On The Money — Manchin slams brakes on Biden spending push

Manchin slams brakes on Biden spending push

Happy Monday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: digital-stage.thehill.com/newsletter-signup.

Today’s Big Deal: Sen. Joe Manchin (D-W.Va.) has some concerns about the Democratic spending agenda with little time for the party to adjust course. We’ll also look at climate-related concerns about Jerome Powell and a progressive push to defend Biden’s tax plan. 

But first, find out why the Federal Trade Commission is probing McDonald’s’s chronically broken ice cream machines. 

For The Hill, I’m Sylvan Lane. Write me at slane@digital-stage.thehill.com or @SylvanLane. You can reach my colleagues on the Finance team Naomi Jagoda at njagoda@digital-stage.thehill.com or @NJagoda and Aris Folley at afolley@digital-stage.thehill.com or @ArisFolley.

Let’s get to it.

Manchin warns Democrats: Hit ‘pause’ on Biden’s $3.5T plan

Sen. Joe Manchin (D-W.Va.) said Democrats should hit “pause” on President Biden’s $3.5 trillion spending package, firing a significant warning shot at his party’s top legislative priority.

Manchin, during remarks this week at a West Virginia Chamber of Commerce event pointed to concerns about “runaway inflation,” the delta variant of the coronavirus and a botched withdrawal in Afghanistan to float slowing down what is the centerpiece of Biden’s economic agenda. 

“If the country is facing what we’re facing now. … I would ask my colleagues and all of the Senate to hit the pause button on the $3.5 [trillion],” Manchin said at the event on Wednesday. “Let’s sit back. Let’s see what happens. We have so much on our plate. We really have an awful lot. I think that would be the prudent, wise thing to do.” 

Manchin doubled down on his remarks, which were made Wednesday, in a Wall Street Journal op-ed on Thursday, warning he can’t support a $3.5 trillion plan.  

• Manchin previously warned that he had “serious concerns” about a $3.5 trillion package in a statement released hours after the Senate passed the roughly $1 trillion bill last month that he and a bipartisan group of senators helped negotiate. 

 

• But his new remarks come as Democrats are negotiating and drafting the $3.5 trillion bill, which is expected to include some of the party’s biggest priorities including expanding Medicare, combating climate change and immigration reform. And if he sticks by his push for a go-slow approach, it could mark a significant stumbling block to Democratic leadership’s timeline for advancing the Democratic-only bill. 

The Hill’s Jordain Carney has it all here.

The pushback: Naturally, Manchin’s message didn’t sit well with progressive lawmakers— who have insisted on voting for the Democratic reconciliation bill before passing the Senate-approved bipartisan infrastructure bill specifically because they feared the larger measure would face opposition from moderates.

• “Manchin has weekly huddles w/ Exxon & is one of many senators who gives lobbyists their pen to write so-called ‘bipartisan’ fossil fuel bills. It’s killing people. Our people. At least 12 last night. Sick of this ‘bipartisan’ corruption that masquerades as clear-eyed moderation,” tweeted Rep. Alexandria Ocasio-Cortez (D-N.Y.). 
• House Progressive Caucus Chairwoman Pramila Jayapal (D-Wash.) also rejected the idea of a pause, tweeting: “Absolutely not.” 

The real price tag? “The bill will not cost $3.5 trillion. The Finance Committee has a large menu of offsets. Thank you for coming to my TED Talk,” tweeted Ashley Schapitl, a top aide to Senate Finance Committee Chairman Ron Wyden (D), who will help craft the tax provisions of the bill.

LEADING THE DAY

Progressives prepare to launch counterattack in tax fight

Progressive groups are gearing up to promote President Biden’s proposals on tax hikes for wealthy individuals and corporations as Democrats in Congress move forward with drafting a multitrillion-dollar social spending package.

• Biden and congressional Democrats aim to pay for new spending in areas such as education, health care and climate through those tax increases. 
• But business groups are funding a lobbying blitz against the proposals, targeting Democratic lawmakers who have raised concerns about the tax plans.

Progressive advocacy organizations and labor groups hope to counteract K Street’s lobbying push and keep Democrats united. They’re arguing that proposals to raise taxes on wealthy people and corporations are in line with public sentiment.

“Taxing the rich is incredibly popular, and so I think we need to remind some Democrats about that,” said Maura Quint, executive director of the progressive group Tax March. “Ultimately, I do believe that Democrats in general support Biden’s plans.”

The Hill’s Naomi Jagoda tells us how they’re going to do it here.

 

GALE-FORCE WINDS OF CHANGE

Climate hawks pressure Biden to replace Fed chair

Environmentalists are pressing President Biden to factor in the Federal Reserve’s record on climate change under Jerome Powell when he decides whether to renominate the central bank’s chairman for a second term.

After a summer of brutal heat domes, forest fires and torrential storms capped off by Hurricane Ida, progressive lawmakers and activists are urging Biden to wage an offensive on climate change through the Fed.

The background: 

• Unlike its counterparts in the United Kingdom and European Union, the Fed had tiptoed around the discussion of the financial risks of climate change until shortly after Biden’s election in November. 
• They’ve done little more than join and create a few committees on the subject, which was enough to enrage Republicans while underwhelming climate activists.

“We are not climate policymakers here who can decide the way climate change will be addressed by the United States. We’re a regulatory agency that regulates a part of the economy,” Powell, a Republican, told lawmakers during a February hearing, one year out from when his term expires. 

But with time now a key factor in the fight against climate change, environmental advocates are jumping into the debate over Powell’s future and insisting Biden must nominate someone willing to turn the Fed against the fossil fuel industry, instead of giving Powell another four years at the helm. I have more here.

DELTA BLUES

Jobless claims fall by 14K despite delta layoff fears

New weekly applications for jobless benefits hit a new post-lockdown low last week despite rising COVID-19 cases driven by the delta variant, according to data released Thursday by the Labor Department.

• In the week ending Aug. 28, the seasonally adjusted total of initial claims for unemployment insurance totaled 340,000, falling by 14,000 from the previous week’s revised level. The previous week’s total was revised up by 1,000 claims.
• On an unadjusted basis, claims totaled 287,751, falling 11,040 from the previous week’s unadjusted total.
• The number of claims for Pandemic Unemployment Assistance, a program created for gig workers and contractors, sunk by 14,020 to 102,405 after a jump of roughly 8,000 in the previous week.

While jobless claims data is volatile and often distorted by state processing issues, the continued decline of new applications suggests that the delta surge has not led to widespread layoffs. I break it down here.

 

Good to Know

About two-thirds of registered voters favor boosting the IRS’s budget to increase tax enforcement on high-income taxpayers, which President Biden has proposed as a way to help pay for Democrats’ multitrillion-dollar social spending plan, according to a recent University of Maryland poll.

Here’s what else have our eye on:

• House Budget Committee Chairman John Yarmuth (D-Ky.) all but formally endorsed Federal Reserve Chairman Jerome Powell for another term amid growing liberal pressure on President Biden to replace him.
• Capital One CEO Richard Fairbank will settle charges by the Federal Trade Commission of violating antitrust laws, the agency announced.
• The Biden administration is sitting on enough emergency funding to cover the “immediate” aftermath of a recent scourge of natural disasters, including the path of destruction left by Hurricane Ida, sources said Thursday.
• WhatsApp on Thursday was fined roughly $267 million by Ireland’s privacy watchdog due to alleged violations of the European Union’s data privacy rules, the largest penalty issued yet by the group since the strict 2018 regulations took effect. 

 

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you Friday.