Democratic divisions threaten to bog down Biden’s economic package

CNN

By Manu Raju and Lauren Fox, CNN

Senate Democrats returned to Washington on Monday suggesting they were far away from reaching a deal on a $3.5 trillion economic package, raising fresh questions about whether all 50 members of their caucus can quickly unite behind the centerpiece of President Joe Biden’s agenda amid sharp divisions over the scope of the plan and ambitious timetable for considering it.

Democratic leaders had hoped that the party could coalesce behind a proposal by Wednesday. But a wide range of Democratic senators made clear that Wednesday’s timetable was not achievable, even as party leaders still hope that a bill can be approved by Congress before month’s end — something that would require total party unity in the Senate.

But the party is still at odds over the price tag of the plan, the tax hikes to pay for it, the health care provisions in the proposal and climate provisions key to winning over liberals. And the problems for Democratic leaders go beyond just Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona– two of the party’s most moderate members.

“So, I think a lot of things are going to have to be worked on — a lot of arguments are going to be made,” said Senate Budget Chairman Bernie Sanders, an independent from Vermont who caucuses with the Democrats. “And it’s not just Joe Manchin or Senator Sinema, it’s other people.”

Manchin agreed.

“I think there’s a lot of different colleagues of mine that might share different parts of my position in a more private way,” Manchin, who has called for a “pause” in the consideration of the proposal amid his concerns over inflation and government spending. “And since I’ve been the one on the chopping block here, I want people to know exactly where I stand, so it’s no surprise.”

Indeed, some of the party’s most vulnerable Democrats would not embrace the eye-popping dollar amount.

Asked twice about the $3.5 trillion price tag, Sen. Maggie Hassan of New Hampshire said: “I said I’m running into vote.”

The differences are piling up on a bill that would touch almost every corner of domestic life from education to health care to energy — and also will force Democrats to decide how much to raise taxes on businesses and wealthy Americans just a year before the midterm elections.

On Monday, liberal Democrats made clear they wouldn’t accept a plan that shortchanges efforts to combat global warming — even as Manchin has resisted demands to force the US electric grid to rely heavily on renewable sources of energy over the next decade. Manchin, who represents a coal-producing state, said Sunday that the goal envisioned by Democratic lawmakers “makes no sense at all.”

Progressives scoffed at that comment.

“Everyone gets a chance to kick the tires,” said Rhode Island Sen. Sheldon Whitehouse. “At the end of the day we are going to have a deal, and it is going to be good enough on climate or it won’t go.”

Asked if it was a red line for him, Whitehouse shot back: “It’s pretty red.”

“The urgency of the crisis was made very clear this summer,” said Sen. Ed Markey, a Massachusetts Democrat and outspoken advocate for climate change regulations. “We have to work hard to find a resolution of this issue. But I don’t think we should finish the legislation until there is a clean energy standard.”

The pressure is mounting as Senate is only in town for a truncated week — while the House doesn’t return to session until next week. House Speaker Nancy Pelosi and her leadership team have aimed to vote on the House version of the bill as soon as next week.

That’s in part due to a deal she cut with moderate Democrats who had demanded a vote on the Senate-passed, $1.2 trillion infrastructure package by September 27. But if the economic package stalls, liberals are warning they’ll sink the infrastructure bill as well, meaning Democrats could see months of talks collapse.

On Monday, the House Ways and Means Committee officially rolled out its plans to finance the massive proposal, but many senators were still reviewing the tax hikes, warning that there would have to be further negotiations with the House over the financing mechanisms, before the legislation would be finalized. Plus some moderate Democrats like Sen. Jon Tester of Montana insisted the package’s costs be fully offset.

“My constituents in New Hampshire never like any tax increases,” said Sen. Jeanne Shaheen, the senior Democratic senator from the state. “I think having a tax system that’s fair makes sense.”

Behind closed doors on Monday, talks began in person — including with Manchin and top Democrats in the Senate. For the last month as Congress was on recess, key Democratic chairmen in the House and the Senate have been hashing out their disagreements among their committee members — and also holding separate talks with other lawmakers who have voiced concerns over the policy, including Manchin.

Now that members are back in person, Democratic leaders hope that the differences can be bridged.

“We have work to do,” said Senate Majority Whip Dick Durbin of Illinois. “Everybody is coming back from the August recess. It’s our chance to square off, see one another eyeball-to-eyeball but try to work out our differences. But there are clearly differences.”

But how quickly that happens — and whether Senate Majority Leader Chuck Schumer can get his entire caucus united remains to be seen. Because they are relying on a budget process that cannot be filibustered, Democrats don’t need any Republicans to back it. But they have no margin for error in the 50-50 Senate, while Pelosi can only lose three votes in the narrowly divided House.

“Some people are above 3.5 some people are below,” Schumer said of the total $3.5 trillion price tag for the Democratic-only package. “We’ve all got to come together.”

Asked if he was committed to staying at that number, Schumer said: “I gave you my answer.”

Some Democrats are reacting cautiously.

“I’m not setting a line in the sand on a number, but I do recognize that’s a significant amount of money,” said Sen. Mark Kelly, an Arizona Democrat facing reelection next year, when asked about the price tag. “And I’m going to look at the details of what are we going to get for whatever the top line number happens to be and then how are we going to pay for it.”

The hard choices ahead will force Democrats to grapple with how much of Biden’s ambitious agenda on paid family leave, expanded health care, free Pre-K and community college, will be enacted. But some fear that if the party doesn’t quickly fall in line, the task will only become more daunting.

“We need to keep moving,” said Massachusetts Sen. Elizabeth Warren when asked about Manchin’s call for a pause. “This is hard, but it’s not going to get any easier over time.”

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CNN’s Ted Barrett and Ali Zaslav contributed to this report.