With the details still in flux, members of Congress spend the final hours before the Wednesday night address making sure their priorities are taken into account.
WASHINGTON – Ahead of President Joe Biden’s address to Congress on Wednesday, lawmakers are stepping up efforts to ensure that top priorities move into the next phase of its massive infrastructure reinvestment program, the American Families Plan.
Biden is expected to unveil portions of the proposal this week that focus on what’s called human infrastructure – childcare, health care, education, and other core aspects of the household architecture that shape the daily lives of countless Americans. It would be paid for through tax increases for very high income households, in line with the president’s promise not to impose taxes on households earning less than $ 400,000 a year.
With the details of the plan still in flux, Democratic members of the Congress tasked with driving the legislation through will spend the final hours leading up to Wednesday night’s address putting their priorities into the final package of over $ 1 trillion.
House spokeswoman Nancy Pelosi has made it clear that she wants to cut the cost of prescription drugs as well as the cost of getting health insurance under the Affordable Care Act.
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Progressives, led by Vermont Senator Bernie Sanders, insist on lowering the Medicare Eligibility Age, which is now set at 65, and expanding the Medicare benefits to include access to dental, visual and hearing aids for seniors.
A group of leading centrist and progressive Democrats will meet with the White House on Tuesday to discuss their priority of making the child tax credit permanent, which has been increased up to $ 300 per month as part of a COVID-19 relief package. Currently, that benefit expires in 2022, and Biden has proposed extending it through 2025.
“We’re pushing ahead,” said Senator Sherrod Brown, D-Ohio, chairman of the banking committee and advocate of permanent tax credits for children, late Monday night. “We are hopeful. We want it to be permanent because it is so important to so many people’s lives. “
The President’s speech and the introduction of the American Family Plan come as Biden marks his first 100 days at the White House, a unique moment for Congressional action. Democrats tightly control the House and Senate, giving full power to the President’s party for the first time in a decade.
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While Biden is determined to advocate bipartisanism, Republicans in Congress have largely viewed his proposals as large government spending to speak out against. Biden’s Democratic allies in Congress are equally determined to ensure that they use this rare alignment of political power to achieve long-awaited priorities.
At her last weekly press conference, Pelosi telegraphed her priorities to the White House.
“Lowering health care costs and lowering prescription drug prices will be a top priority for House Democrats to be included in the American family plan,” she said.
Administrative officials said Monday that details of the proposal are still to be finalized. However, the package builds on Biden’s proposed US $ 2.3 trillion employment plan, a massive investment in infrastructure that goes beyond roads and bridges to include veterans hospitals, daycare and other developments.
The White House has portrayed its plan as a Robin Hood-style effort to tax the rich in order to spend on benefits for the middle class and the poor.
It is an argument that the hundreds of billions of dollars controlled by the richest splinter in the country would produce better results for the country if they were instead distributed to families.
The proposal would extend an expanded child tax credit through 2025 and allow parents to make monthly payments of at least $ 250 per child. It would offer free community college and paid family vacations, among other things.
Funding the initiative would be a tax hike for the extremely rich, in particular a nearly doubling of the tax rate on investment income on incomes over $ 1 million to 39.6%.
Similarly, the highest income tax bracket for households earning more than $ 400,000 is expected to decline to 39.6%, according to a Democratic adviser who was granted anonymity to discuss the planning. This was the maximum rate prior to the 2017 GOP tax overhaul approved by Donald Trump.
Initial reports of a capital gains tax hike sparked a sell-off in the stock markets last week. But Brian Deese, director of the White House’s National Economic Council, tried Monday to reassure voters by saying only a fraction of the country would pay more.
Speaking at a White House briefing, Deese said that only the top 0.3% of taxpayers owe more. For every 1,000 taxpayers, that means three would be subject to the higher tax on capital gains – which reflect the gains from the sale of an asset like a stock or a home.
With capital gains now taxed at a maximum rate of 20%, wealthier individuals who earn most of their income through the financial markets can often pay a lower tax rate than those who consider themselves middle class and live on their salaries.
“We believe that not only is this fair, but it would also help reduce the type of tax avoidance that significantly undermines trust and fairness in tax law itself,” Deese said. “The proceeds from this provision would help invest directly in our children and families, as well as in our future economic competitiveness.”
Republican leaders have said they are unwilling to overturn the 2017 tax bill, their signed Trump presidency acquisition, to pay for what they see as high Democratic spending.
No Republicans voted for Biden’s coronavirus bailout plan, which was signed into law last month. Last week, Republican senators proposed an alternative infrastructure plan that focused on more traditional highway and bridge investments and would account for a quarter of the cost that would be paid through tolls and other usage charges.