House Democrats narrowly passed President Biden’s $1.7 trillion social and environmental spending bill Friday over unified Republican opposition — and despite an official warning that it could add more than $350 billion to the nation’s deficit.
The 220-213 vote followed months of negotiations that cut the cost of Biden’s “Build Back Better Act” in half and multiple delays to win support from both the moderate and progressive wings of his party.
The massive spending plan also had to be decoupled from the $1.2 trillion infrastructure bill that Biden signed into law earlier this week, even though progressives initially demanded that they be packaged together.
Hours before the vote, House Minority Leader Kevin McCarthy (R-Calif.) delayed Speaker Nancy Pelosi’s (D-Calif.) plans to bring the bill to the floor Thursday evening by using his “magic minute” to conduct a record-breaking, 8-hour-33-minute floor speech blasting the measure in addition to other progressive policies.
Only Rep. Jared Golden (D-Maine) broke ranks to side with the GOP in the closely divided House, where Pelosi could afford just three Democratic defections and still get the bill passed.
Biden’s signature spending plan faces an uncertain future in the evenly split Senate, where two moderate Democrats — Joe Manchin of West Virginia and Kyrsten Sinema of Arizona — have repeatedly objected to various provisions and demanded that it not add to the country’s crushing debt burden.
During McCarthy’s marathon floor speech, he called the proposal “the single most reckless and irresponsible spending in the history of this country.”
“Never in American history has so much been spent at one time. Never in American history will so many taxes be raised and so much borrowing be needed to pay for all this reckless spending,” the GOP leader said.
“Every page of all this new Washington spending will be paid for by, or borrowed from, you: America’s hardworking taxpayers. Every page of all this new Washington spending supports more waste, fraud, abuse, and corruption.”
With inflation pushing prices higher ahead of the Christmas holiday shopping season, McCarthy warned that “every page of all this new Washington spending shows just how irresponsible and out of touch the Democrats are to the challenges Americans are facing.”
Democrats railed against the hours-long speech, with Pelosi telling the chamber Friday morning that out of “respect to those who work in this Capitol, and as a courtesy to my colleagues, I will be brief” before praising those who worked to craft the bill and lauding it as a necessary step in combating climate change and expanding social programs.
“This victory is possible because of the tireless and value-based leadership of our chairs, members and staff of the committees and of members,” she said. “I just want to acknowledge the staff of this institution, the House of Representatives, for their just being there for us over and over again, regardless of when and where. Thank you so much. Build Back Better is a better agenda for workers, families and children and for our planet. If you believe, as I do, that this planet is God’s creation and we have to be good stewards of it, this bill is for you.”
Biden has repeatedly claimed that his plan would be fully paid for by tax hikes on high earners and large corporations.
But shortly after 6 p.m. Thursday, the nonpartisan Congressional Budget Office said its analysis — which some moderates demanded to see before casting their votes — showed that Biden’s plan would add $367 billion to the budget deficit over 10 years.
That prediction doesn’t include the idea that “additional revenue that may be generated by additional funding for tax enforcement,” the CBO said, although it also said a proposal to spend an additional $80 billion on IRS enforcement would raise $207 billion in revenues, for a net gain of $127 billion over the next decade.
The White House has claimed it will rake in $400 billion in additional taxes. On Tuesday, the administration tried to pre-empt the CBO, with deputy press secretary Andrew Bates claiming the agency “does not have experience analyzing revenue amounts gained from cracking down on wealthy tax cheats.”
On Thursday evening, the White House released competing figures that it said reflected “full scoring” by the CBO, the Congressional Joint Committee on Taxation and the Treasury Department. Those figures showed a $112.5 billion decrease in the budget deficit over 10 years.
Rep. Stephanie Murphy (D-Fla.), a co-chair of the moderate Blue Dog coalition, told reporters ahead of the vote that she’d spoken with White House adviser Brian Deese, director of the National Economic Council, who “helped to walk us through the numbers and clarify questions that we had.”
“What I saw is that if you take the Treasury estimates on the IRS provision, we end up with a surplus, and I have received sufficient information to understand how Treasury gets to their estimate, because they are the ones that implement the IRS provisions,” she said.
“And I have confidence in that estimate, and taken into account with the CBO spend information, I feel like this bill is in good fiscal discipline standing.”
But James Lucier, managing director of Washington-based strategic policy analysis firm Capital Alpha Partners, told The Post, “This is absolutely, positively not a program that is paid for.”
“The CBO score is not measuring two important things: one, the cost of extracting so many tax dollars from the economy,” he said. “Two, it will also not include the economic costs of misallocating government dollars. You can’t assume the government spending will be as efficient as individual spending.
“The House bill is going to be in the shredder as soon as it goes to the Senate,” he predicted.
Lucier also noted that the House bill contains an $8 billion tax on methane, which is a key component of natural gas fuel.
“That will not go over well when people find their home heating costs are up about 30 percent this winter for homes that heat with gas, according to the Energy Information Administration figures,” he said.
Critics say the bill’s overall cost would actually have exceeded $4 trillion if Democrats hadn’t included sunset provisions for some programs that are party priorities and likely to prove popular with the public — and be hard not to continue.
They include tax credits for children and low-earning workers, which under the plan would be extended for just one year.
Biden’s plan includes $109 billion to provide free preschool for 3- and 4-year-olds, in addition to home health care for seniors, new Medicare coverage for hearing, a new requirement for four weeks of paid family leave and billions in funding for clean-energy programs, including $7.5 billion for a network of electric-vehicle charging stations.
A last-minute change would also raise the cap on deducting state and local taxes from $10,000 to $80,000 — a potential boon for residents of high-tax states including New York, New Jersey and Connecticut.
It’s unclear if that provision will survive in the Senate, where plans to provide paid family leave and reform immigration laws will likely wind up on the chopping block.