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Biden, Top Dems Strategize; Pelosi Says Deal ‘Very Possible’

October 22, 2021by Lisa Mascaro, Darlene Superville and Alan Fram, Associated Press
President Joe Biden and Speaker of the House Nancy Pelosi, D-Calif., walk in a basement hallway of the Capitol after meeting with House Democrats, on Capitol Hill in Washington. (AP Photo/J. Scott Applewhite)

WASHINGTON (AP) — President Joe Biden and Congress’ top two Democrats strategized Friday trying to wrap up their giant domestic legislation, as the party continued scaling back the measure and determining ways to pay for it ahead of new deadlines.

Biden had breakfast at the White House with House Speaker Nancy Pelosi, and Senate Majority Leader Chuck Schumer joined in a call from New York. The leaders have been working with party moderates and progressives to shrink the once-$3.5 trillion, 10-year package of social services and climate change strategies to around $2 trillion, pushing for an agreement.

Pelosi said a deal is “very possible.”

She told reporters back at the Capitol that more than 90% of the package was agreed to — the climate change components of the bill “are resolved,” but outstanding questions remain on health care provisions. 

Pelosi said she hopes the House can start voting on it next week.

“Much of what we need to do has been written. Just a few decisions now,” Pelosi said.

Democrats have set an informal goal of agreeing to an outline of the plan by the end of this week. A broad compromise between the party’s progressives and moderates on the measure’s price tag, revenue sources and basic components could lay the groundwork for final agreements on detailed legislation, leaders hope. 

Democrats want to reach an accord on the legislation before Biden departs for a trip to Europe late next week.

The changes come as Biden more forcefully appeals to the American public, including in a televised town hall Thursday, for what he says are the middle-class values at the heart of his proposal. 

Biden mentioned during the evening event the challenge he faces in wrangling the sharply divergent Democratic factions to agree to the final contours of the bill. With an evenly divided Senate, he can’t afford to lose a single vote, and he is navigating the competing demands of progressives, who want major investments in social services, and centrists, who want to see the price tag on the package come down.

“When you’re president of the United States, you have 50 Democrats — every one is a president. Every single one. So you gotta work things out,” he said during a CNN town hall.

Still, he expressed optimism about the process. “It’s all about compromise. Compromise has become a dirty word, but bipartisanship and compromise still has to be possible,” he said.

Biden said the discussions are “down to four or five issues.”

On one issue — the taxes to pay for the package — the White House idea seemed to be making headway with a new strategy of abandoning plans for reversing Trump-era tax cuts  in favor of an approach that would involve taxing the investment incomes of billionaires to help finance the deal.

Biden has faced resistance from key holdouts, in particular Sen. Kyrsten Sinema, D-Ariz., who has not been on board with her party’s plan to undo President Donald Trump’s tax breaks for big corporations or individuals earning more than $400,000 a year.

The president was unusually forthcoming Thursday night about the sticking points in the negotiations with Sinema and another key Democrat, conservative Sen. Joe Manchin of West Virginia. 

While the president said Sinema “will not raise a single penny in taxes” on the wealthy or corporations, a White House official later clarified that the president was referring to raising the top tax rates, not the range of tax proposals “which Senator Sinema supports.”

If so, that could unlock a key piece of a deal. With a better understanding of the revenues available, Democrats can then develop a topline amount of spending for the package, and adjust the duration and sums for various programs accordingly.

Biden said Manchin doesn’t want to “rush” the transition to clean energy so quickly it will result in major job losses in his coal-producing state.

Even as he seemed encouraged by progress, Biden acknowledged major reductions to his original vision. 

He signaled the final plan would no longer provide free community college, but said he hoped to increase Pell Grants to compensate for the loss of the policy.

He also said that what had been envisioned as a federally paid, months-long family leave program would be just four weeks.

Another work in progress — the idea of expanding Medicare to include dental, vision and hearing aid benefits  for seniors — is a priority for Sen. Bernie Sanders, the independent of Vermont. 

Biden said he likes the idea, but with Manchin and Sinema objecting, the proposal is “a reach.” 

Instead, Democrats, he said are looking at offering seniors an $800 voucher to access dental care as well as another program for hearing aids that Sinema may support. However, the vision care component, Biden said, has been harder to resolve and there is no consensus yet.

Overall, Biden and his party are trying to shore up middle-class households, tackle climate change and have the most wealthy Americans and corporations pay what he calls their “fair share” for the nation.

In the mix are at least $500 billion to battle climate change, $350 billion for child care subsidies and free prekindergarten, a one-year extension of the $300 monthly child tax credit put in place during the COVID-19 crisis, and money for health care provided through the Affordable Care Act and Medicare. 

The newly proposed tax provisions, though, have rankled Democrats who have long campaigned on scrapping the Republican-backed tax cuts that many believe unduly reward the wealthy and cost the government untold sums in lost revenue at a time of gaping income inequality. Many are furious that perhaps a lone senator could stymie that goal.

Under existing law passed in 2017, the corporate tax rate is 21%. Democrats had proposed raising it to 26.5% for companies earning more than $5 million a year. The top individual income tax rate would go from 37% to 39.6% for those earning more than $400,000, or $450,000 for married couples. 

Under the changes being floated the corporate rate would not change. But the revisions would not be all positive for big companies and the wealthy. 

The White House is reviving the idea of a minimum corporate tax rate, and Biden mentioned the 15% rate he had proposed this year. That’s even for companies that say they had no taxable income — a frequent target of Biden, who complains they pay “zero” in taxes.

The new tax on the wealthiest individuals would be modeled on legislation from Sen. Ron Wyden, D-Ore., chairman of the Senate Finance Committee. He has proposed taxing stock gains of people with more than $1 billion in assets — fewer than 1,000 Americans.

___

Associated Press writers Alex Jaffe, Kevin Freking and Zeke Miller contributed to this report.

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