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Democratic divisions emerge on U.S. Senate's $3.5 trillion spending plan

EconomyAug 11, 2021 07:07PM ET
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3/3 © Reuters. FILE PHOTO: The exterior of the U.S. Capitol is seen as Senators work to advance the bipartisan infrastructure bill in Washington, U.S., August 8, 2021. REUTERS/Sarah Silbiger/File Photo 2/3

By Makini Brice and Susan Cornwell

WASHINGTON (Reuters) -Hours after the U.S. Senate approved a $3.5 trillion budget blueprint chock-full of investments in new domestic programs, fissures emerged between the moderate and liberal wings of the Democratic Party over the size and scope of the spending.

Senator Joe Manchin, a moderate Democrat representing the conservative-leaning state of West Virginia, issued a warning shortly after the Senate early on Wednesday passed the budget deal https://www.reuters.com/world/us/paid-leave-clean-energy-preschool-democrats-35-trln-plan-2021-08-09 that would carry out President Joe Biden's top priorities.

Manchin, who often acts as a bridge between his party and Republicans, voiced concerns about potentially "grave consequences" for the nation's debt as well as Washington's ability to respond to other potential crises.

That followed Democratic Senator Kyrsten Sinema's warning that she does not support the $3.5 trillion price tag but would work "in good faith" to develop an alternative to include in implementing legislation.

The plan addresses key Democratic priorities, including climate change and immigration reform, and would create social programs such as universal preschool education and subsidized home healthcare for senior citizens. Progressive (NYSE:PGR) members of the House of Representatives have warned they will not back the bill unless it has enough funding for those goals.

Democrats hold extremely narrow margins in both chambers of Congress, with just one Democratic "no" vote in the Senate or a handful of them in the House enough to doom the bills.

The Senate approved the $3.5 trillion budget plan in a 50-49 vote along party lines, about 14-1/2 hours after passing a $1 trillion infrastructure bill https://www.reuters.com/world/us/whats-us-senates-bipartisan-1-trillion-infrastructure-bill-2021-08-03 in a bipartisan 69-30 vote, proposing to make the nation's biggest investment in decades in roads, bridges, airports and waterways.

Democrats plan to pass the larger package within the next few months, using the "budget reconciliation https://www.reuters.com/world/us/us-senates-reconciliation-process-its-not-way-it-sounds-2021-08-10 process," which allows them to pass legislation with a simple majority vote.

Democratic Senate Majority Leader Chuck Schumer said he believed his party would stick together on the package.

"Look, there are some in my caucus who might believe it's too much; there are some of my caucus who believe it's too little," Schumer said when asked about the concerns by Manchin and Sinema about the $3.5 trillion price tag.

"And I can tell you this: In reconciliation, one, we are going to all come together to get something done. And two, it will have every part of the Biden plan in a big, bold, robust way," Schumer said.

House Majority Leader Steny Hoyer, a Democrat, said the House would suspend a summer break on Aug. 23 to consider the budget resolution.

Manchin and Sinema voted for both measures.

But this fall, when negotiations go into full swing on the implementing legislation, the two legislators likely will roil the waters if they and moderate House Democrats try to shrink spending.

TWIN-TRACK TROUBLE?

The trouble has been brewing for months. In a May 17 letter to House Speaker Nancy Pelosi and Schumer, a group of 59 House Democrats referred to new investments in the range of $7 trillion to $9.5 trillion.

For its part, a bipartisan group of House moderates is demanding that Pelosi promptly hold a vote on the $1 trillion infrastructure bill.

Democratic Representative Stephanie Murphy, a member of the "Problem Solvers Caucus," urged her to schedule it for this month.

"While I support passing a targeted reconciliation bill to help FL (Florida) families, we shouldn’t hold infrastructure hostage to it," she tweeted.

That is at odds with Pelosi and progressives, who demand that the $1 trillion infrastructure legislation and the $3.5 trillion in additional spending move in tandem to ensure that both get through.

Representative Pramila Jayapal, the Congressional Progressive Caucus chair, warned in a tweet on Tuesday: "Progressives have made it clear from the get go: We're not voting for the smaller infrastructure bill in the House until the larger jobs and families package also passes the Senate."

Republicans have railed against the $3.5 trillion spending plan. Senate Republican leader Mitch McConnell, who voted for the $1 trillion infrastructure bill, called the larger proposal "radical."

DEBT CEILING LOOMS

Dozens of Republican senators also signed a pledge not to vote to raise the nation's borrowing capability when it is exhausted in the autumn to try to curtail Democrats' spending plans.

"They (Democrats) shouldn't be expecting Republicans to raise the debt ceiling to accommodate their deficit spending," Senator Ron Johnson, a Republican who circulated the pledge, told the Wall Street Journal.

