Happy Friday!
Uphill readers might fondly remember we spent a decent amount of time reading through the House-passed Build Back Better Act late last year. We had almost made it through the whole bill when West Virginia Sen. Joe Manchin cut off negotiations with the White House and announced he wouldn’t vote for it.
Since then, the measure has languished, with Democratic leaders uncertain about their next steps. Now, they are coalescing around a path forward.
Momentum built this week among Democratic lawmakers to accept Manchin’s vision of what the reconciliation package should look like—fewer programs and a smaller price tag—in order to get something done before this year’s midterm elections.
“It’s clear to me that we’re going to have to break it up,” President Joe Biden said during his press conference this week.
What that might look like is far from final, and the effort could collapse again. Manchin said after Biden’s comments that he isn’t currently in talks with Democratic leaders or the White House about a new version of the legislation. “Not yet,” he said. “No one’s come to me.”
It’s clear, though, that he isn’t going to make the discussions easy on his colleagues. On Thursday, he told reporters his earlier offer for a bill is off the table, and negotiators will be “starting from scratch.”
Still, rhetoric from progressives and Democratic leaders signals they’re beginning to accept reality: The package won’t satisfy every stakeholder. Now comes the difficult task of identifying which policies to chop.
Per NBC, Senate Democratic leaders and committee chairs are in talks to draft a scaled-back version of the package that would meet Manchin’s earlier demands. The legislation may include new provisions directing more of the revenue it generates to deficit reduction. It is likely to preserve much of the House version’s climate spending, which is close to $550 billion. Universal pre-kindergarten and an array of health care provisions could also make the cut.
One priority members say they are still fighting for, despite comments from Biden suggesting it might not be included: a version of the expanded child tax credit. The payments, ranging from $250 to $300 per child, were going to roughly 35 million families each month under Democrats’ first reconciliation bill until the provisions expired last month. Manchin has called for more stringent rules for which families get the payments—he argues recipients should have to work, and the payments should not go to families with high incomes. He has also privately raised fears some parents could spend the money on drugs.
Rep. Richard Neal, chairman of the House Ways and Means Committee and author of the child tax credit provisions, said Thursday that he is “certainly not ready to throw in the towel on it.”
“Without volunteering positions, I can think of some room as to what we might do to accomplish it,” he said.
And Sen. Ron Wyden, who chairs the Senate Finance Committee, said he will “fight like hell for it.”
It’s unclear when Democrats might reach an agreement. Biden’s State of the Union address in March could be a time to urge passage of the legislation or an opportunity to take a victory lap if Democrats can agree to a bill before then.
Dissent among congressional Democrats about the party’s strategy has grown louder in recent weeks, with members itching for a bill to tout on the campaign trail. The Washington Post’s Marianna Sotomayor reported Monday that members voiced their frustration in a recent call with House Majority Leader Steny Hoyer:
Members pushed back when Hoyer, reflecting the continued view of House leadership, argued that breaking up the spending bill would mean abandoning the potentially transformative giant package, which he said still has a chance of passage.
“I don’t care,” Rep. Susan Wild (D-Pa.) shot back, telling Hoyer that House Democrats should spend the year sending bills to the Senate with the hope that bipartisan deals could be reached on issues important to a broad range of voters.
Wild later told Sotomayor she doesn’t want the Democratic caucus to “just beat their heads against the wall for months. We need a timeline here.”
Progressives have largely resisted the idea of paring back the legislation, but some appear willing to accept a more limited approach now, after months of gridlock.
And Sen. Ed Markey of Massachusetts said the climate provisions of the bill should be a starting point, and Democrats can “add any of the other important provisions to support working families that can meet the 50-vote threshold.”
Sen. Bernie Sanders, who chairs the Senate Budget Committee, said he has not spoken with Biden directly about pursuing a smaller bill, but he has spoken to some administration officials about it. He argued for a two-step approach, saying Democrats should hold a series of votes on the more sweeping version of the bill to put Republicans, Manchin, and Arizona Sen. Kyrsten Sinema, who has also had concerns about components of the measure, on the record about their stances.
“And if that does happen, if we can’t pass it, then I will come back with very strong pieces of legislation on tax reform, on prescription drugs, on climate change,” Sanders said. “And we go from there.”
This week’s developments emphasized how painful the process has been for Democrats. Months slipped by as Democratic leaders have been frozen between choosing which priorities to include, which stakeholders to disappoint, and which of Manchin’s demands to meet.
In October, House Speaker Nancy Pelosi looked to be getting more realistic about the bill. Amid negotiations with Manchin, who wanted a smaller price tag, Pelosi said members were telling her “overwhelmingly” that they wanted to do “fewer things well” in the reconciliation bill rather than trying to cram as much into it as possible.
But the sweeping bill the House passed weeks later was stuffed with budget gimmicks. Some of the legislation’s provisions lasted a decade, while some only lasted a couple years, a result of Democrats’ attempts to make the bill cost less than if the spending were spread over the same time period.
There’s a reason for the impasse: Democratic leaders are working with extremely narrow margins in the House and no margin at all in the Senate, so nearly every congressional Democrat must be happy with the package for it to pass.
“We need to get as much as we can across the finish line,” Sen. Elizabeth Warren, a progressive from Massachusetts, told reporters Wednesday night after Biden’s remarks. “It’s hard, because we have the skinniest possible majority, and that means it takes every vote. So we need to do what it takes to get every vote.”
Because Democrats set expectations high early on, voters may consider the bill that could ultimately pass a disappointment, even though it might be impactful in many ways.
Liam Donovan, a lobbyist at Bracewell LLP and a former Republican political operative, has followed the maneuvering closely. He said Democrats “knew they were grappling with these tensions and deliberately chose the path of least resistance by delaying the hard choices and trade-offs.”
“Even ‘break it up’ seems designed to obscure what’s happening here,” he told The Dispatch. “They’ve been so busy trying to keep every part of the coalition happy that they’ve created outsized expectations and set themselves up for a painful let down.”
Bill to Watch
Rep. Mike Gallagher, a Wisconsin Republican, introduced legislation this week to sanction International Olympic Committee officials for their handling of the Chinese tennis star Peng Shuai’s disappearance.
Rather than stand up for athletes, the IOC “has chosen its own self-interest and been complicit in the CCP’s human rights abuses,” Gallgher said.
“Boycotting the Olympics is not enough,” Gallagher argued. “It’s time to sanction IOC President Thomas Bach and any other IOC official who helped cover up Peng’s disappearance.”
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