How Biden walked a political tightrope to pass $1.9tn stimulus

On March 2, Democratic senators were assembled on their private weekly Zoom lunch call, chatting and eating, when Joe Biden dialled in with his camera turned off. The 78-year-old president opened with a plea, according to lawmakers on the call: his congressional allies must not waver on his $1.9tn stimulus package, which was headed for a series of critical votes in the upper chamber later that week.

“His message was: ‘this bill is going to make a huge difference in the lives of Americans and we have to get it done. There’s urgency to getting it done’,” said Tina Smith, a Democratic senator from Minnesota, who attended on her iPad. “‘And it’s not perfect, nothing is perfect, but we can’t have the perfect be the enemy of the good’,” the president conveyed to the caucus, Smith added.

Nine days later, Biden achieved the top legislative priority that he set out upon entering the Oval Office on January 20. The House of Representatives on Wednesday gave Congress’s final green light to a massive spending package to jolt America’s recovery from the pandemic recession with large-scale government transfers to low and middle-class households including direct payments of $1,400 for most individuals.

But reaching that point involved one of the most delicate missions in US politics. With exceedingly thin majorities in both the House and the Senate, and unified Republican opposition, Biden had to avoid defections within his own ranks to secure the deal.

This meant balancing the desires of conservative Democrats from swing states, who wanted to trim the size of the package, with those of progressive lawmakers desperate for the boldest possible action after four years of Donald Trump in the White House.

The result will allow Biden to turbocharge America’s economic recovery with a massive expansion of government spending that he hopes will create momentum for his budding presidency.

It also cements Biden’s reputation — derived from his three-decades long Senate career and two terms as vice-president — for effectively managing relationships on Capitol Hill along with Nancy Pelosi and Chuck Schumer, the Democratic leaders in the House and Senate.

But the twists and turns along the way — and Biden’s failure to convince even one Republican member of Congress to support the bill — point to potential pitfalls ahead as the president attempts to forge ahead with the rest of his agenda, including a multitrillion dollar infrastructure package.

Democrats credit Biden’s low key approach, which involved behind the scenes interventions targeted at individual lawmakers rather than a heavy-handed public pressure campaign, with holding the party together.

“He was able to deliver something enormous at a moment of need, that people can easily understand, it doesn’t get better than that,” said Scott Mulhauser, a former Democratic congressional staffer at BPI, a consultancy in Washington.

The Georgia elections that changed everything

Biden’s dream of passing such a large stimulus came to fruition in polling stations of Georgia on January 5, when Democrats unexpectedly won two run-off races that gave his party control of the Senate by the narrowest of margins.

Nine days later, with Trump still in office and America reeling from the attacks on the Capitol, Biden made his way to The Queen, a theatre in his hometown of Wilmington, Delaware, to unveil his plan. “A crisis of deep human suffering is in plain sight, and there’s no time to waste,” Biden said. “We have to act, and we have to act now.”

The US president initially held talks with moderate Republicans, reflecting his predisposition for bipartisanship and his inauguration day call for unity in a divided and demoralised country.

A counterproposal from Republicans led by Susan Collins resulted in a meeting with Joe Biden in the White House. But their opening offer of a $600bn package was dismissed as too small © AP

But when Susan Collins, the moderate Maine Republican senator, and a few of her colleagues, presented a counterproposal worth about $600bn, it was quickly dismissed as underwhelming by the US president and his staff. People close to the negotiations said that if the opening Republican offer had been higher, at least closer to $1tn, it might have resulted in more serious talks.

The lowball offer convinced Biden to plough ahead with a plan that relied solely on Democratic support. A big factor in that decision was his memory of the financial crisis, when Barack Obama spent months in vain seeking Republican support for his signature healthcare reform.

“[Biden] knew he had to think big, he knew that he had this progressive bill that he needed to get passed, and he could have wasted weeks and weeks and weeks,” said Smith, the senator from Minnesota.

“I think there was some flexibility with some Republicans to go a bit higher but it became pretty evident that the bipartisan approach was not going to happen,” added Mark Warner, the Democratic senator from Virginia.

