On Monday, President Joe Biden met with 10 Republican US senators at the White House to discuss a roughly $618 billion recovery package they introduced to address the economic and health challenges created by Covid-19. The meeting should be one of many Biden has to make good on his campaign promise to work across the aisle and find a solution that can garner significant bipartisan support. A failure to do so risks not only eroding whatever goodwill he may have built with the calls for unity in his inaugural address, but also his opportunity to secure other bipartisan wins as his time in office goes on.
At the same time, congressional Democrats are moving ahead with an effort to force through relief legislation without Republican support and on a strict party-line vote. Practically speaking, there are policy, political and procedural reasons for Biden to shun this approach and instead to work with the Republican senators to finalize a recovery package this week.
First, while the Republican proposal is substantially smaller than Biden’s initial bid of $1.9 trillion, it focuses on many of the key areas where additional government action would be helpful. Biden’s proposal costs massively more, in no small part because it offers more direct stimulus payments to individuals and doles out another $350 billion in aid to state and local governments. All of Biden’s proposed spending comes on top of the $4 trillion that Congress has already authorized to help America recover from the pandemic.
The GOP framework includes $160 billion in funding for direct Covid-19 response, including money to accelerate vaccine distribution, scale-up testing and provide financial assistance to beleaguered health care providers. It also includes a three-month extension of enhanced unemployment insurance benefits (which are scheduled to expire in March without further action), assistance for schools and small businesses, and an additional $1,000 in direct stimulus payments to families making less than $100,000 per year.
Recent economic data makes the case for more targeted relief. For example, estimates released on Monday by the Congressional Budget Office show the economy is already well on its way toward recovery. CBO concluded that the US economy is estimated to expand rapidly over the next year, growing at a robust 4.6% in 2021 and almost 3% in 2022.
Unemployment is slowly but steadily declining and the size of the civilian labor market should be in 2022 what it was before the pandemic. The size of the “output gap,” or difference between what the economy will produce over the next few years and what it could produce at full potential, suggests that a more modest intervention — something of the magnitude that the GOP package proposes — will fully address the short-term economic challenges we face.
Separately, a number of states have reported revenues that are running ahead of expectations, easing the need for significant additional aid to states. California, for example, is expecting record revenues despite the economic shutdowns in reaction to the Covid-19 pandemic. While some states are still facing budget shortfalls, the fiscal impacts of the pandemic aren’t as bad as feared, or nearly as significant as they faced in previous economic slowdowns.
Politically, the benefits to working with Republicans — especially the group of 10 who stepped forward to advance this proposal — far outweigh the potential blowback that Biden may get from progressives who want him to “go big” with this relief package. These Republican senators (particularly Mitt Romney of Utah, Susan Collins of Maine and Lisa Murkowski of Alaska) hold the key to possible bipartisan agreements on other elements of Biden’s legislative agenda, in areas as diverse as health care, infrastructure and immigration reform.
Unless Democrats agree to abolish the legislative filibuster, which seems unlikely given West Virginia Sen. Joe Manchin and Arizona Sen. Kyrsten Sinema‘s opposition, Biden will still need significant bipartisan support to get the 60 votes he needs to move legislation to a final vote in the Senate. And he will only be able to use budget reconciliation — a legislative process that would allow him to enact policy changes that have a substantial relationship to government revenue or spending via a simple majority vote — twice, at most, during his first year in office. (This is because reconciliation packages must be tied to approved congressional budget resolutions. Congress has yet to pass a budget resolution for the current fiscal year and then could pass a second budget ahead for the new fiscal year, which begins on October 1.)
There’s also no guarantee that even if Biden wanted to use a strictly partisan approach to advance a larger package, he’d be able to maintain the unanimous support of Democrats in the Senate to do so. Some moderate Democrats, like Sen. Joe Manchin of West Virginia, have been irked by efforts to ram through relief legislation on a partisan vote (even though Manchin has now agreed to vote in favor of the budget process). Others have also expressed misgivings about the Biden proposal, which would make advancing the package with votes from his party alone a challenge.
Finally, there are procedural reasons that Biden should work with Senate Republicans to get a relief package passed as soon as possible. Starting next week, Biden’s ability to find common ground will be inhibited by the start of the Senate impeachment trial of former President Donald Trump. Despite the Biden administration calls for the Senate to “walk and chew gum” at the same time, it will be extraordinarily difficult to negotiate an agreement on a major spending bill while a divisive impeachment proceeding is playing out on the Senate floor.
If Biden is truly interested in advancing more substantial reforms, he will have the opportunity to do that through the budget reconciliation process. There are proposals in his package sure to get minimal, if any GOP support — significantly enhanced funding for state and local governments or a hike in the minimum wage, for example. These are the sorts of things Biden would have greater success pursuing through reconciliation when the time comes for that later this year.
For now, Republicans are offering Biden the opportunity to get some valuable policymaking done to address the health and economic challenges that are most urgent. He should seize this opportunity.