At any other time, the imminent House passage of a gargantuan $1.9 trillion bill that addresses many of the foundational goals of a new presidency would be regarded as a smashing victory for a White House only six weeks into a first term.
Yet the extreme circumstances of a pandemic, an ex-President’s impeachment trial and a partisan split over the contents of the legislation have so far tended to obscure the Covid relief plan’s significance.
The bill, which the House of Representatives is expected to pass Friday with Democratic votes, has the symbolic weight and financial power to define what Biden hopes will be the post-pandemic period as it aims to quell the virus and trigger a rebound from the economic ruin in its wake. That remains true despite the Senate parliamentarian ruling Thursday that a provision raising the federal minimum wage to $15 an hour infringes the budgetary process known as reconciliation that Democrats plan to use to pass the package with a simple majority. The decision was a blow to progressives but could ease Democratic divisions over the package and make it easier to pass.
President Joe Biden told a bipartisan group of governors on Thursday that the economic toll of the pandemic is tearing through the country as brutally as the virus and that Washington had no choice to step up with the rescue package. “Instead of chasing Covid-19, (the bill) allows us to get ahead of it, with more testing supplies and vaccinations,” Biden said.
The plan’s mammoth size – more than twice as big as the Great Recession stimulus plan that Biden managed in the Obama presidency and nearly half the cost of the annual federal budget – hints at the enduring political shadow it will cast.
The measure is intended to significantly beef up the vaccine drive that will hopefully end the pandemic and to provide funds for remodeling schools to improve ventilation and social distancing to get millions of kids back into class. It would also use the power of government to alleviate short-term economic pain – for instance by granting $19 billion to state and local governments to cover back rent and utility payments – and on a more permanent basis, to share the benefits of the US economy more equally.
Proposed stimulus payments of up to $1,400 extra dollars to some Americans and extended unemployment benefits through August would deliver on fundamental promises that won Biden the presidency and made Trump a one-term president.
“It’s about putting vaccinations in the arm, money in the pocket, children in the schools, workers in their jobs. It’s what this country needs,” House Speaker Nancy Pelosi said on Thursday.
A bill that is already defining the midterm elections
The measure won’t survive in pristine form in the Senate, as the parliamentarian’s ruling proved Thursday evening.
Yet even without the minimum wage provision, the legislation is already defining the politics running up to the midterm elections next year and beyond, and would enshrine those trends if Biden can navigate a narrow path for it through an evenly divided Senate with the likely help of the tie-breaking vote of Vice President Kamala Harris.
Unwilling to hand the new President a big victory – and partly to try to force a partisan vote to undercut Biden’s popular impulse to work across the aisle – Republicans in the House and Senate have been coming out strongly against the bill. Using its 2009 playbook, the GOP is attacking the legislation as a massive, liberal giveaway, apparently seeking to create a backlash similar to the Tea Party movement that helped it capture the House a decade ago. GOP lawmakers also argue that some of the money provided under previous stimulus packages signed by former President Donald Trump has not yet been used up so more spending is premature.
“Pelosi, (Senate Majority Leader Chuck) Schumer and Biden decided to use a pandemic to push forward a progressive wish-list items to reward political allies, friends and donors at the expense of the American working class,” Rep. Jason Smith of Missouri, the top Republican on the House Budget Committee, said this week.
Republicans are pointing out that not all of the money included in the plan is for emergency aid. They highlight, for instance, that some of the $130 billion reserved for education will flow over the next few years. But some of those funds are actually meant to forestall teacher layoffs next year that are a direct result of the pandemic that has devastated many state and local budgets.
Republicans are taking a gamble in opposing a bill that a majority of the public regards as necessary during the worst domestic crisis since World War II. If the legislation succeeds, Biden will use it to turn the tables on Republicans who are banking on the traditional President’s first-term curse to help them seize back the House and the Senate in November 2022. And he might point out that Republicans who are accusing Democrats of overspending were happy enough to pass Covid relief plans – and to balloon the deficit – when a Republican was in the White House.
Still, should the pandemic and its economic detritus linger for many more months, forcing Biden to return to the Hill for another rescue plan, the GOP will be in a position to brand his most ambitious gambit a failure. And there are already signs that Republicans will use the scale of this rescue plan to argue there is no money left for other Biden priorities like tackling climate change.
While clarifying the philosophical divide between the parties, the American Rescue Plan has also revealed the limits of Biden’s aspirations to seek bipartisan solutions. White House talks with a group of 10 GOP senators who drew up a $600 billion counter-offer served mostly to emphasize the vast gap in perception over the size of the crisis between Republicans and Democrats.
They also revealed tensions that may become more significant in time between Republican senators and the White House. Maine Sen. Susan Collins, for instance, was outspoken in criticizing the role played by Biden’s chief of staff Ron Klain.
The two-trillion-dollar megalith has also teased out splits within the Democratic Party — with some prominent progressives clashing with moderates like Sen. Joe Manchin of West Virginia, who used the power of his swing vote in the chamber to highlight his own less ambitious $11 minimum wage plan.
There have also been signs of nervousness on the left of the Democratic Party over the extent of Biden’s ambition. The President has yet to tip his hand on key elements of the measure that might be up for negotiation. The intervention by the Senate parliamentarian may make the bill simpler to pass since it will defuse a confrontation between Democrats over the minimum wage.
But the decision immediately set off a new debate in the party with progressives warning that the only way to pass a stand-alone bill on a minimum wage hike would be if Senate Democrats abolish the filibuster that effectively means major legislation needs 60 votes to pass in the 100-vote chamber. Such a move would set off a firestorm between Republicans and Democrats – and could come back to haunt the current majority if Republicans take back control of the Senate and there is a Republican in the Oval Office.
Biden faces mid-March deadline
Delays in confirming some of the President’s Cabinet members have also caused some skittishness over whether he is moving sufficiently quickly to maximize the apex of his power in his early months in office.
While Obama passed his economic rescue plan that eventually reached $800 billion in 2009, in early February, Biden isn’t doing too badly by comparison with other predecessors. It took President George W. Bush until June of his first year in office to sign the $1.3 trillion tax cut that was the centerpiece of his first-term agenda. While President Bill Clinton signed a flurry of legislation in his first days in office, his big ticket economic plan, which passed without a single Republican vote and turned deficits into a surplus by the time he left office, wasn’t enacted until August of his first year in office, in 1993.
Biden cannot afford to wait that long, not least because federal unemployment benefits are currently set to expire on March 14. An estimated 11 million people could eventually lose unemployment benefits if the bill doesn’t pass. And another 730,000 Americans filed first-time jobless benefits last week, underscoring the total collapse of industries in the hospitality and travel sector, for example.