Time to Deliver on “Build Back Better”

On Monday, the U.S. House returns (early) from its August recess to take up President Biden’s campaign promise to “Build Back Better” as well as historic voting rights legislation. In recalling the House, Speaker Pelosi told her caucus, “this is no time for amateur hour” and we know that Pelosi is no amateur.

As always, the procedural details are complex, but the essence of Pelosi’s strategy, which Biden has endorsed, is clear. She has a three-vote margin in the House and both Progressives and Moderates are threatening to rebel, denying the votes to advance the Build Back Better agenda. That agenda is hugely popular with the American people. By advancing both the Senate’s bipartisan infrastructure bill and the larger “human infrastructure” plan with the same procedural vote on Monday, Pelosi forces compromise.

Some of the key features of the American Families Plan that will pass only through reconciliation are extending the Child Tax Credit (the American Rescue Plan implemented it in July to end by December); adding vision, hearing, and dental coverage to Medicare; making prescription drugs more affordable by allowing Medicare to negotiate drug prices; lowering health insurance premiums for those who pay for their own insurance; guaranteeing free Pre-K and 2 years of post-high school education; and making child and dependent care affordable.

As Taegan Goddard’s Political Wire observed,

There’s no path in which either extreme can block the other without simultaneously blowing up their own policy goals.

By linking the two bills, Pelosi turned her narrow House majority from a weakness into a strength.

https://politicalwire.com/2021/08/18/nancy-pelosi-once-again-has-all-the-leverage/

There will still be much work to be done. Once Monday’s budget resolution passes, House Committees will begin to draft legislation to pass various elements of the plan. But by signaling that the $1 trillion “hard” infrastructure plan will not move through the House without most of the $3.5 trillion “human infrastructure” proposals in Biden’s agenda, this vote sets the stage for the success of “Build Back Better.”

Treasury Secretary Janet Yellen explained in an op-ed why both tracks are so important:

For more than a generation, America has underinvested in the public goods that are the foundation of our economic growth: infrastructure, education, childcare.

Our funding for them has been on a downward trajectory for nearly forty years. In 2019, it was about three-quarters of what it was in the 1970s. …

It’s important to understand how Build Back Better fits into our economic history. During the postwar years, the United States was almost certainly the best place to start a business or a family. But about a generation ago, economists started to observe a set of worrying trends that threatened the proposition….

Fortunately, fiscal policy works both ways. The lack of it can amplify destructive economic forces, but its ambitious use can unwind them. That is the big idea underneath President Biden’s economic proposals. …

Some have asked: “Are we overinvesting here?” My response is “no,” and there are at least three compelling reasons.

Yellen then lists these reasons:

  • First, if we are going to make these investments, now is the right time. Real interest rates are currently negative, and payment on our public debt, as a share of the economy, is expected to remain below historic levels for at least a decade.
  • Second, the Build Back Better proposals are fiscally responsible. The investments are spread out over time, and total around one percent of our gross domestic product over the course of the decade. They’re also paid for over the long-term through a reformation of the tax code that will make it fairer, without touching Americans who make less than $400,000 a year.
  • Third, and most importantly, we have to consider the opportunity cost of not making these investments. We’ve grown used to America as the world’s greatest economic power, but we aren’t destined to stay that way.

And, goes on to say:

I question whether we can if we remain a country where renting a home eats up the lion’s share of your paycheck, and owning one is out of the question; where young people can’t gain the skills to compete in the job market because they can’t afford the tuition bill; or where Americans must make a choice: have children or have a job.

The Build Back Better agenda will address these challenges. It will bolster our economic growth and productivity, while bringing down some of the largest cost drivers for American families.

Indeed, the crucial question isn’t “What if we make these big investments?” It is: “What if we don’t?”

Emphasis added.

Meanwhile, conservative groups are targeting Mark Kelly and other Senators facing midterm elections based on the sheer size of the $3.5 trillion package — without even attempting to argue on the merits those popular policies. But, as Speaker Pelosi told her caucus in a private call this week:

 For the first time, America’s children have leverage. I will not surrender that leverage.

Sources:

Dear Colleague on Passing Budget Resolution to Deliver Once-in-a-Generation Progress For The People, Speaker Pelosi News Release, August 17.

House leaders will press ahead with a vote to advance a $3.5 trillion budget plan, NY Times, August 17

Pelosi loses patience with centrists on infrastructure deal, Politico, August 17

“No time for amateur hour”: Pelosi dismisses threat from House moderates over Biden budget bill, Salon, August 19

Medicare expansion and a lower eligibility age are included in Democrats’ $3.5 trillion budget plan, CNBC, August 9

Nancy Pelosi Once Again Has All the Leverage, Political Wire, August 18

Janet Yellen: Biden’s infrastructure plan is a down payment on the economy America can – and should – have – Yahoo Finance, August 17

Conservative group targets Kelly, Hassan over $3.5T spending plan, The Hill, August 18

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