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Pelosi aims to light fire under budget package negotiators

Speaker says Rules Committee will meet to consider reconciliation package; bill text, timing still in flux

Speaker Nancy Pelosi talks with reporters Wednesday after a meeting of the House Democratic Caucus in the Capitol.
Speaker Nancy Pelosi talks with reporters Wednesday after a meeting of the House Democratic Caucus in the Capitol. (Tom Williams/CQ Roll Call)

House Democratic leaders sought to increase pressure for a deal on their mammoth spending and tax package that would allow a vote this week on a bipartisan infrastructure bill that faces a Halloween deadline.

Speaker Nancy Pelosi, D-Calif., said the House Rules Committee would hold a “hearing” Thursday on the still-unfinished Democratic budget reconciliation package to expand the social safety net and combat climate change. Progressives have said they would not vote for the infrastructure bill, offering $550 billion in new public works money, without a vote on the broader social spending bill.

With reconciliation talks still bogged down over several sticking points, Pelosi sought to quicken the pace. The clock is ticking for passage of the infrastructure bill because a short-term extension of federal highway and transit programs is set to expire Sunday.

Pelosi wrote in a letter to her caucus that they face a “crucial deadline” on the infrastructure bill, but that to take that up “we must have trust and confidence in an agreement” for the reconciliation package to also pass.

But as talks continued, it wasn’t clear a deal would be in hand before the Rules Committee meeting Thursday. Rules Chairman Jim McGovern, D-Mass., promised only to “begin the hearing” and determine how to proceed later. “We’re moving forward because we have to get this done,” he told reporters.

Lawmakers and staff already have large chunks of the package drafted, but are still rewriting or adding new sections on a handful of outstanding sticking points. Rep. Scott Peters, D-Calif., said Rules might start working through text that’s available in time for the start of the Rules session and then a managers amendment could be incorporated later.

“The process needs to get started because it could take all day,” said Peters, who’s been among the Democratic holdouts on prescription drug price negotiation language intended to offset part of the bill. He said he is waiting to see compromise language Senate Finance Committee members have been working on.

House Democrats planned to meet at 9 a.m. Thursday to discuss progress on the bill and the path forward. A special guest was scheduled to visit to try to sell the rank-and-file on what’s been worked out so far: President Joe Biden, before he leaves for the G-20 summit in Rome later on Thursday.

‘What deal?’

Other lawmakers seemed taken aback by the decision to schedule the Rules meeting because of so many unanswered questions. “I asked members of the Rules Committee and they said ‘I don’t know what we’re marking, what are we marking up?'” Congressional Progressive Caucus Chair Pramila Jayapal, D-Wash., told reporters. “People are like, ‘Did you sign off on the deal?’ I said, ‘What deal?'”

Jayapal said it might take a few extra days to hammer out agreements and still get both bills done before the transportation bill deadline. “I’m willing to stay over the weekend. If we can get the legislative text done and we can vote both bills out on Sunday, I would do it,” she said.

Pelosi, in her letter, said “great progress” was made on a plan to extend Medicaid coverage in states that opted against expansion under the Obama administration’s health care overhaul, along with expanded subsidies for insurance premiums.

And she claimed “broad agreement” on many other provisions, including an expanded child tax credit, universal prekindergarten, child care and home health care. She also said she was pleased with a “robust” package of measures to combat climate change — an issue that had bogged down talks for months.

Pelosi wrote that party leaders were “still fighting” for paid family and medical leave provisions. But by late afternoon it became clear backers had yet to convince Sen. Joe Manchin III, D-W.Va., who had concerns about creating what would be a new entitlement program.

Democrats had previously agreed to cut the benefit back from 12 weeks to four, but Manchin still wouldn’t budge, according to a source familiar with the talks. Sen. Kirsten Gillibrand, D-N.Y., had been negotiating alternatives with Manchin, including a 12-week benefit just for parents of newborns, but those talks seemed to hit an impasse Wednesday.

In a statement, Gillibrand vowed to keep pushing for a paid leave benefit “until the bill is printed.”

Added Senate Health, Education, Labor and Pensions Chair Patty Murray, D-Wash.: “We are not going to allow one or two men to tell women, millions of them in this country that they can’t have paid leave.”

Highway extension mulled

Several other big sticking points remain, raising doubts that an infrastructure bill could pass this week.

