House Democrats may not take up their own budget blueprint next month and instead may wait to see what the Senate can produce, according to Budget Chairman John Yarmuth.
Yarmuth, D-Ky., had planned to mark up a fiscal 2022 budget the week of July 12. But he said after a caucus meeting Tuesday that party leaders hadn't yet decided whether they will have the votes to adopt a separate House budget resolution or if they need to wait to see what can get through the Senate.
A budget resolution is needed to provide the instructions to relevant committees for drafting the massive filibuster-proof fiscal package to implement much of President Joe Biden’s domestic agenda.
“One decision we have to make is whether to wait for the Senate to do a budget resolution, pass it and send it to us and then just pass theirs or do our own markup. And that decision we haven’t made yet,” Yarmuth said.
Part of the calculus for House Democrats is they don't know what the Senate will be able to push through that chamber.
Senate Democrats can’t afford any defections, and there’s a vast fiscal gulf between Senate Budget Chairman Bernie Sanders, who’s willing to add trillions of dollars in debt to finance a $6 trillion package, and West Virginia Democrat Joe Manchin III, who wants the whole thing offset. Manchin said over the weekend that Democrats may not be able to find more than $2 trillion in palatable offsets.
Yarmuth suggested Manchin’s influence was overblown since almost every Democratic vote is needed in both chambers to pass a reconciliation bill. “I think this emphasis on Joe Manchin is ridiculous,” he said.
Still, Yarmuth appeared to acknowledge the Senate’s sway over the process by wavering on whether his chamber would act on its own budget blueprint.
“I’m sure that there are members of our caucus who are wary of voting for any budget resolution,” the Budget panel chairman said. “We have very slim margins here, and it might be hard to get people to vote for a budget resolution that's not the same as the Senate resolution.”
Senate Majority Leader Charles E. Schumer has said his plan is to bring a budget to the floor before the August recess. But some sources have said it could take longer for Schumer and Sanders to round up the 50 votes needed to proceed, with Vice President Kamala Harris able to break a tie.
‘Cap and trade’ lessons
Some House Democrats — including Budget Committee member Scott Peters of California, a leading moderate on fiscal issues — have cautioned House leaders to wait for the Senate to act rather than make Democrats in their chamber take a tough vote on something that can’t get through the Senate.
In an interview last week, Peters pointed to the House Democrats’ vote on climate change legislation in 2009 that would have created a “cap and trade” system requiring companies to curb their greenhouse gas emissions or pay for emission allowances.
The measure squeaked through the House, 219-212, after 44 Democratic defections. The Congressional Budget Office found the plan would raise energy costs for households, and the overall effort was scuttled in the Senate, including by Rust Belt Democrats concerned about the impact on local industry.
Republicans took back the House in a landslide the following year.
Rep. Stephanie Murphy, D-Fla., co-chair of the fiscally conscious Blue Dog Coalition, said Tuesday that it makes sense to see where the votes are in the Senate before the House acts.
“We should be working with the Senate to see what the votes would bear in the Senate so we can move that expediently,” Murphy said. “The back-and-forth doesn’t really serve anyone, given the schedule.”
Rep. Ilhan Omar, D-Minn., the Progressive Caucus whip, likewise suggested she’d be more comfortable waiting for the Senate to deliver a budget resolution.
“I think that there is the support that it comes from the Senate before it does from the House, that the generation of it should be left to the Senate,” Omar told reporters.
Rep. Pramila Jayapal, D-Wash., the Progressive Caucus chair, said she “generally” prefers the House to act first but is open to letting the Senate take the lead. She said her group is “working very closely” with Sanders, the only senator in the Progressive Caucus.
Jayapal, Omar and other Progressive Caucus leaders met Tuesday with White House counselor Steve Ricchetti, legislative affairs director Louisa Terrell and Terrell's deputy Shuwanza Goff, a former top aide to House Majority Leader Steny H. Hoyer.
Yarmuth was scheduled to meet with progressives on Wednesday and also planned to meet with Blue Dog Democrats. “We need every vote, that’s all it is,” he said.
He added that Democrats are likely to assume some level of added debt in an eventual budget resolution. “There are very few members who expect this to be fully paid for,” Yarmuth told reporters. “I think everybody’s pretty realistic about that.”
House Democrats adopted rules for this Congress requiring all spending to be subject to a pay-as-you-go restriction, except for emergencies, including pandemic relief, or climate change legislation.
The climate exemption suggests that even among fiscal hawks on the Democratic side, there’s some room for maneuvering, but it’s unclear how much. Biden’s infrastructure plan assumes nearly $800 billion in climate-related spending.
Murphy said it was important to stick to the House’s pay-as-you-go rule and that there may be some wiggle room on the definition of climate-related spending, but not much. She said some infrastructure spending could be considered climate-related “if you shut one eye and squint the other.”
Hoyer, D-Md., told reporters Tuesday that additional deficit financing should be limited to guard against inflation.
“A legitimate concern is inflation, and we ought to make sure that we are active within the context of that,” Hoyer said. “The president has suggested paying for much of that additional spending, which we did not do in 2020 in dealing with COVID-19.”
House Democrats on Tuesday generally stressed they weren’t yet at the stage where they are comfortable talking numbers and price tags.
“We’re not concerned about topline, specific numbers,” said Rep. Pete Aguilar, D-Calif., the House Democratic Caucus vice chairman. “We’re really concerned about what’s in it and what that looks like and how we start to help our communities, help workers in our districts.”
Hoyer said he ultimately expects both wings of the party to come together on a compromise that allows for passage of Biden’s “physical” infrastructure proposals — roads, transit, rail, water, broadband and the like — and “human” infrastructure that’s left out of the Senate’s bipartisan plan.
“Are there different points of view, as you point out, among moderates, progressives, Blue Dogs, New Dems? There are a number of different views,” Hoyer said. “But I think we will come together in support of the president’s proposals that are incorporated in the jobs plan and in the family plan.”
House leaders, meanwhile, are doubling down on their strategy of holding up any bipartisan infrastructure bill that comes from the Senate until they also receive a reconciliation bill.
“I’d say we’re pretty united on that,” Yarmuth said of the linkage strategy. “I haven’t heard any pushback.”
However, a few House Democrats have publicly opposed the strategy. Murphy said Congress should pass the bipartisan deal “as soon as possible” and then devote “the time and thoughtfulness” that will be needed to negotiate a reconciliation bill.
Senate Minority Leader Mitch McConnell has also warned against any linkage of the two bills, suggesting such a move could derail prospects for a bipartisan package.
“The president cannot let congressional Democrats hold a bipartisan bill hostage over a separate and partisan process,” McConnell said in a statement Monday. The bipartisan plan negotiated with Biden calls for $579 billion in new infrastructure spending over five years.
Biden, who initially threatened not to sign a bipartisan plan if he didn’t also receive a reconciliation bill, issued a statement over the weekend saying he would support the bipartisan bill “without reservation or hesitation.”
But McConnell said Biden’s clarification would amount to a “hollow gesture” if congressional Democrats hold up the bipartisan bill.
Katherine Tully-McManus contributed to this report.