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State of the Union address will seek to revive dormant budget reconciliation bill

President Joe Biden's prized domestic priority has languished amid a spat with Sen. Joe Manchin III

President Joe Biden, shown with Vice President Kamala Harris in January, will call on Congress to send him legislation that cuts the cost of everyday expenses working families face, a senior administration official said.
President Joe Biden, shown with Vice President Kamala Harris in January, will call on Congress to send him legislation that cuts the cost of everyday expenses working families face, a senior administration official said. (Bill Clark/CQ Roll Call file photo)

President Joe Biden will use part of his first State of the Union address Tuesday to revamp his pitch to Congress on passing his stalled social safety net and climate package, focusing on how the budget measure can lower costs for families and reduce the deficit.

The messaging shift seems designed to appeal to a Democratic senator holding up the budget reconciliation package, West Virginia’s Joe Manchin III, as well as a broader electorate worried about inflation driving up the cost of living.

“The president will call on Congress to send him legislation that reduces the cost of everyday expenses that working families face and reduces the deficit by rewarding work, not wealth,” a senior administration official told reporters Monday on a call previewing the economic portions of Biden’s address.

“He will lay out specific practical measures that would reduce costs for families right now, including prescription drug costs and health care premiums, child care costs and energy costs,” an official added. “He will also point to the other ideas he has proposed on areas ranging from housing to care for seniors and people with disabilities to higher education affordability to direct tax relief for families.”

Those policy ideas are all part of a $2.2 trillion budget reconciliation package the House passed in November that Manchin is opposing.

The administration officials did not mention Manchin or whether Biden would pitch a scaled-down version of the package that the West Virginia Democrat can support. But their emphasis on lowering costs for families and reducing the deficit drive at Manchin’s primary concerns, which is that Democrats shouldn’t approve trillions of dollars in new spending while inflation remains high, and that the party needs to focus more on fiscal responsibility.

Democrats also appear to be rebranding the measure, which they previously dubbed “Build Back Better,” after Biden’s 2020 campaign slogan. In recent months, some top Democrats, including Speaker Nancy Pelosi, have suggested it may need a new name, as the measure stalled and is likely to undergo significant changes in the Senate.

The administration officials demurred when asked if Biden would actually use the words “Build Back Better” in his speech. “It’s not about the name of the bill. It’s about the ideas. It’s about lowering costs for families,” one official said.

The aides didn’t say whether Biden would call for a specific deficit reduction target, but they noted their belief that the budget reconciliation package would reduce the deficit. The measure is largely paid for through tax increases on corporations and wealthy individuals, prescription drug cost savings and enhanced tax enforcement.

The Congressional Budget Office does not predict revenue gains as generous as the White House does from increased IRS spending to boost tax enforcement and, as a result, estimated the package would increase deficits by $160 billion over 10 years. Taking the Treasury Department’s more ambitious revenue estimate from tax enforcement, the White House last year produced an informal estimate that said the measure would reduce deficits by more than $100 billion in the first decade and by as much as $2 trillion in the second.

It’s unclear if Biden will pitch additional offsets in his State of the Union speech. The administration officials said only that they would “outline proposals to make sure that corporations and the wealthiest Americans pay their fair share while making clear that no one making under $400,000 a year should see their taxes increase.” That would apply to the limited tax increases in the package, as well as others like rate increases that Biden proposed but Congress cut amid opposition from Sen. Kyrsten Sinema, D-Ariz.

Lowering costs of everyday expenses while reducing the deficit is just one plank of a four-part economic plan Biden plans to lay out in his State of the Union address. He will also discuss ideas for strengthening supply chains and making more goods in America; promoting competition to lower prices while protecting consumers and helping small businesses thrive; and eliminating barriers to good-paying American jobs.

Other domestic priorities

In addition to the social safety net and climate package, Biden will ask Congress to act on several other measures that have stalled in the Senate after House passage: a labor package designed to strengthen collective bargaining rights; a bill that seeks to eliminate gender pay disparities; a measure to increase the minimum wage to $15 per hour; and legislation enacting a national paid family and medical leave program, which the House included in the budget reconciliation package.

The Senate will most likely not heed many of those requests, given Republican opposition to the proposals and the need for 60 votes to end debate on legislation outside of the budget reconciliation process.

In a request Congress may be able to meet, Biden will call on lawmakers to send him bicameral competitiveness legislation reconciling House and Senate bills designed to boost domestic research and development, innovation and production to allow the U.S. to better compete with China.

Biden will also tout the economic benefits of legislation Congress passed last year, including a $1.9 trillion coronavirus relief law and a bipartisan infrastructure law.

He will lay out specific infrastructure metrics he expects to meet in the coming year of the latter law’s implementation, including improving 65,000 miles of roads and 1,500 bridges; over 600 airport projects; 15,000 new public transit buses, ferries and subway cars; more than 500 Army Corps of Engineers projects to strengthen supply chains, improve waterways and reduce flooding; and about 400 new water projects replacing lead pipes and improving drinking water.

Biden will also announce executive orders focused on antitrust actions designed to lower costs in the ocean shipping industry and initiatives to improve conditions in nursing homes. In addition to the Centers for Medicare and Medicaid Services-led initiatives for the latter, Biden will call on Congress to appropriate nearly $500 million to CMS to support health and safety inspections at nursing homes and to raise the dollar limit on financial penalties levied on poor-performing facilities from $21,000 to $1,000,000 per instance.

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