The Journal Gazette
 
 
Wednesday, October 27, 2021 1:00 am

Biden plan cut in half; funding still in question

Associated Press

WASHINGTON – Half its original size, President Joe Biden's big domestic policy plan is being pulled apart and reconfigured as Democrats edge closer to satisfying their most reluctant colleagues and finishing what's now about a $1.75 trillion package.

How to pay for it all remained deeply in flux Tuesday, with a proposed billionaires' tax running into criticism as cumbersome or worse. That's forcing difficult reductions, if not the outright elimination, of policy priorities – from paid family leave to child care to dental, vision and hearing aid benefits for seniors.

The once hefty climate change strategies are losing some punch, too, focusing away from punitive measures on polluters in a shift toward instead rewarding clean energy incentives.

Pressure mounting, Biden met Tuesday evening with two holdout Democrats – Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, according to a person who requested anonymity to discuss the private meeting. The president is pushing for an agreement before he departs for global summits this week.

All told, Biden's package remains a substantial undertaking – and could still top $2 trillion in perhaps the largest effort of its kind from Congress in decades. But it's far slimmer than the president and his party first envisioned.

House Speaker Nancy Pelosi told lawmakers they were on the verge of “something major, transformative, historic and bigger than anything else” ever attempted in Congress, according to another person who requested anonymity to share her private remarks to the caucus.

“We know that we are close,” said Rep. Joyce Beatty, D-Ohio, the chair of the Congressional Black Caucus, after a meeting with Biden at the White House. “And let me be explicitly clear: Our footprints and fingerprints are on this.”

However, vast differences among Democrats remain over basic contours of the sweeping proposal and the tax revenue to pay for it.

From the White House, press secretary Jen Psaki said Biden still hoped to have a deal in hand to show foreign leaders the U.S. government was performing effectively on climate change and other major issues. But she acknowledged that might not happen, forcing him to keep working on the package from afar.

She warned about failure as opposed to compromise.

“The alternative to what is being negotiated is not the original package,” she said. “It is nothing.”

More lawmakers journeyed to the White House for negotiations Tuesday and emerged upbeat that the end product would be substantial, despite the changes and reductions being forced on them by Manchin and Sinema.

Together the two senators have packed a one-two punch – Manchin forcing supporters to pare back health care, child care and other spending and Sinema causing Democrats to reconsider their plans to reverse the Trump-era tax cuts on corporations and the wealthy.

Resolving the revenue side is key as Biden insists all the new spending will be fully paid for and not piled onto the national debt. He vows any new taxes will hit only the wealthy, those earning more than $400,000 a year, or $450,000 for couples, and corporations he says must quit skipping out on taxes and start paying their “fair share.”

But the White House had to rethink its tax strategy after Sinema objected to her party's initial proposal to raise tax rates on corporations and the wealthy, With a 50-50 Senate, Biden has no votes to spare in his party.

Manchin's resistance may scuttle one other tax idea – a plan to give the IRS more resources to go after tax scofflaws.

He said he told Biden during their weekend meeting at the president's home in Delaware that the plan was “messed up” and would allow the government to monitor bank accounts.

To win over Sinema and others, the Democrats were poised to unveil a new plan for taxing the assets of billionaires.

And on Tuesday they unveiled a proposal to require corporations with more than $1 billion in income to pay a 15% minimum tax, winning Sinema's backing.


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