through Congress within the next week. As a sign of that confidence, House Democratic leaders told lawmakers to prepare to return to Washington on Aug. 12 for the measure’s final passage.


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