We have heard Manchin talk like this before, of course, and watched him continue negotiations on Chuck Schumer’s reconciliation bill anyway. In the days before the CPI numbers came out, the parameters of a deal had once again begun to leak. Those included a trillion dollars in “revenue enhancers” (tax hikes), along with around $850 billion in spending on climate change, drug pricing, and ObamaCare subsidies that Democrats desperately need to avoid massive price hikes in the exchanges from hitting voters just weeks before the election.

However, the Washington Post reported overnight that Manchin now refuses to support the spending on climate change and the tax hikes. That leaves nothing much other than the drug pricing and a short run of subsidies left to discuss:

Sen. Joe Manchin III (D-W.Va.) told Democratic leaders Thursday he would not support an economic package that contains new spending on climate change or new tax increases targeting wealthy individuals and corporations, marking a massive setback for party lawmakers who had hoped to advance a central element of their agenda before the midterm elections this fall.

The major shift in negotiations — confirmed by two people familiar with the matter who spoke on the condition of anonymity to describe the talks — threatened to upend the delicate process to adopt the party’s signature economic package seven months after Manchin scuttled the original, roughly $2 trillion Build Back Better Act, which President Biden had endorsed.

But Manchin told Democratic leaders he is open to provisions that aim to lower prescription drug costs for seniors, the two people said. And the West Virginia moderate expressed support with Senate Majority Leader Charles E. Schumer (D-N.Y.), the party’s chief negotiator, for extending subsidies that could help keep health insurance costs down for millions of Americans, one of the sources said.

Ahem. The “original” BBB cost $5 trillion, not $2 trillion. That latter figure was “roughly” achieved with nonsense sunset clauses that Manchin refused to acknowledge. Even a later proposal submitted to the CBO put the price tag at $3 trillion to the deficit over the following ten years. Manchin didn’t bite at that time when inflation was running lower than it is now, and he’s clearly not biting now.

But he’s not leaving the negotiating table yet, either. Punchbowl reports that Manchin wants some wins too, but just doesn’t want to dance to Schumer’s tune:

Manchin has dropped his support for the inclusion of tax and energy policies, deficit reduction and other provisions which he has long supported, according to a Democrat briefed on the discussions.

This is another setback for Schumer and the White House. They hoped that allowing Manchin to take the lead on the package – dubbed Build Back Manchin – would resolve any concerns he might have.

However, people close to Manchin say this is a move to box him into a Schumer set deadline, adding that the West Virginia Democrat hasn’t walked away from the negotiating table.

These sources also said Manchin has been clear this week that nothing had been agreed to yet and Democratic leaders needed to proceed cautiously on the climate and tax provisions of any reconciliation package given the latest economic data, including Wednesday’s disastrous inflation report. You can’t back out of something you haven’t agreed to in the first place, the sources said. Manchin has been very upfront about his concerns over inflation.

This looks like a trap for Schumer, however. In order to pass a reconciliation bill, certain prerequisites apply. The proposals have to be entirely budgetary (rather than policy-making), and they have to keep from adding to the overall deficit. If Manchin is dropping support for the tax hikes that have been part of the package, how will Schumer balance out the spending on even the limited areas that Manchin claims he will still support? Two years of the ObamaCare subsidies will still run close to $50 billion; the projected “permanent” cost for ten years was around $220 billion in the previous round of negotiations. The drug-pricing proposal for Medicare is projected to save money for the federal government, but how much money in practice that will be remains to be seen.

But even if that qualifies under reconciliation, that’s a breathtakingly small-potatoes package. BBB would have gone from a $5 trillion progressive hobby-horse bill to a $50 billion health-care cost tradeoff. It would be almost literally one percent of what progressives in the House and Senate wanted out of this session and this reconciliation package. It’s almost designed by Manchin to be an insult, especially after Manchin already got his $1.2 trillion in bipartisan infrastructure spending out of the hands of progressives, who spent months hostaging it in an attempt to steamroll Manchin on the $5 trillion version of BBB.

That brings us to the main point. Can this One Percent Solution pass in either the House or Senate? No one’s yet calculating that, but the angry tone in this morning’s report from the New York Times on Manchin’s change of heart should give us a hint:

How One Senator Doomed the Democrats’ Climate Plan

Senator Joe Manchin III of West Virginia led his party and his president through months of tortured talks, with nothing to show for it as the planet dangerously heats up.

First, he killed a plan that would have forced power plants to clean up their climate-warming pollution. Then, he shattered an effort to help consumers pay for electric vehicles. And, finally, he said he could not support government incentives for solar and wind companies or any of the other provisions that the rest of his party and his president say are vital to ensure a livable planet.

Senator Joe Manchin III of West Virginia, who took more campaign cash from the oil and gas industry than any other senator, and who became a millionaire from his family coal business, independently blew up the Democratic Party’s legislative plans to fight climate change. The swing Democratic vote in an evenly divided Senate, Mr. Manchin led his party through months of tortured negotiations that collapsed on Thursday night, a yearlong wild goose chase that produced nothing as the Earth warms to dangerous levels.

How excited will Bernie Sanders and his wing of the party be to vote for Manchin’s new plan for reconciliation? Just as excited as the NYT was to report it, I’d imagine. Manchin has just gutted their last chance to address climate change — no one thinks progressives will be in position to dictate policy in the next several sessions of Congress — and left them with almost nothing from their entire agenda for any kind of a win. Even the progressives’ class-warfare tax hikes are gone now, and all that’s left is a couple of tweaks on health care that will end up being a wash politically as well as fiscally. Heck, some Republicans would have voted for the Medicare drug-pricing change in the end, although certainly not the O-care subsidies.

The big question now will be whether Chuck Schumer has enough nerve to put this in front of progressives at all. Manchin may not have directly killed the reconciliation bill, but he is forcing Schumer to choose whether to do it himself.