From left to right, the one thing political observers and participants around the globe seem to agree on is that the neoliberal world order that arose out of World War II, and became hegemonic after the collapse of the Soviet Union, is in deep crisis — and has been since the financial crisis of 2008.
What type of world order will emerge from this crisis is hotly disputed, a question that hasn’t been so open since the 1930s. How exactly the U.S. emerges from this crisis, and in what state, will be significantly determined by the legislative jockeying of the next few months. On leftist social media, the Biden administration’s obituary has long been written, its death pinpointed in the failure to attach a minimum wage increase to its early stimulus package and the subsequent lack of effort put into a public health insurance option or other campaign priorities. News Thursday of a bipartisan infrastructure deal struck between Congress and the White House was met with a mixture of scorn and boredom.
Yet the Biden administration agenda that is still very much alive carries arguably far more potential consequence for a fundamental reorienting of the American economy. If the neoliberal order is collapsing, the next few months offer Democrats a perhaps-final chance to build something new in its place.
Democrats have zero margin for error, or senatorial morbidity, in a Senate divided evenly 50-50. In the House, a four-seat majority gives the party barely more room.
But Democrats, including their leadership and rank and file, are unusually motivated for a party that flinched at its own shadow for the past 40 years. There is broad recognition within the party that Democrats are likely to lose one or both chambers of Congress in the midterm elections and that 2022 is unlikely to yield significant legislative opportunities. It’s now or never.
By enacting major spending bills before that happens, Democrats will be able to continue governing and investing in public infrastructure over the next six years even without control of Congress. This marks a departure from the Obama administration, whose final six years were a tangle of economic stagnation and congressional confrontations over austerity, culminating in the election of President Donald Trump.
And so it is no coincidence that the bipartisan agreement has only been reached after progressive Democrats in the House and Senate insisted loudly that no bipartisan deal could happen without a simultaneous pledge to push through the transformative, multitrillion-dollar agenda using reconciliation, which requires just 50 votes in the Senate.
Over the past week, as Congress negotiated the bipartisan infrastructure package that would include less than $600 billion in new spending, a slew of Democrats in the House and Senate said that they won’t vote for any bill that lacks sufficient funding for climate-related projects and social investments. The White House announced that the bipartisan bargain had been agreed to Wednesday night, and House Speaker Nancy Pelosi, D-Calif., said Thursday morning that the House would not pass the bipartisan bill without a reconciliation package, endorsing a so-called two-track strategy.
“There ain’t gonna be no bipartisan bill unless we’re going to have a reconciliation bill,” Pelosi told reporters at her weekly press conference. “We will not take up a bill in the House until the Senate passes the bipartisan bill and a reconciliation bill. If there is no bipartisan bill, then we’ll just go when the Senate passes a reconciliation bill.”
President Joe Biden echoed her strategy. “If this [bipartisan deal] is the only thing that comes to me, I’m not signing it,” he said.
Schumer said Thursday he had proposed the strategy to them both. “About a month ago I laid out a two-track strategy to move the whole process forward. I talked to both President Biden and Speaker Pelosi and they agree with that strategy so now all three of us are on that page. Today was a big step forward for the two-step strategy,” he said.
The latter package could add up to another $6 trillion over the next decade; it carries with it the fate of the Biden administration and will significantly shape how the United States emerges from the crisis produced by the collapse of the neoliberal order.
The world order ushered in during the late 1970s and early 1980s involved the destruction of the capacity to govern; the deregulation of finance as well as a hands-off approach to corporate concentration; the crushing of organized labor; and the privatization of public assets, all of it fueling runaway wealth and income inequality, driving millions into poverty, and eroding civic and democratic norms. Upending that order requires a reassertion of the public’s role in the economy. It requires a government willing and able to govern. Essential, though not entirely sufficient, to that projection is the $2.3 trillion package dubbed the American Jobs Plan and the $1.8 trillion American Families Plan.
Biden’s first move, a $1.9 trillion rescue package that included direct checks and sizable child tax credits that began rolling out this month, has been followed by months of legislative stagnation.
The most celebrated element of that initial package was the advent of child tax credits that deliver between $300 and $360 per month, per child to all but the wealthiest families. Those checks began arriving this month, and the main criticism of the project has been that it lasts only one year. The new measure would extend it well into 2025, with some Democrats pushing to make it permanent.
