What to Watch in the Budget Reconciliation Negotiations

Charles Cooper

Charles Cooper, Managing Director & Chair of Advocacy discusses the complex web of policy and political attitudes across caucus membership, and the core factors to watch that are driving current negotiations around the budget reconciliation package.

As negotiations continue around the budget reconciliation package, many observers are surprised that a Democratic-controlled House of Representatives, Democratic-controlled Senate, and Democratic President in the White House are seemingly unable to quickly advance the package through the legislative process. These observations rely on the false assumption that all Democrats have the exact same policy priorities, political risk calculations, and constituent interests. The reality is that Democratic leaders are navigating a complex web of policy and political attitudes across a diverse caucus membership. It is a difficult task and one where the rhetoric on the campaign trail around the simplicity of advancing legislative victories is somewhat distant from reality.
When I was in senior positions within House leadership over a decade ago, the same complexities arose when seeking to advance major priorities. While the other side of the aisle was always a factor to consider, the hurdles to advancing policy often emerged within our own caucus and were extremely difficult to overcome.
Below are core factors to watch that are driving current negotiations:
The Top-Line Number Is An Issue, Not The Issue:  The scope (what provisions to include) and scale (what the size of the provisions are) of the legislation have been the two core considerations from the start.  Today, negotiations are focused on the scope – what top-line funding levels will be included. Once that is agreed upon, there is still a ton of work to be done to align priorities with the new top-line numbers. While it has proven difficult to find agreement on a top-line number, identifying what needs to be removed or reduced to accommodate that number is likely to be even more difficult.
The President is Focused, But Has Other Priorities:  Advancing one (or both) infrastructure packages is a major priority for the President at a time when he realty needs a significant legislative accomplishment. His engagement has led to some progress recently, binmut he also has a long list of issues that is requiring his attention and political capital, not the least of which is the debt ceiling, Fiscal Year 2022 appropriations, COVID pandemic response, and international affairs including both China and Afghanistan policy.  His level of engagement will be something to watch as these negotiations continue.
The “Family Discussion” Between Progressives and Moderates: Progressives and moderates are battling over specific provisions, overall funding levels, and revenue proposals. Progressives view budget reconciliation as the only opportunity to advance their policy priorities, while moderates favor the smaller, bipartisan infrastructure package. Both are seemingly on opposite sides of the negotiating table, but at least they remain at the table. It will be important to see if they soften their current positions – which recent movements would suggest may be occurring – and if new concerns arise from either or both sides.
The Early Impact of the 2022 Election: With a narrow majority in the House and Senate (and well over a dozen Democratic seats in the House in play), policymakers are considering the political impacts for a vote that their political opponents will be heavily messaging around – especially in conservative districts that are currently represented by Democrats. The political tolerance for certain policies varies within the Democratic caucus – some policies that poll high in the northeast may face strong opposition in other regions represented by Democrats. Democrats in targeted congressional districts are, in part, considering what the electoral impacts of a potential vote on this bill will have…especially with less than 400 days until the 2022 election.

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