To avoid a lapse in highway and transit programs, lawmakers began preparing another short-term extension as a fallback option. Sen. Shelley Moore Capito, R-W.Va., said that extension was likely to last through Dec. 3. That’s the same day stopgap funds for federal agencies would run dry without an omnibus fiscal 2022 appropriations package or another temporary funding bill.

House Majority Leader Steny H. Hoyer, D-Md., said a short-term extension remains “one option” if lawmakers can’t pass the broader infrastructure bill this week.

And progressives made clear again Wednesday that any “framework” deal on the reconciliation package would not be sufficient to win their votes for the infrastructure bill.

“We’ve had frameworks for six months,” said Rep. Alexandria Ocasio-Cortez, D-N.Y. “And we’ve seen how much those frameworks have changed and been taken back.  . . .  We need confirmed text.”

One of the major points of contention was whether progressives’ prized expansion of Medicare coverage to dental, vision and hearing benefits would survive the negotiations.

Manchin said Wednesday he had a hard time expanding Medicare when at the same time the program was facing solvency issues within the next decade.

The dental, vision and hearing benefits, while expensive, would be covered under Part B of Medicare, not Part A hospital coverage, which is financed through payroll taxes and in danger of running dry without fixes. Nonetheless, Part B coverage even under current law is the fastest growing component of Medicare, according to the Congressional Budget Office, and Medicare as a whole is already expected to have to rely more on deficit-financing than income from premiums and payroll taxes by the end of the decade.

Democrats were seeking to whittle down the cost, including with a voucher program for dental benefits, which are the most expensive. But progressives were adamant that the Medicare benefits remain in the bill. “That has to be in there,” Rep. Ro Khanna, D-Calif., said.

Khanna, who was a co-chair of Senate Budget Chairman Bernie Sanders‘ presidential campaign, said that for Sanders’ “whole life, he’s fought for this. And we will support him, we’ll back him up and if he thinks something is adequate then fine, but if he doesn’t, then it’s not going to have support here.”

Tax questions

Another big remaining obstacle is how to pay for a package that is expected to cost somewhere around $2 trillion over the next decade.

Democrats have promised the measure would be “fully paid for” so as not to add to the mounting debt. It’s not exactly clear what that means, however, and documents circulating around Capitol Hill and K Street suggested Democrats may try to claim hundreds of billions of dollars in savings from expected economic growth.

Still, tax increases on corporations and the richest households are likely to be the major moneymakers in the package, even as negotiators largely abandoned plans to increase tax rates on corporations and upper-income households because of opposition from Sen. Kyrsten Sinema, D-Ariz. Her vote would be enough to sink the bill in the evenly divided Senate, where Republicans remain unified against it.

A plan unveiled Wednesday to impose a new tax on the unrealized gains of assets of about 700 billionaires drew a mostly skeptical initial reception.

“Conceptually I’m fine with it,” said Sen. Tim Kaine, D-Va. “It’s just that if you create something new, you have to figure out how to do it and figure out how to implement it and think about other consequences.”

House Ways and Means Chairman Richard E. Neal, D-Mass., said a billionaire’s tax “would be very difficult because of its complexity. None of us in the Democratic caucus in the House have any problem with asking billionaires for more money. That’s fine. But this happened all of a sudden.”

Rep. Bill Pascrell Jr., D-N.J., a Ways and Means member, said he had some concerns with “singling out” billionaires, however. “I don’t like the billionaires’ tax. … I just don’t like it period, generally,” he said, although he added that he is considering it in the context of the overall package.

But the measure’s chief sponsor, Senate Finance Chair Ron Wyden, D-Oregon, said he was “making good progress” on building support. Senate Democrats from across the ideological spectrum “don’t think it’s right that billionaires should be able to go for years and years on end, paying no tax,” Wyden said.

Manchin earlier Tuesday sounded critical of the proposal but didn’t indicate he’d reject it.

“People in the stratosphere, rather than trying to penalize them we ought to be pleased that this country is able to produce the wealth. But with that there’s a patriotic duty that you should be paying something to this great country that gave you the protection and the support and the opportunities,” Manchin said. “There’s people that basically, they’ve contributed to society, they’ve created a lot of jobs, and invested a lot of money and given a lot to philanthropic pursuits. But it’s time that we all pull together and row together.”

Lauren Clason, Mary Ellen McIntire, Jessica Wehrman, Niels Lesniewski and Paul M. Krawzak contributed to this report.

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