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Biden presses ahead with stimulus despite Republican opposition

Joe Biden and congressional Democrats are barrelling ahead with plans to pass a $1.9tn economic relief plan without significant support from Republican lawmakers, threatening to ditch the bipartisanship pledged by the new administration.

Since taking office two weeks ago, Mr Biden’s top legislative priority has been to enact his sweeping fiscal stimulus plan to prop up the US economy as it struggles through the coronavirus pandemic.

But it has quickly presented the new president with the dilemma of passing a larger plan backed by Democrats or a watered-down version that garnered some Republican support and would fulfil his frequent calls for greater unity in American politics.

Mr Biden met with a group of moderate Republican senators on Monday who floated their own $600bn stimulus plan in an attempt at compromise, but the White House and many Democrats quickly dismissed the rival plan as insufficient.

By Wednesday, he was huddled with Democratic lawmakers in the House and the Senate, where the party holds narrow majorities, to discuss ways to pass the legislation without Republican votes.

“Their preference is for bipartisanship, speed, and force. But speed and force are not up for negotiation,” said Gene Sperling, the former senior economic adviser to previous Democratic presidents Bill Clinton and Barack Obama.

One of the reasons that the Biden administration has so quickly moved away from a bipartisan agreement in Congress is the memory of Mr Obama’s first term in office, when he spent much time and political capital trying, in vain, to secure Republican support for his healthcare overhaul and additional stimulus measures.

“I think there’s a very clear memory of Republicans not negotiating in good faith and just trying to drag their feet when they’re never going to actually get to a yes,” said Josh Schwerin, a Democratic strategist and president of Saratoga Strategies, a consultancy.

He added: “It’s in Biden’s nature to want to come to a compromise, to want to work together, and he did give them that opportunity. If they’re not going to take it, then we don’t need to learn that lesson again.”

Some Republican lawmakers have in recent days suggested that Mr Biden was more willing to engage with his political opponents on the stimulus bill than with his staff, who were nudging him to take a more hardline stance. But Jen Psaki, White House press secretary, on Wednesday dismissed such suggestions as “ludicrous”.

“There is no one who’s going to tell him what to do or hold him back,” she said. During the same briefing, Ms Psaki also listed the ways in which Mr Biden’s plan would be more helpful to American families compared with the Republicans’ proposal, highlighting the extent of the distance between the two sides.

One area where Mr Biden and his administration have suggested they are willing to compromise is over the $1,400 cheque they are proposing to give directly to most Americans. Whereas previous stimulus rounds set the bar for full payments at $75,000 per year in income, that is now likely to be reduced to $50,000, which will reduce the overall pricetag of the stimulus bill.

This will help ensure support for the plan from moderate Democrats who have expressed some scepticism about the size of the package, including senator Joe Manchin of West Virginia.

The White House is trying to secure support for its stimulus plan from moderate Democrats including senator Joe Manchin of West Virginia, centre © Bloomberg

Mr Biden’s inclination to move ahead without Republican support for the stimulus plan partly reflects confidence within the White House and among Democrats that public opinion is in favour of the rescue package.

According to a Quinnipiac University poll released on Wednesday, Mr Biden’s plan is backed by 68 per cent of Americans, including 37 per cent of Republicans, while the $1,400 cheques are supported by 78 per cent of Americans and 64 per cent of Republicans.

“Over and over again, I’ve heard from Coloradans — Republican and Democrat — that this is the worst public health and economic crisis they have ever experienced and that Congress needs to act immediately to address it,” Michael Bennet, Democratic senator from Colorado, said in a statement to the Financial Times.

“We should remain open to good ideas from anyone about how to strengthen the package, but we cannot delay or limit what we are doing for arbitrary political reasons,” he added.

The economic consensus around the addition of public debt has also changed dramatically since the financial crisis, with barely any Democrats making the case for fiscal restraint at this stage in the recovery.

“It’s hard to find somebody who says the prudent thing to do is to be stingy with money,” said Andres Vinelli, vice-president for economic policy at the Center for American Progress, a left-leaning think-tank.

Mr Sperling added: “With all the nuances and complexities, it comes down to an overall lesson that you go big and bold enough, not just to encourage recovery, but to get all the way to full employment.”


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