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Democrats trim Biden’s Build Back Better bill in a race to make deal


U.S. president Joe Biden gives remarks at NJ TRANSIT Meadowlands Maintenance Complex (Kearny), New Jersey, U.S.A. on October 25, 2021.

Jonathan Ernst | Reuters

WASHINGTON – As President Joe Biden prepares to depart on Thursday for a week of summits in Europe, the White House and congressional Democrats are scrambling to finalize a deal on their signature domestic spending package.

Nancy Pelosi is planning to bring the companion bipartisan bill for infrastructure to the House for a vote, if they are able to do so. It has been approved by the Senate, and Biden may sign it into law if the House approves it.

Biden was in New Jersey Monday to support the infrastructure component of his two-part Plan.

He said that the bill would provide funding for transportation and rail. “These are going to be union jobs at a prevailing wages that you can support your family, jobs that cannot be outsourced.” We will make the biggest investment in public transport in America’s history.

The House progressives will not pass the infrastructure bill unless Democrats agree to the terms.

The Senate is dominated by two Democrats from the center, Joe Manchin (West Virginia) and Kyrsten Senema (Arizona). They refuse to support the spending plan until the specific demands of their constituents are met.

Manchin has requested that the total cost of the bill’s top line be reduced from $3.5 billion to somewhere between $1.5 trillion and $2 trillion. Democrats need to rework the original plan of taxing the top earners and corporate profits to fund the safety net expansion to win Sinema over.

The toughest choices

Democrats face some tough decisions to reduce the overall cost of living. Many of Biden’s promises during his campaign have been abandoned, including the promise to provide free community college and establish a clean electricity standard that will penalize utilities who don’t conform.

Some programs, which were originally intended to last forever will be replaced by temporary ones in the next year.

There were still other plans on Monday. One plan was to increase Medicare coverage to include vision, hearing and dental care. The plan is popular among voters as well as members of Congress. However, it will be costly, with a projected cost of $350 billion per decade.

Pelosi revealed that Democrats were considering whether to eliminate the most costly of Medicare’s three services, dental care. CNN’s Pelosi stated that “dental is very costly.”

Manchin’s reports that he does not want any extension of Medicare made the Medicare issue even more complicated.

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A Monday update also included paid family leave. This is a key component of Biden’s promise that his bill will ease the financial burden for working families.

Democrats originally wanted 12 weeks guaranteed family and medical leaves for each U.S. worker. It was a benefit estimated to cost close to $500 billion per decade.

As negotiations continue, the plan is being scaled down. Late last week, the White House began work on a plan that would provide four weeks of paid vacation to low-income workers who tend to take less time than those with higher incomes.

However, Manchin has been opposed to the plan, NBC News reports Monday, citing numerous sources.

The negotiations have become more difficult and the tension has grown. The White House and Democratic leaders have done everything possible to maintain a focus on their common goal. They also worked to stop inter-party differences from turning public to fights.

Biden invited Manchin, Senate Majority Leader Chuck Schumer and his family to breakfast in Delaware on Sunday. Presidents rarely host Congressmembers for dinner, especially on Sundays at his private home. Manchin played a pivotal role during the week-end’s discussions. This was evident in their meeting.

Manchin expressed concern about what negotiators could achieve in this week’s negotiations, saying that there would be “conceptual frameworks” at the end.

Unanswered is the big question of whether or not a conceptual framework for social spending can satisfy House progressives.

Two scheduled votes for the bipartisan infrastructure bill have been blocked by House progressives.

The tax scramble

The bill’s costs are not the only thing that was still in question Monday. It was also up in the air how it would be paid for, particularly after Arizona Senator Kyrsten Sinema stated last week she had opposed two of the Democrats’ plans until now: an increase in corporate taxes to 25 or 26 percent and a return back to the top individual tax rate from pre-Trump of 35%.

Democrats will have to look further to find the money they need to finance their plans without these revenue-raisers.

A rising number of people are openly supporting the concept for a “billionaire’s tax,” which would be a special tax on 800 Americans who have the most wealth.

This laser-focused focus on taxing billionaires is something that was only embraced by the far right flank of the party a few years ago.

Pelosi stated on CNN that a wealth tax is likely to be implemented. It’s 10% less than what we really need,” Pelosi said on CNN.

Others proposals include increased IRS enforcement. This would enable the IRS to access bank records of accounts that have received $10,000 or more in non wage deposits.

The global minimum corporate tax rate (also on the table) is another option. Although it has been supported by developed nations this year, it remains in its very early stages.

CNBC’s Kevin Breuninger reported from Keany (N.J.).