After loss in Virginia, Democrats look to speed up their stalled $3 trillion spending agenda

Source: By Tony Romm, Mike DeBonis and Marianna Sotomayor, Washington Post • Posted: Wednesday, November 3, 2021

‘The American public gave us a majority of both houses for a reason,’ Sen. Tim Kaine says

House Speaker Nancy Pelosi (D-Calif.), seen at the Capitol on Nov. 3, said lawmakers had revived an effort to provide paid family and medical leave as part of the spending bill. (Jim Lo Scalzo/EPA-EFE/Shutterstock)

A new sense of political urgency swept over restive Democrats from the White House to Capitol Hill on Wednesday, as they raced to resolve the final issues stalling President Biden’s roughly $3 trillion economic agenda in the aftermath of a stinging election defeat in Virginia.

With a loss in the state’s gubernatorial race — along with a tight contest still undecided in New Jersey — party leaders found themselves pining anew for lawmakers to set aside their differences and advance two spending initiatives that have been bogged down for months in Congress.

“I think it’s going to send a signal that we’ve got to produce. You know, the American public gave us a majority of both houses for a reason,” said Sen. Tim Kaine (D-Va.).

The work continued primarily in the House, where Democrats raced to fine-tune a $1.75 trillion proposal to overhaul the nation’s health care, education, climate and tax laws. Party leaders finalized a new version of the legislation on Wednesday, with the goal of holding a key procedural hearing imminently and voting on it before the end of the week.

Even as they readied the new 2,135-page proposal, however, Democrats found themselves grappling with a slew of lingering policy fights — a reflection of the persistent tensions between the party’s liberal and moderate wings.

Democrats continued to spar over a plan to address immigration, for example, disappointing some left-leaning lawmakers who want to see the party take aggressive action to overhaul the system. And they appeared especially at odds over an eleventh-hour effort to restore a plan to provide paid family and medical leave benefits for millions of Americans. A key centrist swing vote, Sen. Joe Manchin III (D-W.Va.), has opposed the idea — a stance he reiterated Wednesday as he argued instead it should be tackled separately in a “bipartisan way.”

In doing so, Manchin interpreted Democrats’ defeat in Virginia differently than many of his own colleagues. He said the loss reaffirmed his long-known fiscal fears about his own party’s vast ambitions to spend trillions of dollars to advance its agenda.

“They were concerned about inflation, high costs, making it more difficult for them,” the senator said. “And I think they spoke loud and clear at the voting [booth], so I hope everybody listens.”

A successful House vote on the fuller $1.75 trillion measure still would open the door for Democrats to advance a second, parallel measure to improve the country’s roads, bridges, pipes, ports and Internet connections. That $1.2 trillion infrastructure bill has been stuck in the chamber since it cleared the Senate on a bipartisan basis in August, a political casualty in the broader war among the politically fractious Democratic caucus.

Speaking to reporters as he entered a private meeting of party lawmakers, Rep. Josh Gottheimer (D-N.J.) said he would not play the “blame game” as to whether the holdups had hurt the party in his home state, where incumbent Gov. Phil Murphy clung to a narrow lead. But Gottheimer did maintain that it was time for Congress to move forward, telling reporters: “I think the American people want us to act and get things done.”

Democrats have sketched out similarly ambitious timetables in the past, only to be stymied by their own internal disputes, delaying votes that could have sent at least some of the spending legislation to the president sooner. Biden has even intervened personally, hoping to salvage a sprawling policy agenda that corresponds with promises that he and other party candidates made during the 2020 presidential race.

But there may have been no greater catalyst for swift action on Biden’s fuller agenda than the voting that concluded in Virginia, New Jersey and other states on Tuesday. Some Democrats saw those election results as a warning sign a year before Americans are set to return to the polls in 2022, when their narrow yet potent majorities in the House and Senate are on the line.

“We needed to show here in Washington that we could govern,” said Sen. Mark R. Warner (D.-Va.), pointing out that Democrats should have acted sooner on infrastructure even as lawmakers negotiated the rest of Biden’s agenda.

