The Washington Post is reporting today that centrist Democrats are taking a wait-and-see approach to President Trump’s $3.5 trillion budget proposal, which includes a $1.6 trillion increase in defense spending and a $2 trillion budget for infrastructure projects. Democrats are concerned that the budget would increase the national deficit, which would be followed by an increase in the national debt, which would need an increase in interest rates or a decrease in the value of the dollar.
Democrats are taking a wait-and-see approach to President Donald Trump’s proposed $3.5 trillion spending plan for the 2019 fiscal year, saying that only Congress will be able to decide whether it is good or bad for the country. Aides didn’t say whether they would support the budget or oppose it, but they said that they would give it serious consideration. Democrats are likely to have to make hard choices about whether to support the president’s budget, which will determine how much money Congress will have to work with next year.WASHINGTON – Democrats took a neutral position Wednesday on the new $3.5 trillion budget, saying they should look at the details of a comprehensive plan to fund access to affordable preschool and child care, expanded Medicare benefits and programs to combat poverty and climate change.
Senate Majority Leader Chuck Schumer (D., N.Y.) and Democratic members of the Budget Committee announced a deal Tuesday night to use $3.5 trillion to draft a budget resolution that would set the parameters for legislation that comprises much of President Biden’s legislative agenda. Democrats hope to use the budget process known as reconciliation to get the package through without GOP support, but they must maintain complete unity within their ranks to get it through a divided and split Senate.
We’ll get there, Biden said Wednesday on Capitol Hill, shaking his fist during an afternoon meeting with Senate Democrats in which he supported the $3.5 trillion plan and stressed the importance of unity, lawmakers said.
The $3.5 trillion agreement is more than some centrist Democrats had expected, but it represents a delay for Senate Budget Committee Chairman Bernie Sanders (I., Vt.), who initially wanted a $6 trillion package. Many moderate Democrats in the Senate, including Sens. Jon Tester of Montana, Jeanne Shaheen of New Hampshire and Kirsten Sinema of Arizona, said they were still working out the details of the deal. Senator Joe Manchin (D., W.Va.) said he had raised concerns over lunch about the package’s impact on inflation and climate change provisions.
The bill is expected to include significant tax breaks for clean energy investments, and liberal Democrats are pushing to end fossil fuel subsidies.
Senator Joe Manchin expressed concern about the impact of the package on inflation and climate change provisions.
Jim Lo Scalzo/Shutterstock
I’m also concerned about maintaining U.S. energy independence, and to do that, you can’t get off fossil fuels, Manchin said. I hope we can come to an agreement so they understand that fossils will play a role.
Manchin’s other major concern is covering the bill’s $3.5 trillion total cost. Democrats on the Budget Committee said Tuesday night that the package would be fully funded by tax increases and other revenue sources.
You see, I’m open to it, Mr. Tester on Wednesday, noted that he thinks the federal government should invest in housing, child care and workforce training. I just need to know what’s in it and how it pays off.
Among other things, the White House has proposed raising the corporate tax rate to 21%, increasing the tax on foreign profits of U.S. companies, and raising the capital gains tax rate for high-income households. The plan would also rely on revenue from stricter enforcement by the Internal Revenue Service, an idea lawmakers are also considering in a separate bipartisan infrastructure project.
A Sinema spokesman said she would carefully consider any idea that would strengthen Arizona’s economy and help Arizona families move forward.
The Liberal Democrats also stated that while they were encouraged by the agreement, they also wanted to question its details.
It’s a great boost, said
Member of Parliament Pramila Jayapal
(D., Wash.), chairman of the Congressional Progressive Caucus. However, she cautioned that support for our Caucus is not guaranteed until we know how our priorities fit into the proposed structure.
Sen. Ron Wyden says lawmakers are working on a deal to lower the cost of prescription drugs.
Bill Clark/Zuma Press
A bipartisan group of lawmakers is separately working on a $1 trillion infrastructure package, about $600 billion of which would supplement planned federal infrastructure spending. Democrats said the two efforts together would persuade the Senate to approve most of Biden’s legislative proposals.
We understand the moment. We understand that it is rare for one party to hold the House of Representatives, the Senate, and the presidency at the same time, and that we have a special obligation to keep all of our promises.
Senator Brian Schatz
(D., Hawaii) said after lunch with Mr. Biden.
White House Press Secretary
said the agreement now represents and is aligned with the president’s priorities.
Lawmakers said the $3.5 trillion framework would not include major legislative priorities, but instead would reduce costs by shortening the duration of some benefits.
Republicans have criticized Democrats for preparing to dump trillions of dollars in additional federal funds into the economy, which they say could spur inflation.
These are huge expenditures and the largest tax increase in our nation’s history, Sen. Rob Portman (R., Ohio).
President Biden’s infrastructure plan includes unconventional projects, such as the expansion of some highways. What Democrats want for cities like Baltimore says a lot about the president’s goals for the next wave of development. Photo: Carlos Waters/WSJ
Legislation drafted by Democrats would include paid family leave and health care, subsidized child care, expanded child tax credits, universal preschool for three- and four-year-olds, and affordable housing. It will also extend the Affordable Care Act’s expanded subsidies that were approved earlier this year.
According to Democrats, the bill would significantly expand Medicare, both by extending benefits to dental care, vision and hearing aids, and by potentially lowering the enrollment age to 65. They also aim to lower the cost of prescription drugs by giving Medicare the right to negotiate prescription drug prices, which should raise hundreds of billions of dollars.
We are actively working on a prescription drug package that protects the millions of Americans who feel they are being robbed at pharmacies, said Senate Finance Committee Chairman Ron Wyden (D., Ore.). However, it is unclear whether Medicare will be able to get unanimous support from Democrats to negotiate drug prices.
I need to see what he says before I decide.
Senator Robert Menendez
Sanders said Wednesday that he also expects the package to include immigration provisions. Jayapal said she believes the bill would open the door to citizenship for various immigrant groups, including farmworkers, essential workers and Dreamers, a category of undocumented immigrants brought to the United States as children.
The extension of the child tax credit, part of the $1.9 trillion coronavirus plan approved by Democrats earlier this year, will likely be extended until 2024 as part of the reconciliation package, according to people familiar with the plan. In the Covid-19 bill, which was signed into law earlier this year, lawmakers increased the credit to $3,000 per child and $3,600 for children under age 6, allowing many American families to pay each month until the end of this year.
Summaries, analysis and opinions from the WSJ Washington bureau.
The White House had initially proposed extending the system until 2025, with some Democrats pushing to make it permanent.
On climate change, Democrats are proposing a number of ideas, including tax credits for clean energy investments and a clean electricity standard to reduce carbon emissions by 80 percent in the power sector by 2030 and 50 percent across the economy, a senior Democratic adviser said.
Other areas of the bill may include housing investment, manufacturing funding, and incentives and penalties to protect workers.
Liberal Democrats in the House and Senate have said they would support a bipartisan infrastructure bill only if there was enough support to pass an education and anti-poverty package. The Democrats can only move the budget package forward if all 50 members of their caucus support it, since no Republican will vote for it.
I’d like to get an even bigger number? Yes, I would, but there are 50 members in the Democratic Caucus, Sanders said Wednesday.
Democrats in both houses must make many controversial decisions, including how they plan to raise taxes on wealthy Americans and corporations. Advisors said a tax increase would not affect families with incomes under $400,000 or small businesses.
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-Richard Rubin, Lindsey Wise and Eliza Collins contributed to this article.
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