Biden expressed confidence the matter would be resolved. "They're (Republicans) not going to let us default," he told reporters.

During a conference call with House Democrats, Pelosi rebutted Republicans, saying the debt limit increase would cover past spending.

"This is Trump’s money (spent)," Pelosi said, according to a source familiar with the conversation. "This is paying for his tax scam, this is paying for COVID, a responsibility we all share."

U.S. borrowing swelled by almost 40% to nearly $28 trillion under Republican former President Donald Trump, fueled by the passage of tax cuts in 2017 and coronavirus-related spending in 2020.

Failure to increase or suspend the statutory debt limit - now at $28.5 trillion - could trigger a federal government shutdown or a debt default.

Democratic divisions emerge on U.S. Senate's $3.5 trillion spending plan
 

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Comments (17)
Laerry Yn
Laerry Aug 12, 2021 1:05AM ET
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im not an american or live smewhere in us,but i smell smething fishy about those budget haha.
Roger Pruzansky
Roger Pruzansky Aug 11, 2021 10:57PM ET
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democrats have only 1 thing in mind and that's to tax americans
Kenneth nelson
grasshopper Aug 11, 2021 5:31PM ET
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A Waste
Brians Mac
Brians Mac Aug 11, 2021 10:37AM ET
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McConnell should step aside and let a real repub lead us. McConnell is as senile as ole creepy Joe...
Butch Einsel
Butch Einsel Aug 11, 2021 10:37AM ET
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stay with CNN you'll be happy
Catholic Man
CatholicMan Aug 11, 2021 9:59AM ET
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We all are, it’s full of pork and useless other things.
Saroop Calvete
Saroop Calvete Aug 11, 2021 9:08AM ET
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Remember Solyndra? I see a similar pattern of well-connected DC insiders capturing most of the fund which will go to waste
Kaveh Sun
Kaveh Sun Aug 11, 2021 9:08AM ET
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Or evergreen solar, a123 battery, or fisker cars company, should i continue?
la popeye
la popeye Aug 11, 2021 8:52AM ET
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stop spending on army snd usa will be just fine with ecology,fighting poverty, infrastucture, free school and university....No good 🤔🥴
Catholic Man
CatholicMan Aug 11, 2021 8:52AM ET
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LOL
Matt Brackley
Matt Brackley Aug 11, 2021 8:52AM ET
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what would support the usd?
hit man
hit man Aug 11, 2021 8:40AM ET
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it's mean that's government want all stimulus money back from borrower'. big crash soon
ch hon
ch hon Aug 11, 2021 8:33AM ET
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money will be pocketed and projects will be abandoned.
Klaus Weyers
Klaus Weyers Aug 11, 2021 8:27AM ET
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you have no clue me comment.. the deficits will destroy the economy.. for the people is laughable..
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Andrew Allen
Andrew Allen Aug 11, 2021 8:27AM ET
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you should have been left in special ed. must've been dropped on your head as a child
Andrew Allen
Andrew Allen Aug 11, 2021 8:27AM ET
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me comment I mean
Kaveh Sun
Kaveh Sun Aug 11, 2021 8:27AM ET
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Me comment u r that naive to beleive in everything politicians say. U r hopeless.
Kaveh Sun
Kaveh Sun Aug 11, 2021 8:27AM ET
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Benjamin McIntire u r partially right. If deficit hits 200% gdp, # hit the fan.
Thuan Bui
Thuan Bui Aug 11, 2021 8:27AM ET
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Keep increasing the ceiling... to infinity and beyond 🤣
Me comment
Me comment Aug 11, 2021 8:08AM ET
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Republicans have short memories as they did similar legislation by passing massive tax cut for the rich and corporations that added $3.8 trillion to the nations debt and suspended the debt ceiling to allow it. The infrastructure bills will have little impact on the debt as most will be paid for by tax increases on incomes over $400,000 and corporations. Again uneducated trump supporters making claims with no facts to support it.
Andrew Allen
Andrew Allen Aug 11, 2021 8:08AM ET
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spending adds to national debt, not tax cuts. The cart does not lead the horse dummy
tim banks
tim banks Aug 11, 2021 8:08AM ET
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deciding to cut my own pay while spending the same on food and housing means my debt goes up. hence they made the debt go up
Miles Mathewson
Miles Mathewson Aug 11, 2021 7:30AM ET
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It's the beginning of the end of this once great nation. US debt will be 32 trillion. Just for perspective, the total money in the world today is 80 trillion And some wonder why bitcoin is where it is...people aren't stu_pid, they know this debt is unpayable.
Miles Mathewson
Miles Mathewson Aug 11, 2021 7:26AM ET
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GOP must not raise the ceiling in retaliation of this abusive trillions of waste.
Benjamin McIntire
Benjamin McIntire Aug 11, 2021 7:26AM ET
