Democrats are sleepwalking their way to a paralysis of Republican control and for all the outrage over the last year, last six years, last ten years, it sure sounds like the party as a whole is about to give up. Nearly twelve years on from Joe Manchin literally shooting a cap-and-trade bill for a campaign ad, he appears to be the last remaining barrier of climate legislation today. After angrily shutting down the more expansive hodgepodge of progressive priorities making up the Build Back Better Act, Manchin has taken an ax to over $300 billion climate and energy spending and subsidies as well as hundreds of billions in tax increases on the wealthy and corporations The only pieces left are a temporary extension of healthcare subsidies and allowing Medicare to negotiate for prescription drugs. The eulogies have been written and the attacks have reigned down: Joe Manchin has ruined the planet and doomed humanity to failure. A day later, Manchin gave a quixotic denial of completely shutting the door on further negotiations, saying he could still vote for the climate and tax provisions in September if inflation cooled down. It appears many Democrats have taken that as a nonstarter, but I don’t think we have any other choice. Manchin isn’t to be trusted, but he’s the best chance we’ve got.
The death of cap-and-trade, at one point supported by both major party candidates in 2008, was not inevitable, and neither is the current predicament. For over a year now, Democrats have been locked in endless squabbles over what signature legislation there should be. I think that the so-called “moderates” have been an unhelpful dagger to the ambition of Democrats, but this should have been obvious for progressives and activists in the beginning. Any Democratic priorities that are to be passed with a simple majority are only going to get Democratic votes. There has been no effort to engage with or no interest at all from Susan Collins, Lisa Murkowski, or Mitt Romney supporting any of the Democratic agenda, despite their purported support for at least some of the key elements of healthcare, childcare, and clean energy. That leaves a bill that must earn the votes of Joe Manchin and Kyrsten Sinema, as well as several more red state Democrats and an obnoxious faction of House Democrats from New York and New Jersey.
If the climate emergency were truly the number one priority, Democrats didn’t always act like it. Senator Tina Smith helped draft up a transformative Clean Electricity Performance Program that would set a nationwide carbon intensity standard for electrical generation, a clever plan that could have been a reconciliation-friendly cap-and-trade of sorts. Joe Manchin was apparently never involved in these negotiations and not surprisingly, he was not supportive of a bill that would likely end coal generation in the not-too-distant future and would enact a cruder version of the same concept he shot down in his initial Senate run. The Build Back Better Act also included a plethora of partially funded programs, many of them important. It could have helped millions of Americans afford school, children, housing, and sickness. Nothing that would have ushered in a permanent Democratic majority, but it could have been the most transformative social program since Lyndon Johnson’s Great Society.
The Progressives conceded there would not be a full-scale Green New Deal, but at its most ambitious, the reconciliation package included free community college, an extra year of preschool, continued pandemic-level child tax credits, a government-backed childcare program, an ambitious clean energy spending package, money for affordable housing, and more. However, many of these programs-childcare and the Child Tax Credit for example, were only funded for a year or two in order to please the purported deficit hawks. The legislation would be paid for via tax hikes on the rich and corporations, closing tax loopholes, increased IRS enforcement, and healthcare savings from prescription drug negotiations. Unfortunately, the tax increases were shot down by various Democratic factions-Manchin and Sinema, but also Jon Tester, Bob Menendez, and many members of Congress have opposed meaningful tax reform, including plans to tax dividends, end inheritance subsidies, or simply increase rates for the wealthiest or corporations, The most significant piece of the 2017 tax bill that many Democrats have seemed eager to “reform” has been the most progressive part of it. Presumably thinking there is nothing more important than pleasing the donor base, most Democrats have gleefully touted efforts to remove or significantly raise the cap on state and local tax deductions. Even in the highest income states, the vast majority of benefits of tax deductions flow to the wealthy. Amidst a debate over a climate emergency, many so-called “progressives” and Joe Biden have also called for a suspension of the gas tax that will starve the government of revenue, increase driving, and given global supply constraints, would do more to increase oil company profits than provide relief.
