Biden can fight climate change, guarantee housing, and halve poverty — without the GOP

Biden’s majority is fragile. But it could also be incredibly powerful.

Despite Joe Biden’s defeat of Donald Trump, the November election was a bit of a letdown for Democrats. The party lost House seats, and Senate Republicans did better than expected, dashing progressives’ dreams of a transformational Biden administration.

Then January 5 happened. Democrats Jon Ossoff’s and Raphael Warnock’s victories in the Georgia runoff elections mean that the Democratic policy wish list has been disinterred — even if the reality of a 50-50 Senate and slimmer Democratic margin in the House may force the party and the president-elect to temper their ambitions.

That gives Biden two years to move — two years with a 50-50 Senate when he’ll be constrained by what moderates like Sens. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ) are willing to vote for.

Still, Biden and his allies in Congress can accomplish an awful lot through a process called budget reconciliation. The Senate filibuster means that a bill typically requires 60 votes to move forward. With only 50 Democratic senators (plus tie-breaker Vice President-elect Kamala Harris), that’s a nearly insurmountable barrier. But the budget reconciliation process exempts certain legislation that primarily affects taxes and spending from the filibuster, meaning the 50 Senate Democrats can pass it on their own.

That makes reconciliation the most crucial process for the Biden presidency, through which his legislative agenda will live or die.

Not everything can pass through budget reconciliation. It likely rules out measures like a minimum wage increase, or DC and Puerto Rico statehood, or updates to the Voting Rights Act, or gerrymandering reform.

Still, it’s plausible that Biden and his allies in Congress can use budget reconciliation to accomplish large swaths of his agenda, including paid parental and sick leave, universal pre-K, a $3,000 child allowance, universal housing vouchers, a massive investment in clean energy, expanded health care coverage, and more.

During the general election, Biden’s team talked about him as the next FDR: a president who could seize a crisis to fundamentally transform the role of government. What he can achieve through reconciliation falls short of those ambitions; he will not turn America into a European social democracy overnight.

But what Biden can do — consensus items that most congressional Democrats agree on and have been campaigning on for years or decades — could nonetheless transform American life dramatically. An America where pre-K is universal and child care is affordable for all, with trillions in clean energy investment, free community college, paid maternity leave, a child allowance for parents, and a housing program that nearly eliminates homelessness, is a very different America. And it is in reach for the Biden administration.

The potential and limits of a Senate majority

Joe Biden’s agenda is vast and impossible to summarize in a single article, even when confined to what’s possible under budget reconciliation. But to pick out some of its most important aspects, Biden could:

• Approve $2,000 checks, state and local aid, and a boost to vaccine funding
• Create a $3,000-per-year child allowance for parents
• Make housing a human right funded through federal vouchers
• Guarantee paid maternal/sick leave
• Achieve universal pre-K for all 3- and 4-year-olds, and massively expand child care access
• Spend $2 trillion investing in clean energy and climate R&D
• Forgive the first $10,000 in student loans for all debtors
• Make community college free for all
• Reduce Medicare eligibility to age 60 and perhaps create a public option open for all
• Raise taxes on the rich by $4 trillion
• Effectively abolish the debt ceiling to prevent future GOP hostage-taking

To understand why this is possible, and much of the rest of his agenda is likely not, you have to know a bit about the filibuster.

The filibuster, a Senate practice developed in the mid-19th century, gives senators the power to delay legislation by either speaking indefinitely or (most often) merely threatening to speak indefinitely. Initially, there was no way to end a filibuster as long as the senator in question was committed to delaying; in the 20th century, though, the Senate developed the “cloture” rule, which allows a supermajority of senators, currently 60, to end a filibuster. Under the Obama and Trump presidencies, filibusters became so frequent that there is an understanding that all legislation supported by one party but not the other will need 60 votes to overcome a filibuster and pass the Senate.

