The Case for a Smaller Reconciliation Bill

Democrats shouldn’t obsess about $3.5 trillion or curse Joe Manchin. Smaller still gets you a lot—and it’s easier to sell.

Impatient progressives have pinned their ambitions on the massive social spending bill Democrats want to pass through “reconciliation,” a special track for bills that avoids the Senate’s dreaded filibusters. The Democrats’ $3.5 trillion package would “touch virtually every American’s life, from conception to aged infirmity,” as The New York Times put it, offering such benefits as paid leave, universal preschool, free community college, and expanded Medicare.

Many on the left insist that the bill fund the entire $3.5 trillion authorized by Congress in August, but Democratic Senator Joe Manchin—whose vote is essential even under reconciliation—has indicated that he would only support something smaller. Senate Budget Committee Chair Bernie Sanders condemned this stance as “not acceptable,” arguing that progressives have already compromised too much. “I don’t think [a smaller package] is acceptable for the president, to the American people, with the overwhelming majority of the people in the Democratic caucus,” Sanders told CNN.

But it would be a mistake for progressives to declare “$3.5 trillion or bust!” A slimmer bill has distinct advantages, even setting aside the electoral needs of vulnerable moderates on whom the Democratic majority hinges.

First, achieving any one of the package’s major planks would be a historic accomplishment. Democrats will not have “failed” if they pass three-fourths of what they want or even half; the impacts on Americans’ lives will still be transformational.

Take, for instance, the Democrats’ proposal to make the temporary expansion of the child tax credit included in this year’s American Rescue Plan permanent. This legislation entitles all families with children—even those too poor to pay taxes—to receive up to $3,600 per child this tax year, payable in monthly deposits so there’s no waiting around until April 15 for a check. As we’ve written, it’s a revolutionary idea, in both execution and effect.

Hunger rates among families with children have already dropped by nearly 24 percent, according to government data, as a result of the first tranche of payments made in mid-July. Making the credit permanent, the Urban Institute estimates, would lift more than 4.3 million children out of poverty, slashing America’s child poverty rate by more than 40 percent.

This is almost double the impact of Bill Clinton’s signature expansion of the Earned Income Tax Credit for working-poor families in 1993. Hailed then as the nation’s most significant antipoverty initiative since the War on Poverty, the expanded EITC raised 2.4 million children out of poverty by 1996, its first full year of availability. But even then, the child poverty rate was still a shockingly high 19.8 percent.

Biden’s child tax credit would bring the poverty rate down to 8.4 percent—a level that has not been reached since the Census Bureau started keeping track in 1959. If extending the child tax credit is all Democrats pass, it would still be a monumental triumph.

Another potentially transformational stand-alone achievement is Democrats’ contemplated expansion of Medicare. Lowering the Medicare eligibility age to 60, one option under consideration, would make the program newly available to 23 million Americans, many of whom are uninsured or faced with unaffordable premiums for private coverage as they’re squeezed out of the workforce. Providing dental, vision, and hearing benefits would eliminate the privations endured by those who can’t afford care. Three in four Medicare beneficiaries who need a hearing aid don’t have one, according to the Commonwealth Fund, and nearly half of seniors with vision problems have skipped eye exams in the past year. More than two in three who have trouble eating because of the condition of their teeth can’t afford to go to the dentist.

It doesn’t require $3.5 trillion to bring big changes to Americans’ lives. Making the child tax credit permanent would cost about $1.6 trillion over 10 years, while adding hearing, dental, and vision coverage to Medicare could cost about $358 billion, depending on the size of the benefits. Lowering Medicare eligibility to age 60 would be a relative bargain by comparison, costing an estimated $200 billion over 10 years. That’s more than Manchin has said he’d countenance, but it’s a lot less than $3.5 trillion.

Of course, Democrats want to do it all, but drawing on a smaller canvas could be better for the party.

A tighter, more focused bill is easier for the public to understand. By this point, Democrats should know that technocratic 10-point plans can’t match the primal simplicity of “Build the wall.” A large, complex bill is easier for Republicans to attack. Republican Senator John Barrasso, for example, recently slammed the Democrats’ package as “a radical freight train to socialism.” But it’s not a freight train if it has just three or four cars.

Biden himself is thinking leaner as he wades into negotiations, “pushing programs whose benefits voters can easily grasp,” according to TheWashington Post. “The president is focused on having government deliver in a way that people can see and feel in their lives,” senior adviser Mike Donilon told the Post.

A targeted bill would also force Democrats to focus on a few clearly defined priorities, sharpening their economic message heading into the 2022 and 2024 elections. With Biden’s poll numbers slipping, the Delta variant raging, and the economy still on uncertain footing, Democrats must make a clear-cut case for why they should keep control of Congress. (“Build Back Better” is a witty and alliterative slogan, but it’s vague and far from a clear message.)

As it is, Democrats are having trouble selling what they’ve accomplished. For instance, as the Washington Monthly’s Bill Scher has pointed out, Democrats haven’t been getting credit for the expanded child tax credit, perhaps because it was slipped into the last COVID-19 relief package with little fanfare or debate.

Some progressives argue that Democrats must grab everything they can because they’ll likely lose the House in next year’s midterms, and possibly the Senate, too. This use-it-or-lose-it perspective forces moderates to take votes untenable in their states or districts, and therefore speeds, rather than dampens, the likelihood of losing one or both chambers. It’s a gloomy strategy that assumes Democrats will not regain seats in 2024—and that Biden won’t win a second term. Nor will it lead to politically enduring accomplishments. As we learned with the Affordable Care Act, the implementation of legislation is as important as its passage. Though Donald Trump and congressional Republicans ultimately failed to “repeal and replace” the ACA, their sabotage inflicted serious damage. Americans won’t benefit from Democratic legislative victories in reconciliation if a Republican administration immediately seeks to undermine them. But that’s less likely if overturning Biden’s signature legislation means rolling back Medicare benefits for millions of seniors or raising taxes on American families by abolishing the child tax credit.

Democrats shouldn’t get fixated on a number. Take a longer view, with a strategy and tactics geared toward building a sustainable governing majority. A leaner reconciliation bill is still plenty big, and it just might be the best way to persuade voters that the best is yet to come.

Support Nonprofit Journalism

If you enjoyed this article, consider making a donation to help us produce more like it. The Washington Monthly was founded in 1969 to tell the stories of how government really works —and how to make it work better. More than fifty years later, the need for incisive analysis and new, progressive policy ideas is clearer than ever. As a nonprofit, we rely on support from readers like you.

YES, I'LL MAKE A DONATION

Anne Kim

Anne Kim is a Washington Monthly contributing editor and the author of Abandoned: America’s Lost Youth and the Crisis of Disconnection.