Massive Overreach

President Biden wants people to believe he is a moderate. The plan he presented to Congress and the nation Wednesday evening was more like a Progressive wish list.

In case you missed it, here is the Transcript of Biden's Speech.

I discussed pre-disclosed details yesterday in Biden to Propose a $1.8 Trillion "Family Plan" in a Prime Time Address

Wednesday evening Biden added climate change, a $15 minimum wage, right to organize, gun control, paycheck fairness, defense spending, charging stations, even a goal to cure cancer.

He kicked things off with a catchy phrase “My fellow Americans, trickle-down economics has never worked. It’s time to grow the economy from the bottom and middle-out.

The Big Lie

Biden jumped from that catch phrase immediately to a big lie: "A broad consensus of economists – left, right, center – agree that what I’m proposing will help create millions of jobs and generate historic economic growth."

There is no "broad consensus".

His plan cannot possibly pass the Senate as is, and I rather doubt it can even make its way unscathed through the House. 

Dead on Arrival

Biden cannot afford to lose a single Democrat Senator but many have already expressed Reservations Over Tax Hikes.

  • Sen. Joe Manchin (D., W.Va.), a pivotal centrist lawmaker, said Congress should focus on raising revenue by enhancing enforcement for existing tax levels. “It intrigues me to understand that we have 400 billion to a trillion dollars that people have stated that we haven’t collected; don’t you think we ought to look at that first?” he said. “I’ve been very clear on 25% corporate, but I want to see basically where our loopholes are and why we’re not collecting and why the IRS has been eviscerated.”
  • Sen. Bob Menendez (D., N.J.): “For me, it is what you’re doing, the totality of the package, and how does it affect the ability of growth to continue to take place. That’s how I’m judging it. Right now it seems like a rather high rate to me,” said Sen. Menendez, a member of the Senate Finance Committee, of the proposed capital-gains rate. New Jersey has one of the highest median household incomes in the U.S.
  • Sen. Ron Wyden (D., Ore.) chairman of the Senate Finance Committee, has put forward an alternative to the president’s proposal for the capital-gains tax. Under his approach, unrealized gains for wealthy people would be taxed annually, which would limit the tax benefits for people waiting to realize their gains even more than the president’s plan would.
  • Sen. Angus King (I., Maine), who caucuses with Democrats. “I want to understand what it would raise in the way of revenues. I want to have some research on what, if any, impact it would have on stock ownership. But fundamentally I’ve always had a hard time explaining to somebody who pays straight taxes when they work 40 hours a week, why they pay twice as much as somebody who gets a check in the mail.”
  • Sen. Jon Tester (D., Mont.) said that he didn’t want the spending to contribute to deficits, which have piled up during the pandemic. “My answer to that would be hell, I don’t want to raise any taxes, but I don’t want to put stuff on the debt, either,” he said. “But if we’re going to build infrastructure we have to pay for it somehow. I’m open to all ideas.”

Consensus? 

Biden cannot even corral the Democrats. The above quotes are from the WSJ.

Two Keys

At a minimum there are at least two keys to the lock. In addition to Manchin (as usual) we can now safely add Menendez. 

Wyden's idea to tax gains annually is the worst of the lot. About all that will do is sow confusion because it's going nowhere.

The non-budget items will not stand up to a filibuster. But the whole plan is so overreaching that it's possible nothing passes.

Call For Unity

Biden finished with a plea to be united. But kowtowing to the Progressives is a sure way to go it alone.

Ultimately, I expect Biden to rally the troops and settle for whatever Manchin, Menendez, and Senator Krysten Sinema (D, AZ) will go along with, but it will be a huge struggle.

Mish