WASHINGTON – West Virginia Sen. Joe Manchin III, a crucial Democratic swing vote in the equally divided Senate, became the first senator Wednesday to say he’s not ready to support the $3.5 trillion spending topline that party leaders agreed to for a budget reconciliation package.
In a statement, Manchin promised to “reserve any final judgement” until he’s had an opportunity to review the proposal, while raising some key questions about what Budget Committee Democrats agreed to Tuesday night in a meeting with Senate Majority Leader Charles E. Schumer and White House officials.
“I’m also very interested in how this proposal is paid for and how it enables us to remain globally competitive,” he said.
President Joe Biden and top Democrats have proposed raising the corporate tax rate, implementing a new floor for multinational corporations’ tax liability overseas and other revenue raisers that businesses have criticized.
Schumer said Tuesday night in announcing the agreement alongside the Budget panel members that the $3.5 trillion topline will fund “every major program” Biden proposed in his economic plans.
Those include subsidies for child care, universal prekindergarten education, two years of free community college, paid leave, home health care and workforce development programs. Senate Democrats are also planning to add an expansion of Medicare to cover dental, vision and hearing benefits.
That funding would come on top of a separate, bipartisan plan to spend about $579 billion on physical infrastructure programs over the next five years, such as highways, bridges, subways, airports, water projects, rural broadband and electric vehicle charging stations.
Senate negotiators are still working with the White House on offsets for that separate package, but have said it will include things like more IRS resources to collect taxes, customs user fees, Strategic Petroleum Reserve sales and chemical industry fees.
Combined with the still-evolving Democratic budget plan, the total price tag for the “hard” and “soft” infrastructure plans, as they’re being referred to, would be $4.1 trillion.
Democratic Sen. Mark Warner of Virginia, a key centrist on the Budget Committee, said Tuesday night the $3.5 piece trillion will be “fully paid for,” but he didn’t say how much of the cost would be offset from new revenues and how much would be from other savings.
Budget Chairman Bernie Sanders, I-Vt., said the revenue target is “still evolving,” but the group has a general idea of how much would be paid for with tax increases versus other budgetary savings from policies like lowering prescription drug costs.
Senate Finance Chair Ron Wyden, D-Ore., also indicated that the exact combination of offsets is still being worked through and that there were some discussions in the caucus about whether to use dynamic scoring methods that take long-term growth impacts into account.
Biden is joining Senate Democrats for lunch in the Capitol on Wednesday to help leadership sell the budget agreement to the broader caucus.
Schumer began that pitch in floor remarks Wednesday, calling it a “landmark agreement” that will “pave the way for historic legislation later this year.”
“Very simply, this budget resolution will allow us to pass the most significant legislation to expand support and help American families since the New Deal — since the New Deal,” Schumer said. “This is generational, transformational change to help American families.”
On the climate front, an important component of the larger package for progressive Democrats, Schumer said the topline will allow for spending on clean and renewable power, resiliency projects, green housing and more proposals from Biden’s plans. Senate Democrats will also add provisions to reduce methane emissions, he said.
Once the broader caucus signs off on the $3.5 trillion spending target or a different number, the Budget Committee will draft a fiscal 2022 budget resolution with reconciliation instructions further breaking down the topline into allocations for committees of jurisdiction to write the implementing legislation.
Schumer wants the Senate to adopt the budget resolution before lawmakers leave for the August recess, with hopes of passing the implementing legislation later this fall.
“This is only the first step on a long road we will have to travel and must travel,” Schumer said. “But we are going to get this done, because we so fervently believe that we must make average American lives a whole lot better.”
