WASHINGTON — Sen. Joe Manchin has said he’ll oppose an economic measure he’s been negotiating with Democratic leaders if it includes climate or energy provisions or higher taxes on the rich and corporations, a Democrat briefed on the conversations said late Thursday, delivering a stunning blow to one of the party’s top election-year priorities.
According to the official, Manchin had told Chuck Schumer (D-N.Y.), on Thursday, that he would only support any new legislation if it was limited to reducing pharmaceutical prices and expanding federal subsidies for purchasing health care coverage. Manchin abruptly derailed his party’s bigger and wider-ranging social and environment package last December after months of negotiations and after the measure had already passed the House.
Manchin’s demands leave the future of the latest measure unclear, seemingly upending the hopes of President Joe Biden and Democratic leaders’ for a more sweeping package they could push through Congress by August. They would have been able to demonstrate that their party prioritizes include taxing the poor and curbing climate change. This would also allow them contrast themselves with Republicans expected to vote against the legislation.
However, containing the costs of prescription drugs and extending subsidies for people buying health insurance under former President Barack Obama’s 2010 health care law are also top Democratic priorities. Manchin’s stance puts his party in the position of having to decide whether it should reluctantly declare victory by solely addressing some of its health care goals, as opposed to demanding more but potentially ending up with nothing.
The nonpartisan Congressional Budget Office has estimated that provisions Democrats have already agreed to curbing prescription drug costs — like letting Medicare negotiate prices for pharmaceuticals it buys — would save $288 billion over the coming decade.
This would cover the cost of extending subsidies to government for private health care coverage. The assistance expires January.
Manchin spokesperson Sam Runyon issued a statement that reiterated the senator’s assertions that he did not want any measure that emerged to worsen inflation. This week, the government released a report that showed consumer prices increased by 9.1% last month. It is the highest annual rate in over 40 years.
“Political headlines are of no value to the millions of Americans struggling to afford groceries and gas as inflation soars to 9.1%,” Runyon said. “Senator Manchin believes it’s time for leaders to put political agendas aside, reevaluate and adjust to the economic realities the country faces to avoid taking steps that add fuel to the inflation fire.”
Manchin signaled unease with the negotiations on Wednesday, saying the latest inflation figures left him feeling “more cautious than I’ve ever been” about agreeing to a package that could fuel further price increases.
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Official who spoke out about the talks wasn’t authorized to speak publicly, and spoke only under condition of anonymity.
Biden and congressional Democrats hope to pass a $1 trillion version, roughly equivalent to the $2 trillion Manchin passed in December. They also want it to be hailed as a major achievement prior the November election. Republicans who are hoping to capture the Senate and House control during the fall election say that the new measure would increase inflation by raising taxes and spending more.
Manchin, one of Congress’ more centrist Democrats, has enormous leverage, much to the dismay of many in his party. Using special budget rules, Democrats can push a package through the 50-50 Senate if they are solidly united, along with Vice President Kamala Harris’ tie-breaking vote.
Although they control the House in a narrow manner, they also hold it. Recent grumbling from some moderates there about raising taxes — an easy campaign-season target for Republicans — has raised questions about the fate of tax boost proposals in that chamber.
Many top Democrats want to agree and approve the measure prior to Congress’ August recess. In the autumn election year, where every vote is the object of campaign attacks ads, progress on major legislation can be much more challenging.
White House spokesman Nick Conger declined to comment on Manchin’s position.
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Senate Finance Committee Chairman Ron Wyden, D-Ore., called Democrats’ legislation “our last chance to prevent the most catastrophic-and costly-effects of climate change.” But he said the party must “salvage as much of this package as possible. The expression that failure is not an option is overused, but failure really is not an option here.”
“It seems odd that Sen. Manchin would choose as his legacy to be the one man who single-handedly doomed humanity. But we can’t throw in the towel on the planet,” said John Podesta, founder of the liberal Center for American Progress, who said Biden should use his executive powers to take climate action.
Brett Hartl, government affairs director at the Center for Biological Diversity, called it “outrageous that Manchin and the Republican Party have killed climate legislation this Congress,” and called on Biden to take action.
In lengthy talks that lasted several months, Manchin expressed his support for climate and energy language as well raising levies to high-earners.
Two Democratic aides claimed this week that bargainers planned to include a proposal for Medicare’s solvency extension. This would involve applying a 3.8% tax to high-earners to many individuals who are income from tax-advantaged businesses. Runyon replied that Manchin supports keeping Medicare solvent, and decreasing pharmaceutical costs.
The official said that Schumer told Manchin in their discussions, that he was open to using half the total measure for deficit reduction. This Manchin demand is confirmed by the official.
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According to the official, Schumer said that he supports the allocation of $375 million for climate and energy provision. He also told Manchin he would back provisions aimed at helping domestic energy drilling — the West Virginian is a strong supporter of coal and domestic oil production — and would not include tax credits for electric vehicles, which Manchin had largely opposed.
According to Democratic estimates, even though the official stated that, however, the resultant measure would include clean energy tax credits, and reduce carbon emissions by nearly 40 percent per year by 2030.
AP reporter Matthew DalyContributed to the report.
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