02/20/2022
Joe Biden announced a framework agreement with Democratic leaders on his US economic agenda, in an effort to stoke political momentum for his $1.75tn package after weeks of fraught negotiations.
The president unveiled details of the proposed deal during a meeting with Democrats from the House of Representatives on Thursday morning, then spoke about it from the White House before flying to Europe for the G20 summit in Rome and the COP26 climate conference in Glasgow.
āWe spent hours and hours and hours over months and months working on this. No one got everything they wanted, including me,ā Biden said. āBut thatās what compromise is. Thatās consensus. And thatās what I ran on.ā
Senior administration officials said they were āconfidentā that the proposed deal would garner the support of all Democrats on Capitol Hill, including US senators Kyrsten Sinema and Joe Manchin, two moderate Democrats who have been resisting many elements of Bidenās agenda.
But it was highly uncertain whether Biden would be able to get the deal over the finish line ā as some rank-and-file Democratic lawmakers balked at the plan saying it was insufficient, others demanded to see legislative text which is still not drafted, and insisted that additional changes would have to be made.
The plan sharply pared back the presidentās ambitions to reshape the US economy with government investment. Biden had originally hoped for the package to be worth up to $3.5tn in spending over a decade, but its size has fallen below $2tn.
Still, senior administration officials have touted the importance of the measures that have been retained, including free universal pre-kindergarten education, the extension of a tax credit for children, large investments in climate action worth $555bn and the expansion of government healthcare for seniors to include hearing benefits.
Biden said the legislation would strengthen the economy at home and its competitiveness globally. āItās about leading the world,ā he said.
The plan would be fully paid for through higher taxes on the wealthiest Americans and large companies, Biden said, adding that it was āfiscally responsibleā.
The White House and senior Democrats have been scrambling to find ways to increase taxes in recent days, including a new levy on billionaires that was subsequently dropped.
Biden is now proposing a new 5 per cent surtax on incomes over $10m and an additional 3 per cent surtax on incomes above $25m.
The proposed deal would also include a new 1 per cent levy on share buybacks by the largest companies, as well as a minimum tax to prevent large businesses from taking advantage of multiple tax breaks to lower their tax bills. āAll Iām asking is pay your fair share,ā Biden said.
If the framework is well-received by Democrats in the House ā particularly progressives who have argued against scaling it back ā it could pave the way for the passage of a $1.2tn bipartisan infrastructure deal that was agreed earlier this year.
But it remained unclear on Thursday morning whether the presidentās plan would garner enough support from Democratic lawmakers to pass both chambers of Congress.
Dick Durbin, the Senate Democratic whip, said he was not confident that all 50 Senate Democrats were āon boardā with the presidentās revised framework.
āI wish I could say yes, but there is a great deal of uncertainty within the caucus as to what is contained in the deal,ā Durbin told reporters on Capitol Hill.
Within the House, which Democrats control by a slim margin, Speaker Nancy Pelosi indicated that she wanted to push ahead with a vote by the end of the day on the separate $1.2tn bipartisan infrastructure package. House progressives have said they would not vote for the infrastructure bill without a simultaneous vote on the bigger budget bill.
After Biden spoke to House Democrats on Thursday morning, several progressives suggested that they were still unprepared to move ahead with the infrastructure vote.
