Holding for the Last Shot
With Biden on the sidelines, Schumer is on the clock
As Congress barrels through the fourth week of a crucial five week work period, Democrats' path forward on reconciliation remains as murky as ever, even as the window for action begins to close. While the chatter has picked up, as have the conversations among key principals, nothing suggests a significant change in trajectory. And should Congress head into the Memorial Day recess with no mutual understanding of what, if anything, can garner 50 votes, the odds of salvaging even the narrowest elements of Biden's domestic agenda on a partisan basis diminish significantly as we enter the summer months.
The optimistic case goes something like this: Senator Joe Manchin (D-WV) and Leader Chuck Schumer (D-NY) are in direct talks, with the hope of reaching some sort of framework agreement by the end of next week. Lessons have been learned from the leaks and public posturing that plagued the first iteration of BBB for nearly a year, and both men are being uncharacteristically tight lipped. Given that the failures to date have been punctuated by outside noise, relative quiet and calm—to say nothing of reduced expectations—is a positive thing for giving them room to find a way to yes.
A grimmer outlook is easier to muster. Bipartisan energy talks spearheaded by Manchin occurred for the fourth time in four weeks, representing an all-but-certain dead end in the near term, while also providing an outlet for the West Virginia moderate to deflect pressure regarding reconciliation. So long as the bipartisan dream remains alive, however nominally, Manchin has a rhetorical escape hatch at his disposal. Whether or not these talks continue in earnest, the lack of resolution—and the new addition of Senator Kyrsten Sinema, with her own set of new ideas—complicate a potential reconciliation pivot.
To the extent there has been a revelation this week, it is the White House’s arms length approach to the reconciliation endgame. If there is a deal to be had, it won’t be Joe Biden, erstwhile master of the Senate, swooping in to save the day. The ball is firmly in the hands of the majority leader as the clock winds down, while the Administration and the rest of the caucus are left to stand back and watch.
This strategy can be read any number of ways. Has the White House determined that there is no deal to be had, or to the extent there is one, the risk is not worth the slimmed-down reward? Or perhaps Manchin himself has indicated, explicitly or implicitly, that he would prefer to deal with Schumer directly, rather than a White House staff he blamed for the previous blow-up in December. Regardless, it amounts to a recognition of residual scar tissue left by a year’s worth of wheel-spinning.
In any event, it remains unthinkable to much of official Washington that Democrats could allow something as precious as a fully primed reconciliation vehicle to simply go to waste. Even if a bigger deal that includes a broad swath of climate investments cannot be reached, there may be an effort to use the privileged legislative tool to move urgent health policy-related fixes. With the looming expiration of premium support measures contained in the American Rescue Plan, there is a growing fear that failure to act might hit Americans with big health insurance bills right before the midterms. (As activists are keen to note, Manchin’s West Virginia constituents may see some of the steepest increases, as much as thousands per month.) If we reach June or July with no progress, expect talks around a health-centric “drug pricing plus” package as a break-glass option, while the appetite for a post-election tax policy bill is certain to grow.
For another week, at least, all eyes remain on the Chuck and Joe show.
[This is an excerpt from the May 20 PRG weekly reconciliation update. Read the rest of my firm’s reconciliation updates here. And if you like my “Bottom Line” analysis, check out my moderated discussion with my colleague Yasmin Nelson, who pens “The Breakdown” newsletter. Watch on Youtube or listen wherever you get your podcast.]