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Biden Plays Mother Hen, Reduces Build Back Better Proposal to $2 Trillion

Biden tries to soothe progressives and moderates. Will either be happy?
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Manchin Sticks With $1.5 Trillion

Biden Plays Mother Hen

In an attempt to appease the Progressives, Biden Says Democrats Should Delay Infrastructure Vote Until Deal Reached

President Biden called on House Democrats to hold off on voting on a roughly $1 trillion infrastructure bill until after they reach an agreement on a separate social-policy and climate bill, moving to again delay final passage of a central piece of his own agenda in a bid to unify restive Democrats. 

Even as Mr. Biden endorsed progressives’ push to hold up a vote on the infrastructure bill, however, he acknowledged in a closed-door meeting with House Democrats on Friday that the price tag of the social-policy and climate bill would need to drop substantially below $3.5 trillion to closer to roughly $2 trillion, according to lawmakers and aides.

Democrats initially had set the social-policy and climate bill at $3.5 trillion, though Mr. Biden told House Democrats that negotiations with centrists would likely bring its cost in the range of roughly $2 trillion, according to lawmakers and aides. Lawmakers said Mr. Biden mentioned possible toplines from the bill ranging from $1.9 trillion to $2.3 trillion.

Even a smaller bill can make historic investments,” Mr. Biden told House Democrats, according to two people familiar with his remarks.

Mother Hen

The whole reconciliation process started to unravel this week with moderates insisting infrastructure pass first and Progressives talking an all or nothing stance on price and the order of passage.

Biden tried to appeal to both groups. He sided with Progressives in that infrastructure will not pass stand alone. 

He sided with the moderates dropping spending from $3.5 trillion to 

What About Manchin?

Bernie Sanders wanted $6 trillion and Biden targeted 3.5 Trillion. 

Senator Joe Manchin said he would support $1.5 trillion. Arizona senator Kyrsten Sinema is still a budgetary unknown. 

Bear in mind these amounts are in addition to $1 trillion on infrastructure.

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Biden is pressing Manchin for an additional $0.4 to $0.8 trillion over his long-stated $1.5 trillion.

Will Manchin Go Along? The Progressives? 

My best guess is yes to both in the range of about $1.95 trillion.

It will be a huge waste of money and inflationary at least initially. 

But even if we assume something like that will pass, the nature of the climate deal and how fast clean energy demands phase in will determine the nature of the stagflation/recession outcome.

Nothing Beats Nothing

None of the packages being debated are better than doing nothing at all. And as long as the Progressives and Manchin hold firm, nothing will get done.

Yesterday I commented: Unfortunately, I suspect there will be a compromise by Manchin and a package closer to $2 trillion will get passed with Sanders and AOC screaming every step of the way, until something is approved.

Mother hen has now given up on the whole hog, so here we are.

Thanks for Tuning In

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