Paid leave, tax cut for the rich and more could be cut from Biden’s social policy bill

WASHINGTON — Congressional Democrats cheered on the floor of the U.S. House after approving President Joe Biden’s massive social spending and climate bill. 

But a major struggle lies ahead in the coming month in the U.S. Senate, where Democrats cannot lose any votes within their party if they are to send the so-called Build Back Better measure to Biden’s desk. 

That gives any individual Democratic senator virtual veto power over the bill — and some are already declaring what they won’t accept.

The Congressional Budget Office has estimated the bill would spend about $1.7 trillion over 10 years. Budget analysts project another roughly $500 billion in tax breaks, putting the total cost at about $2.2 trillion over a decade, higher than earlier estimates from the White House.

The measure already has been the subject of months of negotiations, intended to make peace between moderates skeptical of the legislation’s price tag and progressives who are frustrated that it doesn’t go further in addressing longstanding problems with child care, health care, immigration and other policies. 

Any changes made in the Senate will mean the bill must return to the House for another vote before it could be signed into law — and its cost will increase or decrease as well. And time is running short, with the number of session days dwindling as the end of the year approaches.

Here’s more on the proposals in the House bill that are most likely to disappear once the Senate gets to work:

Paid leave

Biden’s initial proposal called for 12 weeks of paid leave for parents and other caregivers who need to take time away from work to take care of a new baby or another family member, or to recover from an illness. 

That new benefit was scaled back to four weeks, then removed from the bill entirely — before four weeks of paid leave was added back into the final House version. 

But paid leave, which is popular among Americans, faces significant opposition from Sen. Joe Manchin III, (D-W.Va.), who has said for weeks that he does not support including a new national paid leave program in the bill.

Manchin has said he doesn’t believe that such a program should be created through the reconciliation process, which is what the evenly divided Senate will use to pass the legislation by simple majority. 

He’s also said he prefers a paid leave program that’s funded by contributions from both employers and employees, and Manchin has expressed concerns about the solvency of a new benefit program.

“To expand social programs when you have trust funds that aren’t solvent, that are going insolvent — I can’t explain that, it doesn’t make sense to me,” Manchin said, according to The Washington Post.

Under the House-passed bill, the paid leave program would start in 2024, and would be available to most employed or self-employed workers. 

Money would be paid out either through a new federal benefit or through existing state or employer-based leave plans, and those non-federal leave programs would receive some reimbursement from the federal government.

The U.S. is one of only a few countries in the world — and the only wealthy country — that does not have a national paid family leave program. 

The four-week benefit in the House-passed bill also is far shorter than what most nations provide, and less than the 12 weeks of unpaid job protection offered to some workers under the Family and Medical Leave Act.

Cap on SALT deductions

Senate Democrats across the ideological spectrum oppose a provision in the House bill they consider a tax break for wealthy residents of high-tax states. The measure would lift a cap on the federal deduction people can take for state and local taxes, commonly called the SALT deduction. 

The provision was the biggest reason for moderate Maine Democratic Rep. Jared Golden’s vote against the bill in the House, but also needed to win the votes of members like Rep. Josh Gottheimer of New Jersey.

Sen. Bernie Sanders, a Democratic Socialist from Vermont who caucuses with Democrats, has railed against the “hypocrisy” of Democrats providing tax breaks to the wealthy.

It’s not only Sanders’ wing of the Democratic caucus that opposes the measure. Sen. Michael Bennet, (D-Colo.), noted in a tweet last week that 70% of the SALT benefits would go to the wealthiest 5% of the population.

“The American people didn’t send us to Washington to cut taxes for rich people,” he tweeted.

But with Senate Democrats led by New Yorker Chuck Schumer — who has many constituents who would benefit from the tax break — the provision may not be completely scrapped, even with members from Sanders to Montana moderate Sen. Jon Tester opposed. Instead, a compromise may emerge, those close to the process in the Senate say. 

Sanders and Sen. Robert Menendez, (D-N.J.), are working on language that would limit the new deduction cap to those making more than $400,000 per year. 

Immigration

An immigration proposal House Democrats wrote into the bill is in danger more from the Senate’s nonpartisan parliamentarian than opposition from Democratic senators.

The measure would allow people in the United States in violation of immigration laws to retain work permits and be safe from deportation for five years.

Immigration activists had sought more permanent relief, which was included in an earlier draft of the bill that the parliamentarian, Elizabeth MacDonough, rejected in September.

Because Democrats are moving the entire package through reconciliation, it must comply with a rule for that process prohibiting provisions that have little impact on the federal budget.

Methane fee

Manchin has reportedly objected to the piece of the bill that would impose a new fee on methane emissions from fossil fuel production.

The proposal would ramp up fees, from $900 per metric ton in 2023 to $1,500 per metric ton in 2025. 

Methane is among the most potent greenhouse gases that lead to climate change. Biden and other world leaders pledged at the United Nations climate conference earlier this month to reduce methane emissions by 30% by the end of the decade.

Manchin, whose family has ties to West Virginia’s coal industry, is often out of line with his fellow Democrats on energy issues. 

Under pressure from Manchin, the White House dropped another major climate proposal in an earlier version of the bill. That measure would have created a program to reward utilities for reaching clean energy goals and punish those that don’t.

A spokeswoman for Manchin declined to comment.

Already out: Gold-mining royalty

Before the bill even reached the Senate, the House removed a section adding a federal royalty rate for miners of gold and other hard rock minerals. Sen. Catherine Cortez Masto, (D-Nev.), took credit for getting rid of the measure that would mostly affect gold producers in her state.

Hard rock miners operate on federal lands under an 1872 law that shields them from paying the kind of royalties levied on the oil, gas and coal industries. 

The House proposal, authored by Natural Resources Committee Chairman Raul Grijalva, (D-Ariz.), would have imposed an 8% royalty rate on new mines and a 4% rate on existing operations, affecting about $5 billion to $7 billion per year. 

Environmentalists and fiscal hawks have long sought a royalty rate for hard rock mining, but Cortez Masto objected to the disproportionate effect it would have on Nevada.

A spokesperson for her office called the initial proposal “a nonstarter” for Nevada’s senior senator, adding “Cortez Masto ensured that the House’s original provision was not included in the legislation that just passed the House.”