Pelosi Tries to Muscle Through a Vote

U.S. House Speaker Pelosi holds her weekly news conference at the U.S. Capitol in Washington
JONATHAN ERNST
By Yuval Rosenberg

Pelosi Tries to Muscle Through a Vote on Biden’s Agenda

As Democrats look to advance President Joe Biden’s stalled
economic agenda in the wake of electoral embarrassments this week,
House Speaker Nancy Pelosi (D-CA) is pressing for a vote on the
party’s reconciliation package of social spending and climate
measures as soon as Thursday evening, with another vote on the
Senate-passed bipartisan infrastructure potentially to follow
Friday morning.

“I was really very unhappy about not passing the [bipartisan
infrastructure framework] last week. I really was very unhappy,”
Pelosi told reporters Thursday. “So now we’re going to pass both
bills but in order to do so we have to have votes for both bills,
and that’s where we are.”

That means Democrats aren’t yet where they need to be. As of
Thursday evening, Pelosi reportedly doesn’t yet have the votes
needed to pass the $1.75 trillion budget plan as lawmakers continue
to haggle over various details of the social spending legislation,
including its
immigration provisions, the
details of a plan to lower prescription drug
prices and proposed changes to the current $10,000 cap on the
deductibility of state and local taxes.

Split on SALT: The House bill would lift the cap to
$72,500 through 2031, but Sens. Bernie Sanders (I-VT) and Bob
Menendez (D-NJ) have proposed leaving the cap at $10,000 but having
it apply only to taxpayers making more than $400,000 a year.

“While the $10,000 cap is much too low, eliminating the cap
entirely would result in a massive tax break for the wealthiest
families in this country,” Sanders said at a press conference
Wednesday. “The multimillionaires and billionaires who own mansions
in exclusive neighborhoods, and who can afford to make extremely
expensive purchases do not need a tax break.”

A number of centrists also want more time to review the
legislative text, which runs more than 2,100 pages long, and have
said that they won’t support the bill before they see cost and
revenue estimates for it from the Congressional Budget Office (CBO)
and the congressional Joint Committee on Taxation (JCT).

The CBO score could still take days, meaning it won’t be ready
in Pelosi’s timeframe, but Pelosi on Thursday touted revenue
estimates released Thursday by the JCT, which showed that the new
spending is essentially paid for (see more on this below). The JCT
numbers may not be enough to overcome centrists’ concerns, though.
“They’re also worried about changes to prescription drug pricing
and immigration,” Punchbowl News
reported Thursday morning. “In sum, moderates
really want to just slow this whole thing down in order to extract
more changes to the legislation. That’s what the demand for CBO
score is, in part -- a stalling tactic.”

Moving ahead without Manchin: The race to vote on the two
major pieces of legislation represents another tactical turn by
Pelosi, who has been forced to change course a number of times as
she tries to herd obstreperous Democratic lawmakers toward passing
both bills.

Pelosi initially said the House would only take up the
infrastructure bill after the Senate passed the larger budget
package. She also promised her members that she would only make
them vote on a reconciliation bill that could pass the Senate — and
yet Sen. Joe Manchin (D-WV) has made clear that he still isn’t on
board with the latest version of the legislation. “I have a lot of
concerns, let’s put it that way,” Manchin told Fox News Wednesday
night. “They’re working off the House bill. That’s not going to be
the bill I work off of.”

But House Democrats have apparently tired of trying to win over
Manchin. The House bill now includes policies that Manchin has
rejected, including four weeks of paid leave and an expansion of
Medicare to cover hearing benefits. “Many House Democrats now
believe Manchin will never verbally voice support for a package and
that voting on their own House bill is the only way to put pressure
on Manchin and break the intraparty stalemate,” The Hill
reports, adding that Pelosi said of the West
Virginia senator: "We hope that he will see the light of day.”

Moving ahead without Manchin carries risks, though, since it
erodes the linkage between the two big bills, potentially allowing
the Senate to strip out elements of the House version of the budget
package and send the revised version back for another House vote —
a process that would lengthen the time it takes to pass the
plan.

