WASHINGTON — Democrats stepped closer to an agreement on President Joe Biden’s agenda as Sen. Joe Manchin, who has been pushing to shrink the size of the package, said a deal on the outlines of the plan is within reach this week.
Manchin’s comments on Monday mark a turnabout from his forecast last week of drawn out negotiations and are the best recent sign for Biden’s domestic agenda after months of intra-party wrangling over tax and spending increases.
An agreement could allow the House this week to pass a $550 billion infrastructure bill. Progressive Democrats in the House have held up that legislation until there’s agreement within the party on the broader package, which includes spending on social programs and measures to address climate change.
Manchin said he hasn’t moved on his insistence that the overall price tag for the tax and spending package be limited to $1.5 trillion rather than the $3.5 trillion originally set out by Democratic leaders. And he indicated all the details won’t be settled this week.
“Having it finished with all the ‘t’s’ and ‘i’s’ and everything crossed and dotted will be difficult from the Senate side because we have an awful lot of text to go through,” Manchin said. “But as far as conceptually, we should. I think a framework should be” agreed on this week.
Senate Majority Leader Chuck Schumer said on the Senate floor that Democrats are “on track to get this done.”
Manchin is a pivotal player in negotiations on the tax and spending package and a key vote in the 50-50 Senate. He met on Sunday with Biden and Schumer in an effort to break a monthslong stalemate. Biden said Monday he hopes to get an agreement on the plan before he leaves Thursday for summits in Europe that include a U.N. climate change conference in Glasgow, Scotland.
“It’d be very, very positive to get it done before the trip,” Biden told reporters.
Schumer said there are “three to four outstanding issues” that remain to be resolved on the larger tax and spending package. He said he wants to nail down the climate provisions before the president leaves for Glasgow.
One of those is how to pay for the package. Manchin, of West Virginia, had supported rolling back some of the Trump tax cuts for high earners and corporations, as Biden proposed. He said he is open to that plan with a so-called billionaires tax on assets. That has been part of the discussions since Arizona Sen. Kyrsten Sinema signaled her opposition to the original tax hike plan.
The tax would apply to a wide variety of items like stocks, bonds, real estate and art, with gains in value taxed on an annual basis, regardless of whether or not the asset is sold. Annual decreases in value could also be deducted, according to a version of the proposal, which dates to 2019.
Other tax proposals in flux include a possible two-year suspension of the $10,000 cap on state and local tax deductions, the imposition of a minimum corporate income tax and a stock buyback tax.
On health care policy, Manchin indicated there are still differences between him, Biden and progressive Democrats. Manchin has resisted expanding Medicare to include dental, hearing and vision benefits. He said Monday that because the program faces insolvency in five years it shouldn’t be expanded without addressing deeper fiscal problems.
“You’ve got to stabilize that first before you do an expansion,” he said. He also said he is opposed to a proposed expansion of Medicaid eligibility to states which have so far refused to expand the program, because states like West Virginia would still be paying part of the costs while the newly eligible states would get a free ride.
“The problem I have with that one is right now we’re paying 90/10. For states that held out to get rewarded with 100% that’s not fair,” he said.
Manchin and Sinema have been using their leverage to force changes in the plan. Manchin’s opposition to Biden’s “Clean Electricity Performance Program,” a centerpiece in the climate provisions, has caused that $150 billion item to be dropped.
He said Monday he is working with Biden to bolster renewable energy tax credits and incentives for energy efficiency.
Many of Biden’s original priorities appear on track to remain in the package but at a shorter duration than originally proposed. These include Affordable Care Act premium subsidies, universal prekindergarten, renewable energy tax credits, earned-income tax credit expansion, housing rental vouchers and mortgage assistance and clean water funds.
