The sharp rise in inflation could pose a challenge to progressives pushing to enact a robust social spending and climate package.
The Labor Department reported Wednesday that the Consumer Price Index (CPI) rose 6.2 percent in the 12-month period ending in October, the largest increase since 1990.
The data quickly caught the Sen. Joe manchinJoe Manchin On The Money – Budget Analysts Caught in Partisan Shooting Nighttime Health Care – Presented by Rare Access Action Project – Biden Presents FDA Equilibrium / Sustainability Choice – Presented by Altria – Cotton Farm Accused of Laying Workers black MORE (DW.Va.), who has already raised concerns about the size and timing of the expense bill. Republicans are also highlighting the data in an effort to pressure moderate Democrats to oppose the legislation.
The concerns of moderates could make it difficult for progressives to include so many of their priorities in the spending package, known as the Build Back Better Act.
Progressives and key Democrats are countering inflation-related criticism by arguing that the measure could help address Americans’ concerns about the cost of goods and services.
Rep. Pramila JayapalPramila Jayapal Democrats disagree over SALT changes Legislators who opposed their parties on the infrastructure bill T House approves 1 billion infrastructure bills, advances social spending plan MORE (D-Wash.), Chairman of the Congressional Progressive Caucus, said Thursday that there are several aspects of the spending bill that would help lower costs for Americans, such as provisions to limit child care costs, provide pre-K universal and reduce the price of prescription drugs.
“Those are the things that will immediately hit people’s pockets, and that’s why it’s so important to pass the Better Rebuild Act, which I think will really help people survive in this time of recovery,” Jayapal said on MSNBC’s “MTP Daily”.
Democrats have been negotiating for months on the size and content of the spending package because every Senate Democrat and nearly every House Democrat will have to participate in order for it to pass.
Progressives have already had to compromise to satisfy moderates like Manchin. Progressives like Sen. Bernie sandersBernie SandersSanders backs Kaiser Permanente workers ahead of Monday’s strike Briahna Joy Gray: Biden ‘plays dumb’ with canceling student debt ‘Woke up’ discussion simmers for Democrats MORE (I-Vt.) Initially he wanted a package that included $ 6 trillion in spending and tax cuts, and Democrats then zeroed in on a $ 3.5 trillion figure on the top line. However, Manchin and the Democratic Senator from Arizona. Kyrsten CinemaKyrsten SinemaHillicon Valley – Immigrants are being put into surveillance programs Senate Democrats urge government to do more to protect K-12 schools from hackers Republicans find a message about race that works; Here’s how the Democrats should respond MORE He objected to the size of the bill and how it would be paid.
Then the White House came back with a $ 1.75 trillion framework for the legislation. Aside from the price cut, progressive priorities like the clean electricity standard and a Medicare dental benefit are unlikely to be included in the final package.
House progressives also recently dropped their insistence that the Build Back Better Act and a bipartisan infrastructure bill pass the House at the same time.
Earlier this month, progressives struck a deal with a group of moderate Democrats in the House of Representatives that paved the way for a vote on the “traditional” infrastructure bill in exchange for a compromise that moderates will vote for the social spending package when they receive more information about the cost of the bill from the Congressional Budget Office (CBO).
Despite concessions from Democrats in the new framework, Manchin has yet to endorse the spending bill. Has for months cited inflation as a reason to have a smaller package and for Congress to “pause” the action.
He amplified his concerns about inflation after Wednesday’s data was released.
“By all accounts, the threat that record inflation poses to the American people is not ‘transitory’ and is instead getting worse,” he said in a tweet. “From the grocery store to the gas station, Americans know that the inflation tax is real and DC can no longer ignore the economic pain Americans feel every day.”
Additional progressive priorities may be removed from the package or Manchin’s opposition could cripple his movement in the Senate.
“Of course, Manchin is going to use inflation (or whatever else he can point to) to make his case, but his concerns predate the spike in inflation and he has been hampering Biden’s agenda throughout,” Lindsay Owens said. , executive director of the Groundwork Collaborative, a progressive economic policy group.
Nonetheless, Jayapal was optimistic about the prospects for the Build Back Better Act during his interview with MSNBC.
He expressed confidence that House moderates would vote for the House bill once they received information from the CBO.
“Everyone has been talking about how important it is to our constituents,” he said.
Jayapal also said that most elements of the House bill have been “pre-conferred” with the Senate, and that the few remaining elements “should be the only ones left on the table.”
“We should approve it and hand it over to the American people,” he said.
One of those remaining elements is paid family leave, which the House has included in its version of the bill, but Manchin has indicated he will object.
Other progressive lawmakers have argued that the provisions of the social spending package will mitigate the impact of inflation and other financial challenges Americans face.
Before the publication of the latest inflation data, Rep. Alexandria Ocasio-CortezAlexandria Ocasio-Cortez Cheney and Kinzinger Say They Would Back Censorship of Gosar Nicolle Wallace Criticizes ‘Toxic Stew of Grievances’ Boosted in Conservative Media ‘Woke Up’ Discussion Simmer for Democrats MORE (DN.Y.) said that enacting the spending bill and the infrastructure bill is the “minimum” action Congress could take to tackle inflation.
“If you are concerned about inflation, it is important to understand why it is happening: complications in the supply chain, labor and healthcare. We can address these problems by investing in infrastructure, salaries, healthcare and benefits. ” she tweeted.
Rep. Don Beyer (D-Va.), Chairman of the Joint Economic Committee who is a member of both the Congressional Progressive Caucus and the more centrist Coalition of New Democrats, said in a statement to The Hill on Friday on the domestic agenda of Biden “It will help keep prices low by alleviating bottlenecks and increasing productivity and labor force participation, allowing us to build a strong, stable and widely shared economy. “
“I highly recommend that my colleagues who are concerned about inflation consider the many ways the Rebuild Better Act would help alleviate negative impacts on their constituents,” he said.
Progressives join the White House and Democratic leaders in Congress in arguing that the Build Back Better Act will help cut costs.
“The price increases are one more reason why we must act decisively to reduce the expenses that weigh the most on working families, from childcare to prescription drugs to housing, by passing the Build Back Better Act,” said Henry Connelly, spokesman for Speaker Nancy pelosiNancy Pelosi 12:30 pm Report from The Hill: Biden Elects Obama Official As FDA Chief Just Before Deadline Paid Family Leave Would Promote Gender Equality, But Details Matter Key Budget Office Stuck In see Biden’s spending plan MORE (D-Calif.).
Several progressive economic policy experts argue that the social spending package will not increase inflation, noting that spending on the bill would occur over several years and is expected to be paid for in full.
They also noted that Larry Summers, a former economic adviser to President ObamaBarack Hussein ObamaOvernight Health Care – Presented by Rare Access Action Project – Biden Reveals FDA Choice Washington Post Removes Large Portions of Two Stories on File Steele Manchin Opposes FDA-Nominated Biden MORE who has recently criticized the Biden White House, has said that the bill on social spending will not contribute to inflation.
“There’s really no good argument for the idea that Build Back Better would make inflation worse,” said Mike Konczal, director of macroeconomic analysis at the Roosevelt Institute.
“There are good arguments that rebuilding better, by helping with the supply capacity of the economy, by helping people to work longer and work better, could help deal with inflation and other supply constraints in the economy in the medium term. “.
Progressives also disagreed with Manchin’s inflation concerns and urged him to participate in the spending package.
“If Joe Manchin is really concerned about the money in people’s pockets and bank accounts in West Virginia, nothing could be better than child tax credit checks, helping with child care and creating millions of new jobs,” said Adam Green, co-founder of the Progressive Change Campaign Committee.