Joe Biden agenda in limbo as Democrats haggle over reforms

Joe Biden’s economic blueprint for the US remained in limbo only hours before he was due to leave to meet global leaders in Europe.

Democrat holdout Kyrsten Sinema on Capitol Hill in Washington on Wednesday after speaking to President Joe Biden the previous night. Picture: AFP

Joe Biden’s economic blueprint for the US remained in limbo only hours before he was due to leave to meet global leaders in Europe.

Negotiators hoped to pass the US President’s massive social spending plan overnight but details were still being hammered out as White House aides assessed the situation “hour by hour”, spokeswoman Jen Psaki said.

The President was desperate to take some big domestic wins with him on a trip to the G20 summit in Rome and the COP26 conference in Glasgow, but weeks of negotiations between the Democrat party’s left and centre had yet to produce even consensus on the price tag, let alone the provisions it should contain or how to pay for it.

House Speaker Nancy Pelosi has now given congress until at least the end of Thursday (Friday afternoon AEDT) to ready their final language on the historic bill targeting climate change, childcare, preschool education and healthcare.

The mammoth package is crucial to another big win Mr Biden had hoped to secure before jetting off to Rome – the infrastructure bill to transform America’s crumbling roads, bridges and broadband systems. The bills are linked because the Democratic left flank in the house is withholding its green light on the Senate-passed infrastructure legislation until progressives have seen a final text on Build Back Better, their top priority.

Democrats have yet to reach consensus on a slew of issues in the Build Back Better package, including taxes, paid family leave, prescription drug pricing and expanding healthcare coverage for elderly and low-income Americans.

“There’s just huge pieces of this that are not nailed down. So each time I hear ‘Well, it’s almost done,’ I don’t know what the hell people are talking about,” Democratic senator Jeff Merkley told NBC.

In a last-second scramble to pay for Mr Biden’s plans, Democrat senators proposed a billionaires’ tax that would target about 700 tycoons with more than $US1bn in assets or $US100m in income for three consecutive years.

Mr Biden met holdout moderate senators Kyrsten Sinema and Joe Manchin on Tuesday night, and his aides corralled them again on Wednesday (Thursday AEDT). Both have spent weeks chiselling the original $US3.5 trillion top line to somewhere nearer half that.

In a tweet Wednesday night, the President urged congress to “bring these bills over the finish line”. “Universal preschool. Historic climate investments. Lower health care costs,” he wrote, listing the bill’s major goals. “They’re all within our reach.”

Senate majority leader Chuck Schumer said an agreement was “within arm’s length”, specifying that he was hopeful of a framework agreement emerging by the end of the day.

“The work we do right now will echo far into the 21st century,” he told colleagues on the floor of the Senate. “This is the best opportunity we’ve had in a long time to make sure that the decades to come will offer the same – or even greater – opportunities that Americans ­enjoyed in the past.”

Under the tycoon tax proposal, according to US media, billionaires would begin paying capital gains taxes of 23.8 per cent on the appreciation in value of tradeable assets such as stocks and bonds, ­regardless of whether they are sold. The tax would bring in an ­estimated $US300bn, around a fifth of the expected compromise cost of Build Back Better.

The collective fortune of America’s billionaires soared by 70 per cent during the pandemic, according to the liberal-leaning Institute for Policy Studies, from almost $US3 trillion in March last year to over $US5 trillion two weeks ago.

But Democrats in both chambers, including Senator Sinema and congressman Richie Neal are said to have misgivings, while Senator Manchin appeared to rule out the move as divisive.

“I don’t like it. I don’t like the connotation that we’re targeting different people,” he said.

But there were signs of light, with tentative agreement among the Democrats, who control congress and the White House, on a minimum 15 per cent corporate tax on the profits of companies clearing more than $US1bn a year.

Nearly 200 companies would be subject to the tax, another key revenue raiser that could generate as much as $US400bn, its backers say. Crucially, senators Manchin and Sinema are both on board.

AFP