Don’t look now, but is the story becoming ... Dems in array?

Don’t look now, but is the story becoming ... Dems in array?

By Paul Waldman

 and 

Greg Sargent

 

Today at 5:02 p.m. EDT

For many months, the story of President Biden’s Build Back Better package has been one of intense ideological conflict within a deeply split Democratic Party. Progressives wanted to do more, centrists wanted to do less, they’ve torn each other to shreds, and we’ve had months of “Dems in disarray” headlines.

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But all of a sudden, one potential dealbreaking conflict after another has crept closer to resolution. These conflicts have long sat right on top of the ideological fault lines that divided the factions, yet little by little, those divides are getting closed.

This is the case in three areas: the deficit; the provisions curbing prescription drugs; and state and local tax deductions, or SALT.

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First, the centrists long insisted they wouldn’t vote for a package that would raise the deficit. But now a new analysis from the Joint Committee on Taxation shows its tax provisions will raise over $1.4 trillion over 10 years.

Combine that with provisions not included in the JCT analysis — funding the IRS to target wealthy tax avoiders and negotiating the price of some prescription drugs — and the Treasury Department estimates that the bill will raise over $2 trillion. Given the $1.7 trillion price tag, that means the bill would decrease the deficit.

Some centrists still want a Congressional Budget Office score as well. But this will make it easier for the centrists to get to yes.

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The progressives are getting much of what they want here, too: The plan includes a surtax on income over $10 million; pathbreaking efforts to crack down on tax avoidance by the rich and multinational corporations that shift profits offshore; a corporate minimum tax that will prevent highly profitable corporations from paying little to nothing; and more.

Now take prescription drugs. This was a major ideological fault line that had progressives furious with centrists (who resisted doing something) for supposedly being in the pocket of Big Pharma. But then came the agreement that Democrats announced a few days ago.

It got the support of Sen. Kyrsten Sinema (D-Ariz.) and key House centrists. And even if it doesn’t go as far as hoped, it represents a significant advance: It caps out-of-pocket spending for seniors, limits price increases for drugs and allows Medicare to negotiate prices for some medications.

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What about SALT? This also sat on a major fault line: Centrists who represent affluent, suburban districts stocked with professional/managerial-class voters wanted to restore the full deduction (which benefits mostly wealthy people who itemize deductions). But progressives fumed that this showed the party falling captive to wealthy professionals and well-heeled Democratic donors.

Yet it now looks like they’re close to a deal. Democrats in the House and Senate have put out competing proposals that differ in form but do essentially the same thing: restoring the deduction for everyone except the very wealthy. It might also be paired with a restoration of the alternative minimum tax, which would limit how much the very rich can take in deductions.

Progressives will understandably dislike this, but they know it’s necessary to get those House centrists on board, and the deal may be configured in a way that doesn’t allow the very wealthy to clean up too ostentatiously.

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Why are the two sides closer to coming together than before?

For the centrists, it’s apparent that they don’t want to take the blame for sinking the whole bill, or to be on the hook for killing very popular provisions of it.

The centrists had hoped to construct a situation in which progressives would be seen as the intransigent ones — hence the cannon blast from Sen. Joe Manchin III (D-W.Va.) at progressives earlier this week. But the progressives successfully positioned themselves as the true defenders of Biden’s full agenda, maneuvering the centrists into a position where they’d be blamed for failure.

For the progressives, the current package has a lot of good in it. We’re talking about hundreds of billions of dollars in tax credits to encourage the transition to renewable energy sources; an expanded child tax credit that is dramatically slicing into child poverty; an expansion of health-care subsidies to millions; large investments in universal pre-K and child care; and more.

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Meanwhile, the centrists managed to hold the line down on spending, making it unavoidably clear that they wouldn’t budge much. That left progressives no choice but to accept far less than they originally wanted, which they are now poised to do.

In a sense, each side has managed to exercise leverage on the other. If this works out, that will in some ways have proved to be a constructive process.

Things could still fall apart. Centrists still want more time to evaluate the bill, and the two sides are still battling over whether to keep the paid-leave provision. And other good things will be lost, such as the sticks and carrots to prod power companies to transition away from fossil fuels, higher corporate and top income tax rates, Medicare expanded to vision and dental care, and more.

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But in some ways, the process is working. That has gotten lost, because we focus on the disagreements, the disputes, the angry words, while a slowly emerging agreement isn’t as compelling. And every time Manchin uncorks a broadside, it creates the impression that the whole project is imploding.

But it may be that whatever the differences they started with, Democrats share a belief that the worst possible outcome is for the bill to die. And that might prevail. Let’s hope so, anyway.