Half his original size, close-up of Biden racing to finish | Government and Politics

By LISA MASCARO, AAMER MADHANI and ALAN FRAM Associated Press

WASHINGTON (AP) – Half its original size, President Joe Biden’s grand home policy plan is being dismantled and reconfigured as Democrats move closer to satisfying their most reluctant colleagues and finalizing what is now about $ 1.75 trillion.

How to pay for it all remained deeply in motion on Tuesday, with a billionaire tax proposal facing equally heavy criticism or worse. This forces difficult cuts, if not outright elimination, of policy priorities – from paid family leave and child care to dental, vision and hearing benefits for the elderly.

Once cumbersome climate change strategies are also losing their effectiveness, shifting away from punitive measures against polluters to more incentives to reward clean energy.

The pressure is mounting, Biden met two recalcitrant Democrats Tuesday night – the senses. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, according to a person who requested anonymity to discuss the private meeting. The president is pushing for a deal before he leaves for world summits later this week.

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All in all, Biden’s package remains a significant undertaking – and could still exceed $ 2 trillion in perhaps Congress’ largest such effort in decades. But it’s much thinner than the president and his party initially envisioned.

House Speaker Nancy Pelosi told lawmakers they were on the verge of “something major, transformative, historic and greater than anything else” ever attempted in Congress, according to another person who requested anonymity to share their private remarks with the caucus.

“We know we are close,” said Representative Joyce Beatty, D-Ohio, chair of the Congressional Black Caucus, after a meeting with Biden at the White House. “And let me be explicitly clear: our footprints and our fingerprints are on it.”

However, big differences between Democrats remain over the basic outlines of the radical proposal and the tax revenues to be paid for it.

From the White House, press secretary Jen Psaki said Biden still hopes to have a deal in hand to show foreign leaders that the US government is acting effectively on climate change and other major issues. But she admitted that might not happen, forcing her to continue working on the package remotely.

She warned against failure as opposed to compromise

“The alternative to what is being negotiated is not the original package,” she said. “It’s nothing.”

More lawmakers came to the White House for negotiations on Tuesday and emerged optimistic the end product would be substantial, despite the changes and cuts imposed on them by Manchin and Sinema.

Together, the two senators did a double blow – Manchin forcing his supporters to cut spending on health, child care and other spending and Sinema forcing Democrats to reconsider their plans to undo the tax cuts in the country. Trump era on corporations and the rich.

Resolving the income side is key as Biden insists that all new spending will be fully paid and not accumulated on the national debt. He promises that any new taxes will only hit the rich, those who earn more than $ 400,000 a year, or $ 450,000 for couples, and businesses, he says, must stop skipping taxes and start paying their ” fair share “.

But the White House had to rethink its tax strategy after Sinema opposed his party’s initial proposal to raise tax rates for corporations and the wealthy. With a Senate at 50-50, Biden has no voice to spare in his party.

Instead, to win over Sinema and others, Democrats were set to unveil a new plan to tax billionaire assets. And on Tuesday, they unveiled a proposal to force companies with more than $ 1 billion in revenue to pay a minimum tax of 15%, winning support from Sinema.

“Here’s the heart of the matter: Americans have read in recent months that billionaires pay little or no tax for years,” said Senator Ron Wyden of Oregon, chairman of the Senate Finance Committee , at the head of the effort.

Under Wyden’s emerging plan, the billionaire tax would hit the richest American, less than 1,000 people. This would force those with assets of over $ 1 billion, or consecutive income of $ 100 million over three years, to pay taxes on earnings from stocks and other marketable assets, rather than wait for the sale. assets.

A similar billionaire tax would be applied to non-marketable assets, including real estate, but it would be deferred with unassessed tax until the asset has been sold.

Overall, the tax rate for billionaires had not been set, but it had to be at least equal to the 20% rate of capital gains. Democrats have said it could generate $ 200 billion in revenue that could help fund Biden’s 10-year program.

Republicans scoff at the billionaire tax and some have suggested it faces a court challenge.

And senior Democratic colleagues have also raised concerns about the billionaire tax, saying the idea of ​​simply undoing the 2017 tax cuts by raising the highest rates was more straightforward and transparent.

Representative Richard Neal, D-Mass., Chairman of the Ways and Means Committee, said, “Our plan is improving every day.”

Under the bill approved by Neal’s panel, the top tax rate would drop from 37% to 39.6% for those earning over $ 400,000, or $ 450,000 for couples. The corporate rate would drop from 21% to 26.5%. The bill also proposes a 3% surtax on the richest Americans with adjusted income in excess of $ 5 million per year.

Less concerned about the new taxes, Manchin is forcing his party to reconsider expanding health, childcare and climate change programs that he sees as expensive or unnecessary government fees.

Under discussion: plans to extend Medicare coverage with dental, vision and hearing benefits for the elderly; childcare assistance; free preschool; a new four-week paid family leave program and a more limited-than-expected plan to reduce prescription drug costs.

On climate change, Senator Manchin, State of Coal, rejected Biden’s previous clean energy strategy, deeming it too punitive for suppliers who rely on fossil fuels. Instead, the White House launched an idea to boost grants and loans to encourage clean energy sources.

Manchin’s resistance could derail another tax idea – a plan to give the IRS more resources to tackle tax evaders. He said he told Biden at their weekend meeting at the president’s home in Delaware that the plan was “angry” and would allow the government to monitor bank accounts.

Democrats hope to reach a deal by the end of the week, paving the way for a House vote on a bipartisan $ 1,000 billion infrastructure bill before routine transportation funds expire Sunday. This separate roads and bridges bill was stalled when progressive lawmakers refused to support it until deliberations on the broader Biden bill were completed.

Associated Press editors Farnoush Amiri, Darlene Superville, and Colleen Long contributed to this report.

This story has been corrected to show Rep. Richard Neal is from Massachusetts, not New Jersey.

Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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