“I wouldn’t be surprised at all if, between the
parliamentarian and Joe [Manchin]’s concerns ... whatever the House
sends will have to be modified at least a little,” Sen. Brian
Schatz (D-HI) told
Politico. “It will not be enacted as is. Everybody
needs to sit with that and get comfortable with it.”

Quote of the Day

“I hope my colleagues absorb this notion that when you’re the
majority, the ‘D’ in Democrat should stand for ‘doer,’ not ‘delay,’
‘dithering,’ ‘do-nothing,’ ‘division.’”

– Sen. Tim Kaine (D-VA), as quoted by
The Hill, arguing that Tuesday’s election results
point to an urgent need for Democrats to define themselves for
voters by enacting their economic agenda.

Pelosi Says Build Back Better ‘Fully Paid For and Reduces the
Deficit’ but Critics Decry Gimmicks

A congressional analysis of the Build Back Better bill finds
that the tax increases contained within it would raise about $1.5
trillion over a decade, bolstering Democrats’ claim that a major
component of President Biden’s social agenda would be paid for with
new revenues and would even help shrink the budget deficit.

The estimate from the nonpartisan Joint Committee on Taxation
examines only the proposed changes to the tax code in the
still-developing, $1.75 trillion bill, including the creation of a
new minimum tax on large corporations and a surtax on individual
incomes over $10 million. Other significant elements, such as
additional revenues generated by a beefed-up IRS and savings from
reduced drug prices, are not accounted for.

Highlighting the JCT report in a message to colleagues Thursday,
House Speaker Nancy Pelosi (D-CA) said that other revenue sources
in the Democratic bill would raise an additional $650 billion,
pushing the revenue total for the bill over $2 trillion. “It is
essential that the legislation is fully paid for and reduces the
debt,” Pelosi said.

Pelosi also cited analyses from “the nonpartisan Moody’s
Analytics and 17 Nobel Prize-winning economists” that concluded the
Democrats’ bill would “grow the economy without increasing
inflation, because it is fully paid for.”

Some budget experts, however, have questioned the projected
revenues associated with some parts of the Democratic plan.
Enhanced IRS enforcement, for example, is projected to bring in
$400 billion over 10 years, though some experts say it would likely
bring in far less.

Still, the JCT analysis shows that Democrats’ proposed tax
increases are substantial and go a long way toward offsetting the
cost of their bill.

What about the gimmicks? Some fiscally conservative
Democrats and budget watchdog groups have criticized the way the
spending plans are structured in the bill, with several key
provisions set to expire as part of an effort to keep the long-term
cost to a minimum.

At a press conference earlier this week, Sen. Joe Manchin (D-WV)
blasted the “shell games” and “budget gimmicks” that he said the
bill writers are using to artificially reduce the cost of the bill,
while speculating that the true cost was twice what Democrats are
citing.

The issue is simple: While the bill shows some new program
expiring after two or three years, supporters of those programs
expect them to continue, extended by lawmakers in a future
Congress. If and when that happens, the budget analysis goes out
the window as the cost increases each year a given program is
extended. An analysis by the Committee for a Responsible Federal
Budget found that extending the programs in the Build Back Better
bill could cost an additional $2 trillion, meaning that the
potential long-term costs of the package are far from covered.

The use of such gimmicks has a long history. As The New York
Times’ Alan Rappeport
notes, the Bush tax cuts of 2001 and 2003 were
supposed to expire in 2010, but were extended during the Obama
administration, with some becoming permanent. Similarly, the
individual tax cuts provided by Republicans in 2017 are scheduled
to expire in 2025, but could end up getting extended by Congress,
increasing the actual cost of the Trump tax bill.

Now the shoe is on the other foot, with Democrats deploying
sunsets to lower the price of their bill, and fiscal conservatives
left to complain about it. On Thursday, the ranking Republican
members of Senate committees sent a letter to Senate Majority
Leader Chuck Schumer (D-NY) demanding hearings to discuss the
spending bill, so to “properly assess what impact a bill will have
on the federal budget.”

Waiting on the CBO: While the JCT analysis may mollify
some Democratic lawmakers who have concerns about the cost of the
Build Back Better bill, others are expected to stick by their
demand to see a separate report from the Congressional Budget
Office, though it’s not clear if the lack of a CBO score will hold
up an expected vote in the House this week.

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