Patterico's Pontifications

9/28/2021

Down to the Wire (Supposedly) with Infrastructure and Reconciliation

Filed under: General — JVW @ 5:11 pm



[guest post by JVW]

As we’re now well into the dying days of September, these are the make-or-break moments for the Biden economic agenda, specifically his bipartisan infrastructure proposal and the go-it-alone-Democrat budget reconciliation bill. We’ve tracked the progress of both pieces of legislation here, here, here, and here, so at this point let me just provide some quick updates on where things stand:

* The so-called “moderate” Democrats in the House, i.e. those who are a bit leery about spending $3.5 trillion on a dopey left-wing list to Santa Claus, had negotiated in advance with party leadership that a vote on the infrastructure bill (which somehow garners a modicum of bipartisan support) would take place before a vote on the reconciliation bill. This gives them the opportunity to bloviate about how awesome bipartisanship can truly be when both sides come together, and blah, blah, blah, before being forced to fall on their swords and vote yes for the huge reconciliation bill (or not). They had arranged for a vote on the infrastructure bill to take place yesterday, September 27.

* That vote did not happen. House leftists and their Senate allies are demanding that the House moderates commit to voting for the reconciliation bill before the reconciliation bill passes. Obviously, Congressional leftists believe that they will be abandoned by the moderates once they get their bipartisan infrastructure bill.

* Rumor has it that Sen. Krysten Sinema had told her Senate colleagues that she won’t agree to any corporate or individual tax increases as a means of funding the reconciliation bill. This has Arizona activists absolutely apoplectic.

* President Biden hosted the moderate Democrats in his office last week to try to work some of that alleged Irish charm he possesses to win them over. Reports are that his attempts floundered when the group politely refused the President’s pleas to name a number to which they would commit.

* One problem the Dems are dealing with on the reconciliation bill is that it has not yet been scored by the Congressional Budget Office. The bill’s proponents peg the costs at $3.5 trillion, which the media has dutifully repeated, but there are indications that it could be substantially higher. The Committee for a Responsible Federal Budget, a nonpartisan group who in the past has criticized Administrations and Congresses from both parties for spending well beyond revenue, believes the reconciliation bill as currently construed could cost as much as $5.5 trillion, and they point out that the spending initiatives in these bills such as free community college, expanded day care, and the rest are highly likely to become permanent after the funding ostensibly expires in ten years.

* Everyone’s favorite cranky old Marxist Great-Uncle wants the whippersnappers in the House to block the infrastructure bill until moderate Democrats cave on the full amount that the left demands in the reconciliation bill. This seems to me to almost ensure that both bills fail: If you are Krysten Sinema or Joe Manchin don’t you think you would welcome a fight with Bernie Sanders over taxes and spending?

* All of this takes place as a potential government shutdown looms at the end of this month unless Congress agrees to increase the debt ceiling. Though the increase in the debt ceiling is certain to come, GOP Senators are forcing the Democrats to provide all of the votes to increase the ceiling. It’s a cynical move undertaken by Senate Minority Leader Mitch McConnell — force the Dems to wait until the last possible moment to raise the debt ceiling and then dare them to try and pass a massive tax-and-spend bill — but given the myriad of lies with which the Democrats have handled the reconciliation bill up to this point, it somehow seems appropriate.

Next stop is the Thursday vote. Will Nancy Pelosi and Chuck Schumer have somehow worked out a compromise between the warring factions in their party? Will the infrastructure bill be approved by the House that day and sent on the President for his signature? Or will the whole edifice crumble as the Democrats’ impossible promises — all sorts of new goodies fully paid for but not by tax increases on any family making less than $400,000 per year — collapse underneath their own weight? Could the bill be rescued by moving towards funding it entirely with a carbon tax rather than income taxes? (Spoiler alert: No, and Hell no.)

Lots of luck (no, not really) to the blue team for squaring this tough circle. Keep in mind, no matter what you read this week, that this is a mess entirely of the Democrats’ own making.

– JVW

10 Responses to “Down to the Wire (Supposedly) with Infrastructure and Reconciliation”

  1. The parenthetical “supposedly” in the post’s title comes from my intuition that Congress won’t come to an agreement but will somehow find a way to push the vote on the infrastructure bill a couple of weeks into October while they try to hammer out a compromise on reconciliation, to which the “moderate” Democrats will quietly acquiesce. I wouldn’t think delays work to the Democrats’ advantage at this point, except maybe to the degree that we may get farther removed from the Afghanistan debacle and the crisis on the border by the time the Democrats vote to put us into hock for the rest of eternity.

    JVW (ee64e4)

  2. “The White House – The President’s Build Back Better Agenda will save 9 million Americans an average of $50 per person, per month, by lowering health insurance premiums. That’s a big deal.”

    Best comment:

    “Still waiting on the $2500 a year healthcare savings you promised us a decade ago.”

    Obudman (18ecb6)

  3. The House Freedom Caucus played this game with Speaker Ryan, ending with neither of them getting anything at all.

    Kevin M (ab1c11)

  4. they point out that the spending initiatives in these bills such as free community college, expanded day care, and the rest are highly likely to become permanent after the funding ostensibly expires in ten years.

    This is the real killer. Even if you think that some kind of stimulus is needed, this isn’t that. This is a large increase in the ongoing size (and influence) of government.

    Kevin M (ab1c11)

  5. The infrastructure bill will pass. The rest of it will fail.

    Kevin M (ab1c11)

  6. The funniest (and saddest) part about the carbon tax article from the NYT that I linked to (by way of Yahoo News) is that the authors write 1600 words about the possibility of the Dems imposing some sort of carbon tax without bothering to mention that there is very little chance that Joe Manchin of coal-producing West Virginia would ever go for it. I guess they had a lot of column inches to fill with progressive fairy dust that day.

    JVW (ee64e4)

  7. Note that the Dems allies in the media have whipped out the “if we don’t raise the debt ceiling we’ll default!” canard they employed during the Obama years, knowing that most Americans don’t understand that the default happens if we don’t make the required debt service payment, not raise the ceiling itself. After nearly 13 years of ZIRP loans, there’s little, if any, reason to worry that a default will take place.

    Of course, the Fed is basically stuck now and a Volker-like increase to tamp down inflation (that the administration either claims isn’t happening or, if they are admitting it, that it’s just “temporary”) is now out of the question, because raising those rates *will* utterly obliterate the federal budget. Heck, even going back to 2007 rates would likely nuke the budget. These media figures also know this, which is why they’re trying to ratchet up the scare-mongering on a default in the hopes that the Republicans will fold.

    Factory Working Orphan (2775f0)

  8. I hope both of these bills fail.

    Time123 (213142)

  9. As FWO alluded, the problem isn’t the debt ceiling. The problem is interest rates. Our artificially low interest rates have allowed the government to borrow pretty much free. But when the interest rates rise, all of a sudden that free borrowing is no longer free. That is when the government and its people will feel the pain.

    Hoi Polloi (121542)

  10. Why would the government run out of money if the debt ceiling isn’t raised? Money created out of thin air hasn’t bothered anyone before.

    The libertarian, but not Libertarian, Dana (fcc309)


Powered by WordPress.

Page loaded in: 0.1739 secs.