The American Jobs Plan also includes the Protecting the Right to Organize Act, sweeping labor reform, much of which can be enacted through reconciliation. Immigration reform advocates have pushed to include elements of their agenda that can go through under reconciliation as well. That’s on top of the hundreds of billions in climate-related infrastructure investments included in the American Jobs Plan.
News of the bipartisan deal was a blow to Senate Minority Leader Mitch McConnell, R-Ky., who has been working to string out talks as long as possible, with the hopes of running out the clock. But the fact that he has dragged the process along as long as he has is a win, with Democrats now up against the July 4 recess. On Tuesday, Senate Majority Leader Chuck Schumer, D-N.Y., told reporters that the bipartisan bill and the first phase of the reconciliation package would be passed in July.
The reconciliation bill is a complex process, first requiring a Senate floor vote to set a top-line number and refer work to various committees to fill in details. Once the committees have done their work, they will send the package to the Budget Committee, chaired by Sen. Bernie Sanders, I-Vt., who will then move it back to the floor, where it will undergo what’s called a “vote-a-rama” — a night or two of amendments — followed by a final vote. Congressional sources in both chambers said this week that the work on the reconciliation package is far advanced and on target for July.
Some Democrats have argued that the entire process must be complete before the House votes on the bipartisan bill, while others have said that as long as it is underway, it’s OK to move.
“I think we need more than evidence. I think they need to be moved pretty much at the same time,” Rep. Alexandria Ocasio-Cortez, D-N.Y., told The Intercept earlier this week, echoing a strategy she’d first promoted earlier in the month. “I don’t think they can hold the House vote and keep the caucus together unless we have both.”
Two weeks ago, Rep. Ro Khanna, D-Calif., deputy whip of the Congressional Progressive Caucus (CPC), insisted publicly that no package would pass if it did not robustly address climate change. The CPC surveyed its members to see how many would hold firm, and found strong appetite. “A recent poll of our 95-member Caucus showed overwhelming support for the House not passing a bipartisan infrastructure bill unless a larger reconciliation package containing our progressive priorities moved simultaneously,” said CPC Chair Pramila Jayapal, D-Wash. Those results were relayed to the White House and leadership, an aide said.
Sen. Chris Van Hollen, D-Md., a member of the Budget Committee, said Monday that Senate committee staff and House Budget Committee staff had been in talks about that very strategy. “The House is the ultimate backstop. My view is that we should get the commitments here,” he said, meaning that all 50 members of the caucus must be committed to doing a reconciliation package before he and other holdouts would vote for a bipartisan bill.
Sen. Chris Murphy, D-Conn., told The Intercept earlier this week that he’d refuse to vote for a bipartisan bill without a promise of a reconciliation package. “We’d need to be in caucus, look these members in the eye, and get a commitment not only that we are going to do reconciliation but some guarantee on the substance of that reconciliation package,” said Murphy. “I think we’ll have to have some tough conversation in the caucus before there are enough votes to proceed on this package.”
“We just have to have an ironclad commitment that we’re going to go big,” said Sen. Brian Schatz, D-Hawaii.
Sen. Elizabeth Warren, D-Mass., used the same phrase. “Ironclad,” she said, when asked what type of assurance she needed that both would get done. Asked what that meant specifically, she said, “It may mean the order of votes. And remember, we’re going to have two key votes around reconciliation, and getting those top-line votes through in July will be a big step toward getting all of the Democrats committed to a reconciliation package that will ensure that what we do on infrastructure meets the problems that are out there.”
“We have two tracks,” said Sen. Ed Markey, D-Mass., “but ultimately the two tracks all have to meet in the end to make sure we actually have a climate infrastructure package that dramatically lowers emissions, that has environmental justice at its heart, and that it creates millions of new union clean energy jobs.” (On Thursday, Sen. Joe Manchin, D-W.Va., started sounding like Markey, telling NBC News, “It’s the only strategy we have — is two track.”
“I think it’s politically close,” Schatz said, adding that the details still needed to be worked out. “It’s a pretty realistic pathway. Everyone has their incentives in line.”
Republicans, meanwhile, have said they won’t support a package that has too much in the way of climate. But they recognize that they don’t have the numbers to stop Democrats if they remain united.
Asked if his support for a bipartisan infrastructure package hinged on Democrats committing not to use reconciliation for a second package, Sen. Richard Burr, R-N.C., said it did not. “It hinges on getting a good infrastructure [bill],” he said. “I don’t have any control over what they do next.”