I do not know exactly what is in the current reconciliation proposal on the table, but all discussions have pointed to a similar framework as the original Build Back Better Act. The bulk of the package was $320 billion in clean electricity tax credits, including for wind, solar, and nuclear energy, providing developers a boost in profitability through 2031.The majority of emissions reductions were in the tax credits, but there were other significant measures, including carbon capture and storage, electric vehicle incentives (which Manchin does not seem too fond of), wildfire mitigation funding, clean energy grants, and billions of dollars to bolster federal procurement of electric vehicles for the USPS and fleets. All told, this was projected to contribute to US GHG emissions reduced approximately 50% below 2005 levels by 2030, versus an estimation of approximately 20% today. These measures are not literally the difference between apocalypse and keeping global warming under 2 Degrees, but every bit does help. It is also not impossible that global circumstances, state policies, and private sector innovation will bring us to these targets without any government help, but that is not something we can count on.
Many Democrats and environmental advocates have pushed Biden to give up on negotiations with Manchin and pivot to executive orders. This is nothing more than a wild shot at the end of the game. Sheldon Whitehouse said that Biden should go into “executive beast mode” to combat climate change, proposing a range of key actions:
He as well as anyone else should know that few if any of these efforts will pass Supreme Court muster. While the Supreme Court issued a relatively narrow ruling limiting the EPA’s ability to regulate GHG emissions from power plants, there is plenty more opportunity for a further beatdown of the administrative state. There is no way that Biden will be able to implement a wide-ranging Social Cost of Carbon rule, require carbon capture, sue oil companies like they are oil companies, or institute a carbon border tariff without any Congressional approval. Biden has the ability to attempt these measures regardless of the status of reconciliation negotiations. However, I do not think it is worth spending too much effort on pursuing policies that are practically guaranteed to be rejected before they have a chance to take effect. If the Supreme Court does not reject these efforts out-of-hand, whatever lives by executive action also dies by executive action of any future Republican president.
It’s hard to know what would have gotten passed without Manchin in the way and whether Democrats would be better off politically than they are now or whether they even would have gotten anything more done with Sinema the deciding vote. Manchin was and is right to be concerned about inflation, but his opposition to even modestly raising taxes on the wealthy now is completely inconsistent with that stance. I believe Democrats can and should do more to combat inflation, including any measures that can be taken (though there are not many) to increase short-term energy supplies. In the short term, the best fiscal policy is to tamper demand via higher taxes; though not a popular sentiment, raising taxes, instead of providing “stimulus” or “gas tax” rebates, may avert a catastrophic recession or depression later. Local and state leaders could do a lot more to promote reducing consumption in these times. This includes encouragement of continuing work-from-home rather than forcing office workers back while there are sky-high gas prices and record inflation. Additional measures can be taken to promote carpooling, a transportation mode that has been in a long, slow decline and significantly increased US gas consumption. Finally, there is significantly more action that can be taken to reduce regulatory red tape such as reducing trade barriers allowing import of products that meet European or Canadian safety standards. Congress and the Biden administration can take measures to increase legal immigration, suspend tariffs, and suspend the Jones Act in a time of record low American unemployment and record-high prices. Congress can also do more to bend a reconciliation bill to Manchin’s will by delaying some spending projects while many materials are in short order and supply chains still have not recovered.
The unfortunate reality is there is little chance of Democrats keeping the House of Representatives come 2023. It is not impossible, but we should be doing everything we can now and be realistic about the future. While there has been a modicum of bipartisan cooperation in the Senate, there are fewer and fewer House Republicans who have any semblance of moderation, and none of them are willing to cross leadership to work on Democratic legislation. What’s done is done, though I fear that the politically and policy-ignorant tribalism is here to stay. The question though is what can be done in another four months. The hard truth is that without Democrat Joe Manchin from West Virginia, there is nothing that would have happened in the Senate in Biden’s presidency. Without a Democratic House, there will more likely be a government shutdown than a better climate and energy bill. If Joe Manchin had wanted to become a Republican, he could easily have pulled a Jeff Van Drew in 2020, switched parties, and committed himself for Trump. Instead, Manchin has been a reliable vote for judicial and executive branch nominations, including supporting clean energy advocates unanimously opposed by Republicans. He voted for a Democrat-only COVID relief package in 2021 and there is no other 50th senator at the negotiating table to come up with any significant clean energy package or prescription drug reform. Joe Manchin rose to power through Democrat failure to win seats in Wisconsin, Pennsylvania, Florida, and North Carolina in 2016, 2018, and 2020 and failure to garner any sympathy from Collins, Murkowski, or Romney. The Senate environment in 2024 and beyond is difficult to say the least, with a nontrivial chance that Republicans end up with 60 seats. Hate him or despise him, Joe Manchin is the best we’ve got.
