Sanders, Sinema agree: "So-called Inflation Reduction Act" stinks

Maybe the question isn’t whether Kyrsten Sinema will agree to the Joe Manchin-Chuck Schumer reconciliation bill. Perhaps we should wonder whether progressives will snatch defeat from the jaws of, well, lesser defeat once again in this session of Congress. A week ago, progressives sang Manchin’s praises for finally agreeing on a much smaller package of climate-change proposals. Now that they’ve seen it, they’re calling it “a climate suicide pact,” as Bernie Sanders testified on the Senate floor last night.

In his lengthy speech, Sanders demanded significant changes to what he described as “the so-called ‘Inflation Reduction Act’,” or else … something:

Punchbowl has more on Sanders, who spoke with John Bresnahan afterward:

On Wednesday, Sanders basically gave a “Good news, bad news” speech when discussing the current legislation’s impact on working-class Americans. The bill helps with prescription drug costs, but not enough. It helps with health care, but not enough. And on climate change, Sanders read a letter from the Center for Biological Diversity that called the bill “a climate suicide pact.” Yeah.

Here’s what Sanders told Bres last night following his speech:

Or else … what? Would Sanders kill the bill in its current form if his amendments don’t pass or Schumer reopens negotiations? That seems hard to believe, but Sanders and his allies nearly killed the easy-win bipartisan infrastructure bill last year, don’t forget. That was to protect $5 trillion in progressive hobby-horse spending, and the hostaging didn’t work, but progressives in both the House and Senate have been loathe to cut that outlay ever since.

The problem for Schumer is that Sanders isn’t alone in demanding changes. Even before he got up to deliver a broadside against the IRA, Sinema had begun to make her objections more clear, as Allahpundit wrote last night. Her changes may not be as drastic as those Sanders will demand, but they will almost certainly cut in the opposite direction, especially on taxes:

Politico reported that Sinema wants to get rid of a provision that would lengthen the holding period for carried interest — or investment fund managers’ share of their clients’ capital gains — required to benefit from more generous tax treatment. The provision would raise an estimated $13 billion over 10 years.

Sinema’s office declined to confirm the report, which also said the Arizona Democrat is seeking to add roughly $5 billion in drought resilience funding given her state’s water supply issues.

Separately, CNN reported that Sinema has sent signals to the business community that she may want to pare back a 15 percent corporate minimum tax on businesses that report $1 billion or more in income to shareholders.

Sinema asked business groups during a call Tuesday if the minimum tax was “written in a way that’s bad,” Arizona Chamber of Commerce President Danny Seiden told CNN. Seiden, who voiced the chamber’s opposition to the minimum tax and concerns it would particularly hurt manufacturers who take advantage of accelerated depreciation write-offs, said the call with Sinema gave him “hope that she’s willing to open this up and maybe make it better.”

Somehow, that doesn’t sound like the kind of changes that will make Sanders remove the “so-called” label off the bill, or take the scare quotes off of “Inflation Reduction.” Sanders isn’t exactly a fan of running tax policy by the Chamber of Commerce for their endorsement, needless to say. Cutting the tax hikes won’t improve the status of a bill that Sanders already describes as a “climate suicide pact,” likely especially given the energy concessions Schumer made to Manchin to get his agreement.

All of this prompts the question as to whether this agreement can survive even to a vote-a-rama. Even if Sanders begrudgingly decides that one slice is still better than no loaf at all, he’s drawing a line in the sand about the bill’s status quo, not Sinema’s demanded changes. Sinema is similarly drawing a line that makes clear she doesn’t even support the status quo, let alone the massive spending components Sanders wants to add or greatly expand to get his vote. They’re pulling in opposite directions and all but ensuring that Schumer won’t get to 50 in any version of this agreement.

Furthermore, Sanders’ derision on the Senate floor has made this bill politically toxic for House progressives in anything close to its current form, and especially if it gets changed to meet Sinema’s demands. Don’t forget that they also have to cast a vote on whatever comes out of the Senate — if anything manages to emerge, that is. Nancy Pelosi can only afford to lose four votes if and when this comes to the House, and she’s already dealing with massive discontent among her members about having to swallow whatever the Senate spoon-feeds them.

And again, all of this calls into question the process Schumer used to get this agreement in the first place. Back to Punchbowl:

This all begs an important question: Why wasn’t Sinema involved in cutting the deal? Schumer and Manchin have made clear that these negotiations were kept very private. Sinema and Manchin – referred to as “Sinemanchin” for a big part of this Congress – have been the two hardest to get to yes on bills crafted by the Democratic leadership and White House.

So why would Schumer ever cut a deal that she wasn’t a part of? The fact is that Sinema has gripes that are predictable, and the substance of her gripes are likewise predictable. Sinema hasn’t offered any complaints about being left out of the discussions, yet not including her clearly could cause problems on the other side.

If Schumer was trying to engineer a deal to fail, could he have done any better? And maybe that’s what Manchin had in mind, too. Perhaps he felt he could get Sinema to back his play, but if not, Manchin probably knew that progressives simply wouldn’t agree to it anyway. If it passed, he’d be the hero, and if it flopped, the failure would no longer be on his shoulders but on the Sanders/Jayapal wing of the party. Maybe that’s what Sinema has in mind, too.