Biden vows to use executive action after Manchin torpedoes climate agenda

By Betsy Klein, Ella Nilsen, Manu Raju and Morgan Rimmer, CNN

President Joe Biden vowed Friday to take “strong executive action” in response to moderate Democratic Sen. Joe Manchin torpedoing his party’s efforts toward writing sweeping climate action and tax legislation.

“If the Senate will not move to tackle the climate crisis and strengthen our domestic clean energy industry, I will take strong executive action to meet this moment,” Biden said in statement, while overseas in Jeddah, Saudi Arabia. Biden didn’t mention Manchin specifically.

The President vowed to “create jobs, improve our energy security, bolster domestic manufacturing and supply chains, protect us from oil and gas price hikes in the future, and address climate change,” but did not provide specifics on what kind of action he would take.

On Thursday night, Manchin dealt a devastating blow to Democrats’ hopes for sweeping legislative action this year, telling Senate Majority Leader Chuck Schumer and his staff “unequivocally” that he won’t support the climate or tax provisions of a Democratic economic package, two sources familiar with the talks told CNN.

Manchin and Schumer had been negotiating for months, and the New York Democrat had made a number of concessions to pare back the climate provisions to appease the West Virginia moderate, whose support is critical in an evenly decided Senate.

In a Friday radio interview, Manchin disputed the characterization that he had blown up the negotiations with Schumer but said that he asked that they wait until the July inflation numbers came out and pursue this after August recess.

“I said, ‘Chuck until we see the July inflation figures, until we see the July, basically Federal Reserve rates, interest rates, then let’s wait till that comes out so we know that we’re going down a path that won’t be inflammatory, to add more to inflation,’ ” Manchin told Hoppy Kercheval on Talkline. “He says, ‘Are you telling me you won’t do the other right now?’ I said, ‘Chuck, it’s wrong, it’s not prudent to do the other right now.’ “

CNN reported Thursday night that Manchin is open to letting Medicare negotiate prescription drug prices and to extending enhanced Affordable Care Act subsidies for two years, one of the sources said, which suggests that’s all Democrats are likely to get in the package.

In his statement, Biden did call on Congress to “give Medicare the power to negotiate lower drug prices and to prevent an increase in health insurance premiums for millions of families with coverage under the Affordable Care Act” and urged lawmakers to “pass it before the August recess” and send it to his desk for a signature.

Biden thanked Schumer, who took a lead role in the negotiations with Manchin, noting that he offered “significant compromises” as he sought to broker a deal.

“I want to thank Leader Schumer for his dogged and determined effort to produce the strongest possible bill to bring down costs, reduce the deficit, and combat the climate crisis while boosting our energy security — even offering significant compromises to try to reach an agreement,” Biden wrote.

It’s unclear if Manchin’s public position asking that negotiators wait until September to consider raising taxes or climate provisions means that prescription drug pricing changes and ACA subsidies would be separate. Democrats have pushed to finish a deal before August recess in order to give their vulnerable members of for reelection a chance to campaign on the legislation.

John Podesta, Center for American Progress founder and Obama climate adviser, expressed skepticism about Manchin’s push for more time to consider the deal.

“I think that string has run out,” Podesta said in an interview. “He killed this, and he has to own that. If he’s happy about the consequences of that, so be it, but it’s going to be devastating to a lot of people across the country.”

Manchin, who has cited increased federal spending as a main driver of inflation, would not budge on other Democratic priorities, and he told Schumer that he will not consider raising taxes on the wealthy or corporations.

The change in tone of the latest negotiations was abrupt. Manchin had supported those provisions throughout the negotiations with the majority leader, both at the staff and member level, one of the sources familiar said.

News of Manchin’s stance of not supporting climate and tax provisions to Democratic leadership, first reported by The Washington Post, was met with outrage from climate activists and many fellow Democrats, who have previously seethed over Manchin’s refusal to back some of the party’s more ambitious spending proposals. In December, Manchin had torpedoed a $1.75 trillion version of Biden’s climate and economic bill, known as the Build Back Better Act, angering the White House and Democrats who had pushed for a much larger $3.5 trillion spending plan at the beginning of the Biden administration.

“I’m not going to sugar coat my disappointment here, especially since nearly all issues in the climate and energy space had been resolved,” Senate Finance Chair Ron Wyden, whose committee had jurisdiction over the clean energy tax credits and corporate tax provisions, said in a statement.

“This is our last chance to prevent the most catastrophic—and costly—effects of climate change. We can’t come back in another decade and forestall hundreds of billions—if not trillions—in economic damage and undo the inevitable human toll,” the Oregon Democrat added.

Fellow Democratic Sen. Martin Heinrich of New Mexico questioned Manchin’s chairmanship of the Senate Committee on Energy and Natural Resources.

“We have an opportunity to address the climate crisis right now. Senator Manchin’s refusal to act is infuriating. It makes me question why he’s Chair of ENR,” Heinrich tweeted.

Similarly, climate advocates, many of whom were anticipating seeing climate and energy bill text soon, reacted on Thursday night with shock and outrage.

“This is nothing short of a death sentence,” Varshini Prakash, co-founder of youth climate group Sunrise Movement, said in a statement. “It’s clear appealing to corporate obstructionists doesn’t work, and it will cost us a generation of voters.”

“There truly aren’t words for how appalled, outraged, and disappointed we are,” Tiernan Sittenfeld, senior vice president of government affairs at the League of Conservation Voters, said.

Manchin’s office pointed to rising inflation. “Political headlines are of no value to the millions of Americans struggling to afford groceries and gas as inflation soars to 9.1%,” Manchin spokeswoman Sam Runyon said in a statement. “Senator Manchin believes it’s time for leaders to put political agendas aside, reevaluate and adjust to the economic realities the country faces to avoid taking steps that add fuel to the inflation fire.”

Data released Wednesday showed that inflation surged to a new pandemic-era peak in June, with US consumer prices jumping by 9.1% year-over-year — the highest level in more than 40 years.

But Evergreen Action co-founder Jamal Raad told CNN that Manchin’s argument about not spending more to avoid worsening inflation missed the mark when it came to energy and climate.

“He’s not even about solving inflation because the major driver of inflation was gas prices, and he decided we should invest more in fossil fuels,” Raad said.

Democrats are now pushing to get the Affordable Care Act subsidies extended before the August recess to avoid major rate hikes that will be announced just before the midterm elections in November.

The subsidies were expanded as part of the Democrats’ American Rescue Plan Act and made coverage on the Obamacare exchanges more affordable, leading to record enrollment this year. If they are allowed to expire at the end of the year, nearly all of the 13 million subsidized enrollees will see their premiums rise for 2023, according to the Kaiser Family Foundation. More than 3 million people could become uninsured, an Urban Institute analysis found.

Democrats are hoping to avoid the negative publicity of such premium increases. If Congress doesn’t act, consumers will learn in the fall just how much more they could have to pay. Open enrollment begins on November 1, a week ahead of Election Day.

This story has been updated with additional information.

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CNN’s Tami Luhby contributed to this report.