Biden Brings His Stimulus Pitch to Prime Time

By Yuval Rosenberg

Biden Takes His Stimulus Pitch to Prime
Time

President Biden is taking his pitch for a $1.9 trillion
coronavirus aid package on the road, traveling to Milwaukee Tuesday
for a CNN town hall at 9 p.m. ET that is expected to focus on the
pandemic, the economy and the relief bill that Democrats are
pushing to pass quickly. The event is Biden’s first official trip
out of Washington, D.C. since taking office. Biden is set to visit
Michigan, another Midwestern battleground state, on Thursday to see
a Pfizer manufacturing site and talk to workers making the Covid-19
vaccine.

Where the relief package stands: As the Senate was
dealing with the second impeachment trial of former President Trump
last week, nine House committees passed their sections of the
massive package, with Democrats voting down dozens of GOP
amendments "targeting everything from abortion to the minimum wage
to the Keystone XL pipeline," The Washington Post
reports.

Congressional Republicans largely oppose Biden’s proposal,
arguing that it costs too much and should be more targeted. They
also object to Biden’s proposed $15 minimum wage and the $350
billion in aid to state and local governments. In an interview
published Monday,

Senate Minority Leader Mitch McConnell told
The Wall Street Journal that the Biden
administration’s policies will help unify a fractured GOP. "I don’t
think many Republicans are going to be for very many of the things
that are coming out of this administration," he said.

Democrats are set to move ahead using the budget reconciliation
process that allow the package to pass the Senate with a simple
majority, meaning the GOP support won’t be necessary. But the White
House and congressional Democrats are still ramping up pressure on
Republicans, pointing to polls that show the $1.9 trillion package
is
widely popular with the public in suggesting that
the GOP’s position is politically risky. "If they make a decision,
Senator McConnell, the Republicans in Congress, to vote against the
will of their constituents, I would suggest you ask them why that’s
smart politically," White House Press Secretary Jen Psaki told
reporters Tuesday.

House Democrats are targeting a floor vote next week to send the
legislation to the Senate. Politico
reports that Democrats are holding a series of
issue-specific caucus calls Tuesday and Wednesday to get
information on the legislation out to their members.

$15 minimum wage remains in question: Biden has suggested
that increasing the minimum wage to $15 may not make it into the
final legislation. "I put it in, but I don’t think it’s going to
survive," he told CBS News this month, suggesting that standalone
legislation could follow.

The wage hike faces questions about whether it qualifies for
inclusion in the relief package under the special rules for budget
reconciliation, but political considerations also loom large.
Conservative Senate Democrats Joe Manchin of West Virginia and
Kyrsten Sinema of Arizona, whose votes are crucial for passage,
oppose the $15 wage, while House progressives are pushing strongly
for the provision to be included. "If the Senate strips out the
minimum wage increase and sends the legislation back to the House
without it, liberals in the House would face a decision about
whether to support the package anyway," the Post notes.

The Hill’s Alex Gangitano details the key players to watch
in this fight
here.

Congressional Democrats Are Bringing Back Earmarks

Democrats are planning to bring earmarks back into the budgeting
process, according to a report in Punchbowl News.

Sometimes criticized as an enabler of wasteful government
spending, earmarks allow lawmakers to designate funds for specific
projects and often grease the wheels of dealmaking in Washington,
with one lawmaker approving funding for a bridge in, say, Alaska in
exchange for a new highway interchange in Illinois. Earmarks were
banned in 2011 in an effort led by the wave of tea party supporters
who won control of the House in the 2010 midterm elections.

Rep. Rosa DeLauro (D-CT) and Sen. Patrick Leahy (D-VT), the new
leaders of the House and Senate appropriations panels, will
reportedly announce the return of earmarks in the next few weeks.
In what may be an effort to reframe the practice and distance it
from past corruptions, the earmarks will be referred to as
"member-directed spending."

There will reportedly be limits on spending amounts, with full
transparency and a restricted set of potential recipients that
includes state and local governments and non-profits and excludes
for-profits.

A good thing? Bloomberg’s Jonathan Bernstein
said Tuesday that the return of earmarks is
"marginally good news" because they probably make it easier to
reach compromises in Congress. They’re also budget neutral,
Bernstein said, since they can only direct already appropriated
funds to specific projects, not create new spending.

Still, the return of earmarks by whatever name will upset
some critics and revive a sometimes unseemly industry in
Washington. "This will rejuvenate a whole line of business for
lobbying shops," Punchbowl said. "Appropriations lobbying was once
a very lucrative corner of the influence market -- that will come
back now."

Column of the Day

Binyamin Appelbaum of
The New York Times argues that policymakers should
worry less about driving inflation higher with increased government
spending and more about providing aid to individuals and
organizations still suffering from the coronavirus pandemic. He
takes aim at official estimates of the "output gap," the difference
between what the economy actually produces and wat it could
potentially produce:

"The output gap is an elegant concept, but nobody knows
how to measure it precisely, nor is its relationship to inflation
clearly understood. Guesses by educated people are not the same
thing as educated guesses. And there are plenty of smart people who
don’t see inflation coming over the horizon. The most recent Survey
of Professional Forecasters, published Friday, anticipates an
annual average inflation rate of 2.03 percent over the next 10
years."

White House Says It Will Send 13.5 Million Vaccine Doses as
Week to States

The White House said Tuesday that it is upping the supply of
coronavirus vaccines the federal government sends to states each
week from 11 million to 13.5 million. It is also doubling the doses
sent to pharmacies to 2 million. White House Press Secretary Jen
Psaki said vaccine distribution has increased by 57% since
President Biden was inaugurated on January 20.

The announcement comes after a bipartisan group of
governors on Monday sent a
letter to the president saying that better
communication is needed in the vaccine distribution process and
that plans to use pharmacies and health centers in the vaccine
effort should be coordinated with states. CNN
reports: "A person familiar with the situation,
who asked not to be identified in order to speak candidly, said
governors wanted the administration to be more clear with the
American public that the constraints in receiving the vaccine are
due to a national shortage of doses and not due to the failures of
state and local officials, who are largely being
blamed."

A Complicated Year for Tax Filers

Tax season kicked off Friday as the IRS began accepting returns
for 2020, and there will be an extra layer of difficulties and
confusion for taxpayers this year.

Millions of people saw unexpected changes to their incomes last
year and their tax returns will have to take those sometimes
complicated variations into account. On top of that, some filers
will be using their returns to claim stimulus payments they missed
or were paid in the wrong amount.

"2020 was kind of a year for the ages and all the life
experiences it took with it," Mark Steber of the tax-preparation
firm Jackson Hewitt
told The Hill’s Naomi Jagoda. "There’s a lot for
people to watch for on their taxes, and a lot to watch out
for."

Unemployment benefits are one issue that could trip up a lot of
filers, experts say, since not everyone is aware that the payments
are taxable income, and they could leave some people with large,
unexpected tax bills. Fraud adds another wrinkle, as thieves used
stolen identities to claim benefits while leaving financial and
legal headaches in their wake.

The next coronavirus relief bill adds yet one more potential
point of confusion. Congress is expected to allow people to rely on
their 2020 tax returns in the calculation of new stimulus payments,
and those who saw their incomes drop last year may want to file
quickly. Those who saw their income rise may want to wait.

Congress could provide some amnesty for some groups of people,
with one Democratic proposal seeking to exempt the first $10,200 in
unemployment benefits from federal income tax. But it’s not clear
at this point what exemptions might pass, even as the IRS opens the
door to returns.

"The biggest thing is we don’t know what we don’t know," tax
expert Adam Markowitz told Jagoda.

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