Sen. Joe Manchin (D-W.Va.) is sketching out his vision for what a scaled-down budget bill could look like as his party eyes a second run at moving a major policy bill through a reconciliation process that would negate a GOP filibuster.
This time, however, Democrats are playing down the chances for an imminent deal.
Manchin in December nixed the roughly $2 trillion House-passed Build Back Better package, sending the party into a legislative depression.
The party now faces significant hurdles to renew the tax-and-spending plan at the heart of their agenda as they feel growing pressure to provide deliverables to their own voters.
Sen. Dick Durbin (Ill.), the No. 2 Senate Democrat, said that there were “varying levels of optimism” within the caucus about reviving reconciliation, the budget process that cuts off a GOP filibuster and would allow Democrats to pass a measure with votes just from their members.
“I am the most skeptical,” Durbin said. “I want to see the results. I want to put two of my colleagues in the room with a blank sheet of paper and ask them, ‘What will you agree to?’ There seems to be some problems with that.”
Sen. Ben Cardin (D-Md.) indicated that Democrats were largely delegating talks with Manchin about reconciliation to Senate Majority Leader Charles Schumer (D-N.Y.).
“You’re not going to hear much about it until a decision is made,” Cardin said. “There’s been no reports to us, and we don’t expect any reports.”
Democrats and the White House have acknowledged that there are conversations going on, but they are also being careful to draw hard red lines or hype their talks after they set deadlines, and missed them, repeatedly last year.
“We always are hopeful. That’s all I’m saying,” said Sen. Sherrod Brown (D-Ohio), the chairman of the Senate Banking Committee.
Manchin on Tuesday met with Schumer about how to combat inflation.
After the meeting, the West Virginia senator said he thought the focus of any reconciliation bill should be lowering inflation and deficit reduction.
Manchin indicated that the way to do that included making changes to the tax code.
He outlined part of what he could support on tax changes as part of a reconciliation bill, including increasing the corporate rate to 25 percent, putting capital gains at 28 percent, getting rid of “loopholes” and “making sure everyone pays their fair share.”
Manchin also wants half of any revenue to go toward deficit reduction, saying that it’s the “only way you’re going to fight inflation.”
“Just a fair, competitive tax code,” Manchin added about what he wants to see in a reconciliation bill.
Both Manchin and Schumer tamped down any expectation that they were deep in the sort of formal negotiations that could cement a quick agreement that would allow the party to finally move what was meant to be the center of its legislative agenda.
“There’s nothing formal. There’s no false hopes here. There’s nothing, as far as Build Back Better, there’s no talk about any of that. Just saying how do we get a handle on inflation,” Manchin said.
Schumer also stressed that the talks with Manchin were “preliminary.”
“Our meetings were both preliminary and good, and we’re going to continue to keep talking. If you want to get rid of inflation, the only way to do it is to undo a lot of the Trump tax cuts and raise rates,” Schumer said.
Democrats are facing growing calls from within their own party to try to quickly show voters that they can deliver heading into a November midterm election where they could face tough political headwinds that threaten their ability to hold on to the chamber.
“As Democrats, we need to deliver. We need to hit costs head on, and we have the power to do that. We’ve got less than 200 days left, though, and instead of looking backwards, let’s look forward. Let’s get done what we can get done for the American people who elected us, for the American people who are counting on us,” Sen. Elizabeth Warren (D-Mass.) said during an interview with CBS News’s “Face the Nation.”
Sen. Tim Kaine (D-Va.), asked by The Hill about Democrats’ ability to get a deal this year compared to 2021, pointed to pressure from their base, saying, “I think our voters want us to.” Kaine is among the Democrats who are floating Memorial Day as a deadline for having an agreement on a revived bill, even if they don’t have final legislative text.
“We either have a handshake deal or I don’t think it’s going to get done. I’d love to be wrong,” he said.
But bringing back reconciliation would be a significant lift for Democrats and the White House.
To pass a bill under reconciliation, Democrats would need total unity from all 50 members of their Senate caucus and nearly every House Democrat.
That will be difficult. Manchin’s stance on increasing the corporate tax rate is at odds with Sen. Kyrsten Sinema (D-Ariz.), another moderate, who has said she won’t raise taxes if it harms the economy
And Manchin’s push to boot “social” programs out of Build Back Better could also spark pushback from fellow Democrats, who view reconciliation as their best shot at expanding Medicare, shoring up ObamaCare or creating programs like paid leave or beefing up the child tax credit.
“I really want the workforce and child care to be a part of it,” Kaine said, asked about a reconciliation bill that just focused on inflation and deficit reduction.
Other Democrats said that they would be willing to use Manchin’s skinny version as a starting point, if it meant the party could finally get to a deal.
“I hope we can do something,” said Sen. Mazie Hirono (D-Hawaii). “We should move things along. And Joe is open to tax reform. … I can start with that.”