Senator Joe Manchin (DW.Va.) lays out his vision of what a mini-budget bill might look like as his party looks to a second round of moving a major policy bill through a reconciliation process that would undo the GOP’s deadlock.
But this time, Democrats are playing down the chances of an imminent deal.
Manchin last December canceled the House’s nearly $2 trillion Better Build package, sending the party into a legislative slump.
The party now faces significant hurdles to renewing the tax and spending plan at the center of their agenda as they feel increasing pressure to deliver achievements to their constituents.
Senator Dick Durbin (Illinois), the second Democratic senator, said there are “varying levels of optimism” within the bloc about reviving Reconciliation, the budget process that cuts off the GOP’s disruption and will allow Democrats to pass a measure with votes from its members only.
“I’m the most skeptical,” Durbin said. “I want to see the results. I want to put a couple of my roommates up with a blank sheet of paper and ask them, ‘What would you agree to?’ There seems to be some problem with that.”
Senator Ben Cardin (D-MD) noted that Democrats were largely delegating talks with Manchin about reconciliation to Senate Majority Leader Charles Schumer (DNY).
“You won’t hear much about it until the decision is made,” Cardin said. “There have been no reports to us, and we are not expecting any reports.”
The Democrats and the White House have acknowledged that there are talks underway, but they are also eager to draw hard red lines or tout their talks after they set deadlines, repeatedly missed them last year.
“We’re always optimistic. That’s all I have to say,” said Senator Sherrod Brown (D-Ohio), chair of the Senate Banking Committee.
On Tuesday, Manchin met with Schumer on how to combat inflation.
After the meeting, the West Virginia senator said he believed the focus of any reconciliation bill should be on lowering inflation and deficits.
Manchin noted that the way to do this includes making changes to the tax code.
He outlined part of what he could support on tax changes as part of the settlement bill, including increasing the corporate rate to 25 percent, putting capital gains at 28 percent, eliminating “loopholes” and “making sure everyone pays their fair share.” .”
Manchin also wants half of any income to go toward deficit reduction, saying this is “the only way to fight inflation.”
“Just a fair and competitive tax law” about what he wants to see in the settlement bill, Manchin added.
Both Manchin and Schumer toned down any expectation that they were deep in the kind of formal negotiations that could foster a swift agreement that would eventually allow the party to move what was supposed to be the center of its legislative agenda.
“Nothing is official. There are no false hopes here. There is nothing, in terms of building better, there is no talk of any of that. I’m just saying how do we deal with inflation,” Manchin said.
Schumer also stressed that talks with Manchin were “preliminary.”
Our meetings were preliminary and good, and we will continue to talk. If you want to get rid of inflation, the only way to do that is to undo a lot of Trump’s tax cuts and raise interest rates,” Schumer said.
Democrats are facing growing calls from within their party to quickly try to show voters they can file before the November midterm elections when they could face harsh political headwinds that threaten their ability to hold on to the House of Representatives.
“As Democrats, we need to achieve our goals. We need to face the costs head-on, and we have the strength to do so. We have less than 200 days left, and instead of looking back, let’s look forward,” said Senator Elizabeth Warren (Democrat of Massachusetts) during an interview with CBS News’ “Face the Nation”: Let’s do what we can do for the American people who elected us, and for the American people who depend on us.
Senator Tim Kaine (D-Va), asked by Hill about the Democrats’ ability to get a deal this year compared to 2021, pointed to pressure from their base, saying, “I think our voters want us to.” Keane is among Democrats putting forward Memorial Day as a deadline to reach agreement on a revived bill, even if they don’t have a final legislative text.
“Either we have a handshake deal or I don’t think it will work out. I like to be wrong,” he said.
But reconciliation would be an important boost for Democrats and the White House.
To pass a bill under the Reconciliation, Democrats would need a full unit of all 50 members of the Senate and nearly all of the House of Representatives.
That would be difficult. Manchin’s position on raising the corporate tax rate is at odds with Senator Kirsten Senema (D-Arizona), another moderate who has said she won’t raise taxes if it hurts the economy
And Manchin’s push to take “social” programs out of “Building Back” could also lead to a backlash from fellow Democrats, who see reconciliation as their best bet to expand Medicare, support Obamacare, or create programs like paid vacation. Pay or enhance the children’s tax credit.
“I really want the workforce and childcare to be a part of it,” Kane said, asking about a compromise bill that focused solely on inflation and deficit reduction.
Other Democrats said they would be willing to use Manchin’s skinny version as a starting point, if it meant the party could finally strike a deal.
“Hopefully we can do something,” said Senator Mazie Hirono (D-Hawaii). “We have to get things moving. And the atmosphere is open to tax reform. … I can start with that.”