Some Democrats are balking at suggestions by the White House that they may have to drop their bid to revive their signature Child Tax Credit plan.
One day after President Joe Biden appeared ready to concede it may fall by the wayside, some lawmakers said they are not giving up on the proposal, which is included in a sweeping spending package stalled in the Senate.
“I certainly am not ready to throw in the towel,” said House Ways and Means Chair Richard Neal (D-Mass.).
Sen. Finance Chair Ron Wyden (D-Ore.) said “we’re gonna fight like hell for it.”
Their comments came in wake of a press conference Wednesday in which Biden said the credit is one of the “really big components that I feel strongly about that I’m not sure I can get in the package.”
In a pair of subsequent television interviews, Brian Deese, a top economic aide to Biden, cited other priorities he said Democrats could rally around, while conspicuously omitting the child credit.
The dispute comes as Democrats took a break from tense negotiations over the package to focus on voting rights.
Their expansion of the credit was a centerpiece of the plan, with Democrats proudly citing studies showing the initiative had slashed childhood poverty.
As part of a stimulus package last year, Democrats had increased the maximum credit to $3,600 per child, from $2,000; dramatically increased aid to the very poorest by dumping long-standing work rules associated with the break; and transformed the credit into a monthly payment program that sent 35 million families a portion of the credit each month.
Those provisions expired at the end of 2021, with Democrats now anxious to renew them.
“I’m committed to getting the expansion done — no matter what it takes,” said Sen. Sherrod Brown (D-Ohio).
Sen. Joe Manchin has infuriated many of his colleagues with a series of objections to the beefed up credit.
At the same time, the West Virginia Democrat has said he could support other parts of the reconciliation package such as a phalanx of tax subsidies for renewable energy, which has some Democrats rethinking their priorities.
In interviews Thursday morning with CNN and Bloomberg Television, Deese, the director of the National Economic Council, said lawmakers could rally around those credits. He also pointed to provisions designed to reduce health care and prescription drug costs, as well as proposed limits on how much parents spend on child care, as areas of agreement.
“Those are things that I think are practical, would address [family] costs and are doable,” he told Bloomberg.
Sen. Ed Markey (D-Mass.) signaled he’s ready to follow Biden’s lead.
“The climate and clean energy provisions in Build Back Better have been largely worked through and financed, so let’s start there an add any of the other important provisions to support working families that can meet the 50-vote threshold” in the Senate, he said.
Manchin has three main objections to Democrats’ child credit plans: that his colleagues are hiding the proposal’s true cost by only proposing a one-year extension of the break; that Democrats ended rules requiring recipients to work; and that the break goes to families too far up the income ladder, earning up to $400,000.
Some lawmakers such as Sen. Michael Bennet (D-Colo.) would like to target the break more squarely at people with average incomes, though that would run afoul of Biden’s promise not to raise taxes on people making less than $400,000.
It’s actually become easier to potentially address Manchin’s concerns regarding the work requirements now that Democrats’ expansion has expired.
That’s because old rules requiring child tax recipients to have income in order to take the break are back on the books as of Jan. 1. So rather than Democrats having to take an uncomfortable vote to fully restore the requirements, they could potentially come up with a compromise that would satisfy Manchin, who has not said publicly what he’d like the work rules to look like.
Neal said he’s ready to compromise, while declining to get into specifics.
“I’m open to some discussions about it” and there’s “room here to negotiate,” he said.
“I don’t understand why we can’t find an accommodation — which I think we will.”