This will surprise only people who haven’t paid even cursory attention to the last year of Democratic politics, but Sen. Joe Manchin III may have just killed any hopes for a resuscitated version of the Democratic agenda.
Yet as ludicrous as this turnaround is on its face, there are still more hidden absurdities behind the situation that show what a farce it has truly become. They turn on the specifics of what Manchin appeared to reject, and his inflation-related excuse for doing so, which amount to a display of towering bad faith.
First, a caveat: After those stories broke, Manchin claimed on Friday that he’s still open to a deal and wants to see July’s inflation numbers before deciding. So perhaps he just doesn’t want to act quite yet. But given all we’ve seen, let’s inaugurate the Manchin Rule: Until the senator actually shows he’s operating in good faith, we’ll presume otherwise.
The deal would have raised around $1 trillion in revenue from rolling back some of the 2017 GOP tax cuts. Half of that revenue would have gone to deficit reduction, and the other half would have gone mostly to funding the transition to green energy.
Also in the mix were provisions empowering Medicare to negotiate down prescription drug prices, which would produce substantial savings. Those could be used to continue funding expanded Affordable Care Act subsidies, which are set to expire after originally passing in last year’s covid-19 rescue package.
But Manchin has rejected the tax hikes and the climate provisions. For now, he is open only to some kind of deal in which savings from the prescription drugs provisions fund expanded ACA subsidies.
By the way, the subsidies highlight another problem with Manchin’s position. Even if he does just want to delay another month, extending the subsidies this month is critical, because states will soon have to assume they’ll expire and send out notices of premium increases.
Regardless, how Manchin reached this point is hard to discern. As The Post reports, he has long supported tax reforms such as those being debated, yet he seemingly backed away from them, including a measure to close a loophole enjoyed by the very wealthy to sustain Medicare.
What’s more, Manchin is still reportedly telling people he wants to secure a few hundred billion dollars in deficit reduction. How he would do this without raising high-end taxes is unclear.
It gets worse. A Democrat briefed on the conversations says Senate Majority Leader Charles E. Schumer (D-N.Y.) sought to meet Manchin’s concerns about the climate provisions head-on.
This included reducing spending on green energy tax incentives to $375 billion, the Democrat says. It also included nixing incentives for electric vehicles, which Manchin had objected to as well.
And a Democratic aide tells me much of the legislative text on green tax incentives had been written, and haggling was down to minor points. Manchin’s turnaround floored those working on that text, given what had been happening only hours earlier.
A sympathetic reading of Manchin’s motives goes like this. As someone who represents a state that’s both deep red and relies on fossil fuels, he has understandably sought a balance. He’s open to the government facilitating innovation that aids the transition to green energy, but only if it does not inflict damage too quickly on the traditional energy sector or the people reliant on it.
But even so, the dropping of incentives for electric vehicles represents a big concession toward his values. After all, a transition away from gas-powered vehicles is an essential piece of cutting emissions at the pace necessary to minimize long-term risk.
Indeed, the package of climate incentives that still remains plainly falls within the parameters of the balanced approach he wants. That is, if Manchin — who has personally grown rich off the coal industry — means what he says.
Nor does Manchin’s own explanation make much sense. His spokesperson insists we must “adjust to the economic realities the country faces” and avoid “steps that add fuel to the inflation fire.”
But climate change is also a reality, and without something like this agenda, it may be impossible to come close to hitting climate targets scientists say are necessary to avoid disaster.
And how much would the package offered to Manchin actually increase inflation? Economist Dean Baker notes that half would go to deficit reduction, which Manchin wants, and the nixing of incentives for electrical vehicles removes another spending piece.
What’s more, Baker says, spending on ACA subsidies would be offset by less spending on prescription drugs. “It’s basically impossible to see how that would be inflationary,” Baker tells me.
Manchin is free to disagree with that, but he hasn’t offered a serious case that something like this package would disastrously fuel inflation. Nor has he meaningfully explained why whatever inflation it would allegedly produce is worse for the country than the climate future he’s consigning us to.
Instead, he’s betting the word “inflation” will simply turn off our critical faculties. We shouldn’t let that happen. The absurdities behind his position should be mercilessly exposed.