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GOP is biggest contributor to the debt giving tax cuts to billionaires and mega corps.
Andrew Allen
Andrew Allen Aug 11, 2021 7:26AM ET
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The cart does not lead the horse dummy! SPENDING causes debt NOT TAX CUTS
Josh Davis
Josh Davis Aug 11, 2021 7:26AM ET
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Andrew Allen people who dont undersrand tax law dont understand what trump did. I own businesses and it far helped us stay afloat then someone haining billions. People just repeat what they heard on the tv
Anthony Crowley
Anthony Crowley Aug 11, 2021 7:26AM ET
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Andrew Allen It works both ways Andrew.  Reduce revenues and keep spending level - then more debt is required to maintain.
Anthony Crowley
Anthony Crowley Aug 11, 2021 7:26AM ET
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Most of my small business clients did not see any meaningful reduction of their tax burden as a result of the TCJA.unless it was through bonus depreciation.  Those that benefit the most were individuals receiving K-'1's from real estate related pass though entities.
king michael
king michael Aug 11, 2021 7:11AM ET
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Just another $3.5 trillion bonus for contractors having government connections and bankers. It will only generate more never finished useless waste projects like it was always. Soon, those greedy politicians will ask for a lot more than $3.5 trillions .... until the country got bankrupted. All working American would bankrupt with the nation and the rich people will be a lot more wealthy as it has been.
taylor jason
taylor jason Aug 11, 2021 7:11AM ET
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you make it seem like this will all be spent tomorrow. the infrastructure monies will be spent over the next 10 years of which states how it will be funded. this isn't free money, shows how much you really know vs just drinking the kool-aid without actually understanding any of it
Ron Cole
Ron Cole Aug 11, 2021 7:11AM ET
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It still bankrupts us!
Daniel Hammond
Daniel Hammond Aug 11, 2021 7:11AM ET
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taylor jason we (the tax payer) still have to pay it back and we won’t see much benifit from it. Doesn’t matter how long it takes to spend we have to start paying it back now.
Jim Jones
Jim Jones Aug 11, 2021 5:29AM ET
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Good luck hiring 100,000 police. They make more on welfare than they would by sitting in their car doing nothing.
Joseph Armour
Joseph Armour Aug 11, 2021 5:29AM ET
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I am sure there are plenty of individuals who want to dominate, humiliate, and hurt others while simultaneously being given awards for doing so.
Randolph Russ
Randolph Russ Aug 11, 2021 5:01AM ET
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So sad. Entrenched in socialism. Can i take my vote back from Romney who is now my neighbor???
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Trent Jenkins
Trent Jenkins Aug 11, 2021 5:01AM ET
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Daniel Hall  why should fat lazy rich people who dont work get the lion share of the profits ?
taylor jason
taylor jason Aug 11, 2021 5:01AM ET
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since when is having roads socialism?
Catholic Man
CatholicMan Aug 11, 2021 5:01AM ET
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Budiness owners and their ideas created the wealth.
Catholic Man
CatholicMan Aug 11, 2021 5:01AM ET
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taylor jason it’s not, but roads are s very small part if this.
Anthony Crowley
Anthony Crowley Aug 11, 2021 5:01AM ET
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Catholic Man  Then let's put a wealth tax into place.  Seems to me that those with the most to lose can pay most of the cost of a military needed to protect their assets.
Tre Hsi
Tre Hsi Aug 11, 2021 4:28AM ET
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"Dozens of Republican senators also signed a pledge not to vote to raise the nation's borrowing capability when it is exhausted in the autumn"  -- PR stunt, empty threats since we all know they won't risk another govt shutdown
IceIce Baby
IceIceBaby Aug 11, 2021 4:28AM ET
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Yeah, but they have to raise concerns to get later some benefits from Dems.
Daniel Hall
Daniel Hall Aug 11, 2021 4:28AM ET
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maybe, but I have a feeling most of their constituents would rather see the government burn to the ground than let the larger package pass. It isn't just reckless spending to them. It is a threat to their beliefs and way of life
taylor jason
taylor jason Aug 11, 2021 4:28AM ET
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your lack of knowledge on the subject is incredible. this is not socialism. not even close. passing a bill that raises taxes for some to rebuild the countries infrastructure is basic government financing, not socialism. socialism would be of the government seized apple and said all of apples profits would be for the us people.
Ronald Warren
Ronald Warren Aug 11, 2021 4:28AM ET
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taylor jason They're commenting on the bogus 3.5 trillion dollar stimulus, not the 1 trillion infrastructure deal. All wasteful spending. let local governments tax, toll, do what they must to maintain themselves.
 
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