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5 things in Biden's $2 trillion spending plan that could get stripped out by the Senate, ranging from tax cuts to paid leave

Markets Insider
Markets Insider
 2021-11-22

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Sen. Joe Manchin of West Virginia.
  • Biden's $2 trillion social spending bill faces a possible overhaul in the Senate.
  • Manchin has expressed opposition to provisions including four weeks of paid leave.
  • Other Democrats want to scale back a program providing tax breaks to wealthy Americans in high-tax states.

House Democrats passed a $2 trillion social spending plan on Friday morning, advancing a key part of President Joe Biden's agenda.

But it sets up a showdown in the 50-50 Senate, where the centrist Democratic Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona are influential swing votes who haven't yet given a thumbs up to the House bill.

Senate Democrats want to pass it by Christmas. Here are five provisions that could fall out of the House bill in the next few weeks.

Four weeks of paid parental and medical leave

A key part of the House bill would set up four weeks of paid leave for new parents to take care of a newborn child, along with sick leave starting in 2024. The US is currently an outlier as the only wealthy nation without any national paid leave program for its citizens.

But the program faces strong resistance from Manchin. He's argued that it could grow the national debt and a deal could be struck with Republicans on an alternate version instead. The West Virginia Democrat told Insider last month that he backs a payroll tax on workers and employers instead of making it federally funded.

Lifting state and local tax deductions to $80,000

A group of House Democrats want to raise the total amount of state and local taxes that people can shave off their federal taxes to $80,000 from $10,000. The program would run through 2030 and expire soon afterward.

Some Senate Democrats including Michael Bennet of Colorado, Jon Tester of Montana, and Bernie Sanders of Vermont are balking since it largely benefits wealthier Americans in high-tax states like New York and California, handing them a hefty tax break instead of a tax hike. Sanders is negotiating an alternate plan with an eye towards establishing income thresholds.

Manchin hasn't publicly commented on the SALT deduction. But a past vote may offer a clue to his approach: He was the lone Democrat who backed a GOP proposal to establish the cap in late 2017. He also cast a follow-up vote on a rival Democratic amendment to preserve it and avoid hiking taxes on middle-class families, suggesting he could fall somewhere in the middle between both approaches.

Cap on insulin prices

Another provision at risk of falling out of the Democratic plan is a $35 monthly cap on insulin costs, designed to help  cut rising cost of healthcare and fulfill a Democratic campaign promise.

"We are halting Big Pharma's outrageous price hikes and, in addition to that, we are dramatically lowering healthcare costs," House Speaker Nancy Pelosi said in a floor speech on Friday.

But Senate Majority Leader Chuck Schumer suggested Sunday that the Senate parliamentarian could advise Democrats to drop it from the bill if it doesn't comply with strict budgetary rules.

Medicare expansion

Sanders is the leading Democrat spearheading a push for an expansion of Medicare so it would provide dental, vision, and hearing benefits. Schumer backs it as well.

"The American people overwhelmingly demand that we expand Medicare to cover dental, eyeglasses and hearing aids," Sanders said in a statement on Friday.

But it faces a roadblock from Manchin, who argues that enlarging Medicare could further burden its finances and render it insolvent within years. "If we're not being fiscally responsible, that's a concern," he told reporters last month.

Immigration

There is a measure within the House bill to provide up to 6.5 million unauthorized immigrants with provisional work permits.

Yet the parliamentarian may strike it down and say it doesn't abide with the rules governing reconciliation, the party-line process that Democrats are employing for this legislation. The official has already shot down two past Senate Democratic measures aimed at establishing a path to citizenship.

Read the original article on Business Insider

Comments / 7

nanadeb
11-23

wow...if we break the law we go to jail, but if you come here illegally you get free stuff and work permits so they can work and send their money to their homeland to build big houses. We can't even take care of our own homeless vets. We can't save the world.

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Donna Kelly
11-23

Biden bill shows the lies cutting taxes for the wealthy gee ! when will people realize what a sham this dictator is

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Fred Palazzo
11-25

This is so simple Pelosi. Get it done with immigrants and immigration. Trade the daca and immersion of all illegal immigrants since 2015 for walls on both borders. The pandemic shows we sure need them for the next pandemic, if not this one still, so the wals will not be a negative. It will pay for itself with the elimination of our border patrol as it currently stands. Let the Republicans round up everyone who came in illegally after 2015 as soon as both borders are complete. And the immersion will close most of our borders from bringing legal immigrants' families into our country for 10 years after the walls are done, unless they want to trade souls amongst themselves. That'll give us some soaps to keep our minds busy. Do it before next year's elections

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