10/07/2021

White House Pushes Scaled-back Reconciliation Package

The low-cost plan is to appease Senators Sinema and Manchin

The White House is reportedly urging congressional Democrats to scale back most of the items in the $3.5 trillion budget reconciliation package to arrive at a plan in the $1.9 to $2.3 trillion range that can win unanimous Democratic support.

President Joe Biden has spent weeks attempting to mediate substantial differences between moderate and progressive Democrats on the size and scope of the proposed spending in the package. With conservative Democrats like Sen. Kyrsten Sinema (D-AZ) and Sen. Joe Manchin (D-WV) urging a lower price tag, Democratic leaders are weighing whether to fund fewer programs for a longer period of time or keep as many items as they can save for a shorter length of time.

Pelosi has told her caucus to prepare for “adjustments” to the package to fit the Senate’s constraints for the budget reconciliation process.

Democratic leaders have sought to frame the legislation alongside the New Deal and Great Society in terms of its transformative power. As originally conceived, the bill would mandate universal paid family leave and expand Medicare to include dental, hearing and vision benefits. It would also guarantee pre-kindergarten for all children ages 3 and 4, fund better protections for the nation’s elderly, increase pay for child care workers and require employers without employer-sponsored retirement plans to automatically enroll their employees in IRAs or 401(k)-type plans.

Democratic leaders want much of the cost of these new investments to be financed by new taxes on corporations and the wealthy, while sticking to Biden’s pledge not to raise taxes on anyone making less than $400,000 per year. Many conservatives are opposed, particularly those trying to protect big business.

This article was provided to OSAP by ASAE's Power of A and Inroads.