Biden shared breakfast at the White House with Nancy Pelosi, House Speaker. Chuck Schumer, Senate Majority Leader, joined in a call from New York. They have been working together with progressives and party moderates to reduce the 10-year, once-$3.5 trillion package of social services to about $2 trillion. This is in an effort to reach an agreement.
Pelosi stated that a deal was possible.
Back at the Capitol, she told reporters that over 90% of the package had been agreed to. The climate change elements of the bill were “resolved,” but there are still questions about the health care provisions.
Pelosi stated that she hoped that the House would begin voting next week. However, no timetable was established.
“Much of the work we need has already been done. Pelosi stated that there are only a few decisions left.
Democrats have set an informal goal to agree to a draft of their plan by the end this week. Leaders hope that a broad agreement between moderates and progressives in the party on the measure’s price tag and revenue sources could lead to final agreements on details legislation.
Democrats are seeking to reach an agreement on the legislation before Biden leaves for Europe in late next week.
Jen Psaki, press secretary at the White House, stated that the president “has rolled up his sleeves” and is “deep in the details of spreadsheets numbers.”
Psaki likened the work to the beginning of Social Security and other federal programs decades ago and then building upon them over time.
“Progress here, is a historic package which will put in place programs and systems that have never existed before in our society,” she stated. She also noted the efforts to expand child care and offer free pre-kindergarten to all children.
Negotiations continue as Biden appeals more strongly to the American public in televised town halls Thursday for the middle-class values that are at the core of his proposal.
Biden cannot afford to lose one vote in a Senate that is equally divided between Republicans and Democrats. Biden is trying to navigate his party’s factions: progressives who want large investments in social services and centrists who would prefer to see the overall cost go down.
“When you are president of the United States, there are 50 Democrats. Every one of them is a president. Each and every one. He said that it was up to you to make things work out.
He expressed optimism and continued to believe in the process. It’s all about compromise. He said that compromise has become a dirty word but that bipartisanship and compromise are still possible.
Biden stated that the discussions have been reduced to “four or five issues.”
One issue, the taxes that will pay for the package. The White House seemed to be moving forward with a new strategy. Instead of reversing Trump’s tax cuts, the White House would tax billionaires’ investment incomes to finance the deal.
Biden was met with resistance by key holdouts, including Sen. Kyrsten Silena (D-Ariz.), who is not onboard with her party’s plan to repeal President Donald Trump’s tax breaks for large corporations and individuals making more than $400,000 per year.
Thursday night was unusually open with the president about the sticking points in negotiations with Sinema, and another key Democrat Sen. Joe Manchin from West Virginia.
Although Sinema said that Sinema would not raise taxes on corporations or the wealthy, a White House official clarified later that the president was talking about raising top tax rates and not the range of tax proposals which Senator Sinema supports.
This could be a key part of a deal. If Democrats have a better understanding about the revenue available, they can develop a topline amount for spending on the package and adjust the duration of various programs accordingly.
Biden stated that Manchin does not want to rush the transition to clean energies so it will cause major job losses in his state of coal-producing.
Biden admitted that he had made major changes to his original vision.
Although he acknowledged that the final plan would not provide community college for free, he said a few things: he hopes to increase Pell Grants in order to make up the difference.
He stated that the federally-paid, long-term family leave program had been reduced to just four weeks from what was originally planned.
A second work in progress is Sen. Bernie Sanders of Vermont, an independent. He has made it a priority to expand Medicare to include hearing, vision, and dental benefits for seniors.
Biden stated that he liked the idea. However, Sinema and Manchin objected to the proposal, so the proposal was “a reach.”
He said that Democrats are instead considering giving seniors a $800 voucher to get dental care and another program for hearing aids, which Sinema might support. Biden stated that the vision care issue is more difficult to solve and that there has not been a consensus.
Biden and his party seek to strengthen middle-class households, combat climate change, and make sure that the richest Americans and corporations contribute what he calls “fair share” to the country.
The mix includes at least $500 billion to combat climate change, $350 Billion for child care subsidies and prekindergarten, a one year extension of the $300 monthly child credit, which was established during the COVID-19 crises, and money for healthcare provided by the Affordable Care Act.
However, the newly proposed tax provisions have upset Democrats who have long campaigned to scrap Republican-backed tax cuts. Many believe these tax cuts unduly reward wealthy people and cost the government huge amounts in lost revenue during a time of growing income inequality. It is a shame that a single senator could hinder this goal.
The 21% corporate rate and the top rate of 39.6% for those earning $400,000 (or $450,000 for couples) would not be affected by the proposed changes.
However, the revisions will not be positive for large companies or the wealthy.
The White House has revived the idea of a 15% minimum corporate rate for tax, as Biden proposed earlier this year. This applies to companies with no taxable income, which is a common target for Biden who complains that they pay “zero” taxes.
The Senate Finance Committee chairman, Sen. Ron Wyden (D-Ore.), would model the new tax on the richest individuals on legislation. He proposed taxing stock gains for people who have more than $1B in assets — less than 1000 Americans.
