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Here’s How Democrats’ Big Domestic Agenda Bill Has Shrunk

WASHINGTON — The sweeping climate change, health care and tax package that is on track to clear Congress this week is a major victory for President Biden and Democrats in Congress, who toiled for months to salvage as much as they could of a domestic agenda that met with solid Republican opposition and resistance from within their own ranks.

But the plan, which passed the Senate on Sunday, falls far short of the transformational cradle-to-grave social safety net plan that Mr. Biden had pitched, which would have invested trillions in public education, affordable child care and a federal paid leave program, paid for by an overhaul of the tax code to target the highest earners and big corporations.

Many of those elements were dropped as Democrats contended with the realities of their slim majorities in Congress and the demands of two Democratic holdouts, Senators Joe Manchin III of West Virginia and Kyrsten Sinema of Arizona, with conflicting priorities.

Here’s a look at how the Democrats’ domestic legislation has shrunk.

How it started: President Biden made a variety of climate proposals central to his administration’s agenda, aiming to fulfill a pledge that the nation would reduce its emissions at least 50 percent below 2005 levels by the end of the decade. The proposals included the establishment of a Civilian Climate Corps, limits on offshore drilling, and ambitions to drive people and companies toward wind and solar power.

How it shrank: Mr. Manchin, a centrist Democrat protective of his state’s oil and gas industries, forced his party to set aside many of its climate proposals, including a plan that would have replaced coal- and gas-fired power plants with wind and solar power. In November, the House approved $555 billion for programs intended to curb fossil fuel emissions.

Where it stands now: Mr. Manchin signed off on nearly $400 billion in climate and energy programs, the largest federal investment toward battling climate change, but still well short of what Democrats had wanted. It was projected to cut greenhouse gas emissions about 40 percent below 2005 levels by the end of the decade. He also secured benefits for the fossil fuel industry and requirements for new oil drilling leases, as well as separate commitments to complete a natural gas pipeline in West Virginia and pass legislation to overhaul the permitting process for energy infrastructure.

How it started: Mr. Biden and Democrats pushed to redefine infrastructure beyond roads and bridges to include child care, a program to provide federal paid family and medical leave, and billions of dollars for college financial aid, housing support and home care. The House-passed bill also sought to maintain expanded monthly payments to families with children, which helped reduce child poverty.

How it shrank: Mr. Manchin expressed reservations about many of the programs, insisting that they should be limited only to the people who needed them — if they were included at all. When Mr. Manchin rejected a $2.2 trillion version of the domestic policy plan passed by the House last fall, the monthly payments aimed at reducing child poverty lapsed at the end of 2021.

Where it stands now: The programs were scrapped at Mr. Manchin’s insistence. Top Democrats spent time on the Senate floor Saturday vowing to pursue them in future legislation, though it was unlikely they could draw the requisite level of Republican support to do so.

How it started: Mr. Biden, backed by leading liberals like Senator Bernie Sanders, the Vermont independent, pushed to expand not only the scope of the Affordable Care Act, but Medicare benefits to cover hearing, dental and vision.

How it shrank: As lawmakers whittled down a $3.5 trillion budget blueprint, the House agreed to spend $165 billion to cover hearing for Medicare, provide insurance for an additional four million people through Medicaid and continue reducing health care premiums for people covered through the Obamacare marketplace.

Where it stands now: The Medicare expansion was among the items dropped in negotiations with Mr. Manchin. In a deal he struck late last month with Senator Chuck Schumer, Democrat of New York and the majority leader, the bill includes a three-year extension of expanded Affordable Care Act subsidies, set to expire at the end of the year, for an additional three years.

Democrats also added a plan aimed at lowering the cost of prescription drugs, fulfilling a longstanding goal of allowing Medicare to negotiate the prices of prescription drugs directly. The legislation would also cap the out-of-pocket amount that Medicare patients can be asked to pay for prescription drugs at $2,000 each year and restrict how much drug companies can increase prices for Medicare.

How it started: Democrats had envisioned a sweeping effort to make the tax code more fair that would roll back the tax cuts Republicans pushed through in 2017, vastly increasing what is paid by the wealthiest people and corporations. The House legislation was projected to bring in nearly $1.5 trillion over a decade by substantially increasing taxes on corporations and high earners.

How it shrank: Ms. Sinema objected to increasing most tax rates, throwing her support behind other tax-raising ideas that met with some pushback. She insisted on dropping a proposal aimed at narrowing a tax break for hedge funds and private equity managers that Mr. Manchin had pushed to include in the plan, which would have raised about $14 billion.

Where it stands now: To counter Ms. Sinema’s opposition to tax rate increases, Democrats included a more complicated 15 percent minimum tax on corporations. They narrowed that provision even further on Sunday, after a Republican amendment during the vote-a-rama, and included an extension of a deduction that small businesses take that had been scaled back under the 2017 tax law and was set to expire.

They also agreed to a 1 percent increase on company stock buybacks, set to go into effect in 2023. And in a bid to crack down on wealthy tax evaders, Democrats plan to invest $80 billion in enforcement at the Internal Revenue Service.

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