Although negotiations are expected to continue, this deadlock marks the most obvious sign to date that despite leadership efforts to approve the bill before Christmas, Democrats will still be forced to postpone the Senate vote until at least 2022.
A source familiar with the conversation told CNN that the negotiation between Manchin and Biden on the bill was called “better reconstruction” and “far apart.” Given the state of the talks between the influential moderate senator and the president, sources familiar with the matter said that Chuck Schumer, the leader of the Senate Majority Party, is very likely to postpone the bill until 2022. .
Manchin did not deny that he wanted to exclude the extended version of the tax credit. Although he told reporters that he “always” supported the children’s tax credit itself, he would not comment when asked if he wanted to remove it from the package currently being negotiated.
According to multiple sources, Manchin suggested that Biden pass the tax credit extension on a separate track-Democrats believe this is impossible because it requires at least 10 Republican votes to get it outside of the current budget process. progress.
But the source pointed out that it is impossible for Biden to cut child tax credits. This has been the core issue of the differences, although there have been several other unresolved issues in the discussions between the two in the past few days.
Why Manchin is worried about children’s tax credits
According to a source familiar with the matter, Manchin is worried about leaving the child tax credit in the “Rebuild Better” bill, which has to do with how it affects the overall cost of legislation.
The source said that Manchin did not explicitly tell Biden to cancel any specific policies, but he made it clear that these expensive terms are not suitable for keeping the bill at $1.75 trillion.
Manchin’s belief is that if credit is expanded for more than 10 years, billing costs will skyrocket.
The President’s framework will extend credit for another year, affecting more than 35 million Americans whose annual income does not exceed $35,000.
But Manchin said that the temporary plan does not reflect the true cost of taxpayers.
How the child tax credit works
The full credit is applicable to household heads whose annual income does not exceed US$112,500 and joint filers whose annual income does not exceed US$150,000, and will be phased out since then.
It is worth noting that the credit is designed to be paid on a monthly basis, with the government paying up to US$300 per month for each child under 6 years old and up to US$250 per month for children 6-17 years old.
The expanded credit-and monthly payments that significantly reduce child poverty throughout the year-will expire this month.
Biden and Manchin’s disagreement over tax credits highlights the complexity and fragility of the negotiations, as the Democratic Party is trying to pass social safety net legislation, which is the president’s primary task and the core of the domestic agenda.
Manchin’s support for the bill was critical to its passage, but he expressed his main concerns about its costs and pushed for the reduction of the overall legislation. This poses a major challenge for Biden. He must find a way to win the support of West Virginia Democrats without cutting too many key priorities or alienating liberal Democrats who also need votes. .
Senate Democrats need all 50 members of their caucus to vote for the legislation in order to pass it through a process called reconciliation, which will allow it to be approved without Republican support.
Democrats oppose the possibility of cutting child tax credits
On Wednesday, the news that Manchin hoped to cancel the funding of the child tax credit in the “Rebuild Better” bill quickly sparked strong opposition from other Senate Democrats.
“It will not be zeroed,” Ohio Democratic Senator Sherrod Brown said. “There is no room for negotiation.”
Senator Elizabeth Warren, Democrat of Massachusetts, said: “We need a child tax credit. It has reduced child poverty in the United States by nearly half.”
Democratic Senator Michael Bennet from Colorado tweeted: “The last thing we should do is increase taxes on working people. The last thing we should do is double childhood poverty. We should do it. The last thing is to increase the child hunger rate in this country.”
Biden faces the challenge of winning Manchin
Although Biden is fully aware that the bill must be changed to gain Manchin’s support, and he is willing to do a lot to get Manchin’s support, the dramatic changes in the child tax credit are one of the few areas that White House officials know about. Red lines for other Democrats.
Although White House officials have described these calls as positive and fruitful in the past few days, they have emphasized how much work remains to be done to ensure Manchin’s vote.
“We believe that the senator wants what we want, and that is to serve the American people,” White House Chief Deputy Press Secretary Karin Jean-Pierre told reporters on Air Force One on Wednesday that Biden went to Kentucky to investigate Tornado-the state of being ravaged.
The source made it clear that the dialogue will continue. Missing the Christmas deadline does not mean that the bill itself has expired. White House officials have been studying several different options to present to Manchin what they believe is an effort to solve the problem.
But for now, any near-term solution seems unlikely.
Manchin said “There is nothing to vote”
When asked if Build Back Better could pass before Christmas, he said. “We didn’t even get any return from the MPs, so as far as the procedure is concerned, we have nothing to vote.”
When asked if he would talk to Biden again on Wednesday, Manchin did not answer, or whether they agreed on the true cost of the bill.
Schumer has been putting pressure on the Democrats to complete the “rebuild better”, but it is worth noting that on Wednesday he did not talk about his set Christmas like most of his speeches in the Senate and press conferences. deadline.
Schumer said: “This week, Democrats continue to work hard to put the Senate in a position where we can vote on the president’s “rebuild better” legislation.
CNN’s Morgan Rimmer, Ali Zaslav, Ted Barrett, and Tami Luhby contributed to this report.
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