Home Stock Democratic disagreements imperil Biden agenda as shutdown looms

Democratic disagreements imperil Biden agenda as shutdown looms

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(C) Reuters. FILE PHOTO: The U.S. Capitol is seen in Washington, U.S., September 27, 2021. REUTERS/Elizabeth Frantz/File Photo

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By David Morgan and Richard Cowan

WASHINGTON (Reuters) – President Joe Biden’s agenda was at risk of being derailed by divisions among his own Democrats, as moderates voiced anger on Wednesday at the idea of delaying a $1 trillion infrastructure bill ahead of a critical vote to avert a government shutdown.

The White House said talks over twin bills that would revitalize the nation’s roads and airports and fund social programs and climate change measures, were at a “precarious” point as moderates and progressives disagreed over the scope of some $4 trillion in spending.

Congress, which Democrats control by a razor-thin margin, is due to vote on a bipartisan resolution to fund federal operations through early December before funding expires at midnight on Thursday.

The House of Representatives is expected to vote on Thursday on a $1 trillion infrastructure bill already passed by the Senate, although some party leaders warned that vote could be delayed again – which would dismay moderates.

Representative Stephanie Murphy, a moderate Democrat who backs the infrastructure bill, warned against defeat or delay of the legislation.

“If the vote were to fail tomorrow or be delayed, there would be a significant breach of trust that would slow the momentum in moving forward in delivering the Biden agenda,” she told reporters on Wednesday.

With House progressives warning they will vote against the infrastructure bill until a deal is reached on the separate multitrillion-dollar plan focused on social spending and climate, the vote was not guaranteed.

“The only way the vote happens (Thursday) is if we have the votes to pass the bill,” Representative Dan Kildee, House Democrats’ chief deputy whip, told reporters.

WHITE HOUSE HUDDLE

House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer went to the White House on Wednesday afternoon to meet Biden, a former senator himself, who canceled a trip to Chicago to lead negotiations with Congress.

“We’re obviously at a precarious and important time,” White House press secretary Jen Psaki said on Wednesday.

A White House staffer met at the Capitol with moderate Democratic Senator Kyrsten Sinema, who has expressed deep concern over the size of Biden’s plans and has the power to block them due to the Democrats’ narrow control of the Senate.

If the resolution to fund the government passes the Senate, the House could vote quickly to send the measure to Biden to sign into law, averting a partial government shutdown in the midst of a national health crisis. Biden’s Democrats campaigned on a platform of responsible government after Republican Donald Trump’s turbulent four years in office.

Republican Senator John Cornyn expressed optimism on Wednesday.

“Democrats don’t want to shut down the government. Republicans don’t want to shut down the government. That will supply the result that we all expect, which is to keep the lights on,” he told a news conference.

Senate Democrats have tried to pass legislation that both funds the government and heads off a potentially catastrophic federal government default by raising the nation’s $28.4 trillion debt ceiling. But they have been thwarted by Republicans who want Democrats to use a parliamentary maneuver to act alone on the debt limit issue.

The government will hit the ceiling around Oct. 18, an event that could cause a historic default with long-lasting economic fallout and implications for financial markets.

Schumer has demanded bipartisan cooperation on the issue, arguing that it addresses debts racked up during both Democratic and Republican administrations.

The House passed a bill on Wednesday suspending the limit through December 2022, by a mostly partisan vote. It now goes to the Senate, where it is expected to be blocked by Republicans again.

Investment bank Goldman Sachs (N:GS) this month described the standoff as “the riskiest debt-limit deadline in a decade.”

RECONCILIATION

Several senior Democrats have said the $3.5 trillion “reconciliation” bill – so-called because it is being drawn up under a budgetary procedure to avoid Senate rules requiring 60 votes out of 100 members for passage – will need to be scaled back to pass.

Moderate Democratic Senator Joe Manchin said he believed it would take weeks to reach agreement.

“I cannot – and will not – support trillions in spending or an all-or-nothing approach that ignores the brutal fiscal reality our nation faces,” he said in a lengthy statement late on Wednesday afternoon.

“There is a better way and I believe we can find it if we are willing to continue to negotiate in good faith.”

He did not say, however, what he could support.

House Democrats urged Manchin and Sinema to say publicly what they want.

“They need to come up with their counteroffer and then we sit down and negotiate from there,” said Representative Pramila Jayapal, chair of the House Progressive (NYSE:PGR) Caucus.

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