The new political uncertainty underscored the high stakes for Democrats in the year after they swept into power in Washington on a plan to “build back better” — the president’s oft-repeated slogan that later became the name of one of his signature initiatives. Biden and his allies on Capitol Hill have framed their long-sought spending in historic terms, promising it would transform wide swaths of the economy amid the coronavirus pandemic.

But the Republican victory in Virginia — with GOP candidate Glenn Youngkin beating back Democratic candidate Terry McAuliffe in a state Biden handily won in 2020 — still opened the door for fresh political attacks on Wednesday. Sen. Rick Scott of Florida, the leader of the GOP’s campaign arm for the Senate, said the result evinces that the “public is rejecting this big government socialism.”

“Inflation is the biggest issue for people right now, and it’s caused by big government,” said Scott, leveling an oft-repeated attack by Republicans that Democrats vehemently dispute.

White House officials did not appear poised to slow down their push despite McAuliffe’s loss in Virginia. Transportation Secretary Pete Buttigieg tweeted that “two historic packages of big, important, needed, positive, timely – and very, very, very very popular – policies are ready for action in Congress. The time to deliver is here.”

Democrats still have a number of critical issues still to resolve, including lingering concerns aired by Manchin as to whether the party is moving too quickly to adopt a measure that could add to the deficit and cause even more prices to rise.

Publicly, though, Senate Majority Leader Charles E. Schumer (D-N.Y.) on Wednesday touted “great progress,” pointing as an example to the agreement brokered Tuesday among fractious Democrats over a plan that aims to lower prescription drug costs for millions of seniors. The new policy opens the door for party lawmakers to deliver on one of their signature campaign promises, though the pricing proposal is still significantly scaled back from its original form.

“We are close, we are determined, [and] we are confident we will succeed in rewarding the trust the American people have placed in us,” Schumer told lawmakers.

Other unresolved policy battles include an attempt to tackle immigration as part of the $1.75 trillion package, according to two people familiar with the matter who requested anonymity to describe the private deliberations. On climate, meanwhile, lawmakers continued to haggle with Manchin over a proposal to provide tax credits to families that seek to purchase electric vehicles.

Under the existing proposal, Americans could claim the credit provided they make under $400,000 individually, or $800,000 as a couple, the two sources said. Manchin believes those thresholds are too high, and at one point in the negotiations, put forward a cap at $75,000 individually or $150,000 if married.

Democrats are set to unveil a bill later as soon as Wednesday that is lower than the initial threshold yet higher than what Manchin previously sought, according to the aides, one of whom said the senator has been open in talks to different amounts. A lower cap would target the aid more narrowly at Americans in need, but potentially cut into Democrats’ clean-energy plans, as it would overall perhaps mean fewer purchases of electric cars.

House Speaker Nancy Pelosi (D-Calif.) on Wednesday also said lawmakers had revived an effort to provide paid family and medical leave as part of the bill. The still-forming plan would provide four weeks of benefits starting in 2024, according to another Democratic aide, who spoke on the condition of anonymity to describe a policy that has not been finalized. It appears to include family, medical and sick leave at a cost of about $200 billion, the aide added.

The idea previously had been jettisoned from the $1.75 trillion blueprint that Biden presented to Democrats last week, a reflection of months of unsuccessful talks with Manchin, who questioned the solvency and necessity of such a social benefit program. In bringing it back, though, Pelosi appeared to be daring the moderate senator to strip out a proposal Democrats believe is one of the most popular in the total package.

“While it was a reduction in dollars from the original $3.5 trillion package, it was not a reduction in values,” Pelosi said of Democrats’ efforts to scale down their original spending plans to resolve issues raised by Manchin.

Without a resolution on that spending plan, Democrats remain unable to deliver a final successful vote on a second, roughly $1.2 trillion measure to improve the nation’s infrastructure. Liberals in the House have held up that package as leverage while negotiations continue with Manchin and other moderates over the rest of Biden’s economic agenda.

Manchin this week urged liberals to loosen their blockade, given the bipartisan support for the public works spending deal, which he helped negotiate. Other centrists, including Warner, in recent days had stressed that swifter House passage might have provided a boost for Democrats in his home state — potentially giving McAuliffe the edge he would have needed to prevail.

Dino Grandoni contributed to this report.