Republicans struggle to mount an opposition

In early February, Biden’s effort to push a relief package through the upper chamber was threatened by Trump’s second impeachment trial in the Senate on a charge of inciting the deadly January 6 attack on the US Capitol. But the proceedings wrapped up within days, Trump was acquitted, and the stimulus was back on track.

By that point, the biggest task was securing unanimity among Democrats, given the 50-50 split in the Senate, with vice-president Kamala Harris casting any tiebreaking votes and a tiny edge for Biden’s party in the House.

One setback came early in the month when Lawrence Summers, the former US treasury secretary under Bill Clinton, published an op-ed in the Washington Post warning that the stimulus was so large that it might trigger unwanted inflationary pressures.

The White House quickly rebutted the argument and, on Capitol Hill, the Summers intervention ended up being more of a talking point than a game changer.

Meghan Pennington, a former Senate Democratic aide now at Hamilton Place Strategies, a consultancy, said the Summers article was interpreted more as flagging risks rather than judging the stimulus as a mistake, and lawmakers’ reactions were along the lines of: “He’s a smart guy and this is an interesting piece to read but it’s not gonna make me doubt or change my mind”.

Warner said that by then the desire among Democrats to go big had been embraced by most of the party.

“In any large package it’s hard to defend every last component,” Warner said. “But there was this general sense that in the 2008-09 crisis we maybe undershot, so if you’re going to do something overshoot — because otherwise the recovery will take much longer.”

The White House’s campaign to keep the Democratic ranks onside was boosted by poll after poll showing the legislation was overwhelmingly popular — especially among Democrats — making it hard for the party’s lawmakers to oppose it.

Meanwhile, Republicans struggled to make an effective case against the bill, instead mounting a halfhearted and confused opposition. Their ability to resurrect a well-trodden argument — that the stimulus would add to the deficit and saddle a generation with debt — was complicated by the fact that their reputation for fiscal rectitude took a hit after they approved Trump’s $1.7tn tax cuts. And some Republicans had already embraced more direct cheques to Americans.

In the absence of a credible case against the relief package, some Republican lawmakers focused instead on cultural issues, like the decision by Dr Seuss Enterprises to stop publishing some of his books on the grounds that they were “hurtful” to people of colour.

“Republicans ceded the universe here,” said Mulhauser, the BPI consultant. “By focusing on Dr Seuss, and election conspiracy theories, they’ve not only seen tremendously important policy move forward, they’ve had no voice.”

Joe Manchin throws a spanner in the works

By late February, the House had passed its bill and sent it for consideration in the Senate, where it was debated and voted on over several chaotic days last week.

Last Monday, the day before he made his final pitch to all Senate Democrats, Biden convened a private conference call with eight party moderates who had some concerns about the size of the package.

“He made the case that the country needs this help,” Warner said. “And it was terribly important for his administration [to get] off on the right foot.”

Over the course of the week, Biden conceded to some of the moderate Democrats’ demands. Warner secured a reallocation of funding for state and local governments for use in broadband expansion, while the White House also agreed to quickly phase out eligibility for the $1,400 cheques above incomes of $75,000 per year.

But the biggest hurdle was Joe Manchin, the moderate Democratic senator from West Virginia, who held up the bill in the upper chamber of Congress for hours on Friday to secure changes to the unemployment benefit provisions.

Biden had to call Manchin directly to reach an arrangement and make sure he did not defect. Manchin told Fox News on Tuesday that Biden was “very straightforward” during their conversation.

“I know exactly where he’s coming from. He knows where I’m coming from. And the thing I appreciate most, he says: ‘Joe . . . I never asked you to go against your convictions,’” Manchin said.

Once the Manchin impasse was resolved, Biden could rest easy, but the senators stayed up all night to vote on amendments to the legislation, a process that was forced by Republicans. At about 3am, tired and hungry Democratic lawmakers put in a huge takeout order for chicken nuggets, french fries and hamburgers — and gorged themselves.

“It tasted really good at 3.30 or 4 in the morning but by 6 a lot of us were going ‘I can’t believe we ate that much’.”

Despite some indigestion, the mood among members of Biden’s party was one of celebration. “It’s the best thing . . . we’ve done in the Senate in my career,” Sherrod Brown, the Ohio Democrat, told CNN.

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