Revamp the tax code and major federal health care and environmental programs.
Spend $ 3.5 trillion over 10 years, but maybe a lot less.
Make sure no more than three Democrats across Congress vote “no,” because Republicans will be unanimously opposed.
Try to finish in the next few weeks.
And oh yes: failure means President Joe Biden’s own party will have repudiated him on the cornerstone of his national platform.
This is what Congressional Democrats face as they attempt to craft a final version of a massive bill that strengthens the social safety net and bolsters efforts to bring climate change under control.
Here is a guide to some crucial differences that they need to resolve:
The White House and the Main Democrats have compromised a cost of $ 3.5 trillion over 10 years for the bill. This is a huge sum, although a fraction of the $ 61 trillion in federal spending already planned during this period.
The moderates led by the senses. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona have said that $ 3.5 trillion is too expensive and that all Senate Democrats 50-50 votes are required to be successful.
Biden, House Speaker Nancy Pelosi, D-Calif., And Senate Majority Leader Chuck Schumer, DN.Y., recently acknowledged what seems inevitable: The end cost may have to come down.
Manchin suggested limiting the total to $ 1 trillion to $ 1.5 trillion, which progressives dismiss as derisory. Led by Senate Budget Committee Chairman Bernie Sanders, I-Vt., They initially said at least $ 6 trillion was needed for serious efforts to help families and curb global warming.
Eventually, a compromise will be reached, with some expecting it to be between $ 2,000 billion and $ 2,500 billion. But since House committees just finished designing a $ 3.5 trillion version of the package, a lower price means some priorities should be lowered.
To foot a large part of the bill, the House Ways and Means Committee approved $ 2.1 trillion in tax increases, mostly on the rich and corporate. Some details and figures seem likely to change.
Biden, who has promised not to raise taxes for people earning less than $ 400,000, will likely get his proposal to raise the wealthiest personal income tax rate to 39.6%. That would be an increase from the 37% approved under former President Donald Trump.
But the Democrats also want to increase other taxes on the richest. It is not known which proposals will survive and in what form.
For example, Senate Finance Committee Chairman Ron Wyden, D-Ore., Has expressed interest in raising taxes on the value of certain large estates inherited by heirs. Ways and Means President Richard Neal, D-Mass., Omitted this from his panel’s plan.
Democrats want to offer tax credits for children, health care and child care expenses, and low-income workers. If the size of the bill shrinks, Democrats could save money by delaying, phasing in or phasing out or limiting some of these breaks. Some moderates say that a proposed tax credit for the purchase of electric vehicles should not go to those with the highest incomes.
Biden wants to raise the corporate tax rate from 21% to 28% but may have to settle for around 25%. Democrats face other differences when it comes to taxes on foreign corporate income and share buybacks.
Three moderate Democrats have blocked a House committee from approving a top priority for Biden and the Progressives: saving hundreds of billions by letting Medicare negotiate lower prices for the pharmaceuticals it buys. Another committee approved the language, so it’s not dead.
Yet the plan faces opposition from drugmakers and some moderates want to water it down.
Democrats planned to use the savings to pay for another progressive goal: new Medicare dental, vision and hearing coverage. If the language of drug pricing is diluted and produces less savings, it is unclear how the Medicare expansion would be funded.
SALT AND IRS
In a city that loves acronyms, SALT, short for state and local taxes, is on the table.
Democrats in heavily taxed coastal communities are demanding an increase to the current $ 10,000 limit on deductions taxpayers can claim for the local and state taxes they pay.
Since Pelosi cannot afford to lose more than three Democratic votes, many believe the deduction cap will be raised. To make up for lost income, the IRS might receive additional money or banks might be required to report more information about financial transactions to the IRS, ideas to strengthen tax collections.
The House has proposed subsidies for power companies that switch to renewable fuels and fines for those that do not, a pillar of the House’s climate change agenda.
Manchin, chairman of the Senate Energy Committee and a staunch supporter of his state’s coal industry, has told his colleagues he is against it.
The House has proposed a mandatory family leave plan that is significantly more expensive than what Senate Democrats are considering. And lawmakers are awaiting a ruling from the Senate parliamentarian on whether the language helping millions of immigrants stay in the United States violates fiscal rules and should be left out.
Last month, Pelosi told moderates that the House would consider their top priority, a separate road to funding $ 1 trillion in infrastructure and other infrastructure projects, by September 27.
In what appears to be a mutual political suicide pact, progressives have threatened to vote against this bill unless unenthusiastic moderates back the $ 3.5 trillion package. Ideally, Democratic leaders would like to see the two bills passed together.
With so many details pending, it seems highly unlikely that the $ 3.5 trillion measure will be completed by then. This has raised questions about how Pelosi will keep her party’s antagonistic wings to support the other’s priority bills and how she will guide the two towards the passage.
THE TWO SECRET WEAPONS OF THE DEMOCRATS
On the one hand, a failure of the effort would mean a blatant failure to embrace their highest priorities, weakening their attempt to retain their majorities in Congress in next year’s election. Every Democrat knows it.
Another is Pelosi herself, who has proven to be adept at keeping Democrats together and getting the votes she needs.
House Budget Committee Chairman John Yarmuth, D-Ky., Cited the two factors in an interview last week, describing what he told Democrats.
“I said everyone should come out and do their best to defend their priorities, but at the end of the day you’re going to vote for this thing,” Yarmuth said. “And by the way, have you met Nancy Pelosi?”