But there is a catch: In the 1970s, the Senate crafted a process called “budget reconciliation” that allows certain legislation to avoid a filibuster. It’s a major advantage that has unsurprisingly been used for lots of major legislation over the years: the 2017 Trump tax cuts and 2001/2003 Bush tax cuts, the 1996 welfare reform act, and the 2010 bill in which Obama and allies nationalized the student loan industry.

It also means that the 50 Democratic senators plus Vice President-elect Kamala Harris will be able to pass some types of legislation, so long as all Democrats are in agreement.

However, reconciliation comes with profound limitations. It can usually only be used once per budget resolution, which in theory works out to one reconciliation bill a year. (Since Congress hasn’t yet passed a budget resolution for fiscal year 2021, Democrats could do two bills this year, one for 2021 and one for 2022; the details are a bit complicated, as the Center on Budget and Policy Priorities’ David Reich and Richard Kogan explain.)

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Then there are the limits on what a bill passed under reconciliation can do, imposed by the “Byrd Rule,” which offers a way for senators to raise an objection against “extraneous” provisions in bills being considered under reconciliation. If the Senate presiding officer (who has historically always acted on the advice of the nonpartisan Senate parliamentarian) agrees, the provision is struck.

The basics of the Byrd Rule are that reconciliation bills cannot change Social Security, or have merely “incidental” effects on spending/revenue, or increase deficits after 10 years. There are a couple of other limitations as well, but those are the major ones. In other words, reconciliation can be used for spending and taxing, but usually not for pure regulation or legal changes. If the main effect is not budgetary, it’s not reconcilable.

The purpose of budget reconciliation is to reconcile tax and mandatory spending laws to the budget, and it’s never been used to alter discretionary spending, which sustains the military, most domestic government agencies, and some social programs like Head Start, although an ambitious vice president willing to lean on the Senate parliamentarian might be able to force through at least some changes.

Those strictures set some pretty stiff limits on Democrats’ legislative ambitions. Some examples of legislation that probably wouldn’t survive a “Byrd bath” (the Capitol Hill term of art for how the Senate strikes Byrd-violating provisions from reconciliation bills) include:

• Statehood for DC and Puerto Rico
• A minimum wage increase to $15 an hour
• Comprehensive immigration reform
• Redistricting and/or campaign finance reform
• Revival of the Voting Rights Act
• A nationwide mask-wearing mandate
• A nationwide ban or limit on indoor dining or other Covid-19 spreading activities
• Labor law reforms to make it easier to join a union

A minimum wage increase, for example, might indirectly affect the federal budget by leading to higher income and payroll tax revenues and less expenditure on food stamps. But that’s exactly the kind of “incidental” effect the Byrd Rule doesn’t allow legislation to use as an excuse.

But even with those constraints, there is still plenty that Democrats can do. Any spending or tax measure that is deficit-neutral or expires within 10 years and doesn’t touch Social Security is fair game. If the legislation requires accompanying regulation, the situation could get more difficult, but as long as those needs are minimal, reconciliation is a doable option.

So let’s go through Biden’s agenda and highlight some key measures that likely can be included in reconciliation.

Biden’s reconcilable agenda

Biden laid out an extensive legislative platform during his campaign. It starts with his preferred response to the Covid-19 pandemic and accompanying economic crisis. But it goes well beyond that, too. His “Build Back Better” plan spans clean energy, caregiving/universal pre-K, subsidies for US manufacturing, and measures to remedy the racial wealth gap.

The measures detailed below are all pulled from the platform that Biden (and in one case Harris) laid out during the campaign. They are not maximalist measures from the left wing of the congressional Democratic caucus; they are measures with buy-in from the executive branch.

That does not mean that all of these will pass under Biden. What Biden and Harris are willing to support and what Sens. Manchin and Sinema, the likely swing voters in the Democratic Senate caucus, are willing to support are two categories that only sometimes overlap. Fitting all these measures into just a few reconciliation bills would also pose daunting timing and logistical hurdles.

But these measures nonetheless give a sense of what Democrats could do if Manchin and Sinema get in line — and, tellingly, this list does not include cultural hot-button issues like gun control, new restrictions on coal energy, or expanded immigration, which could mean that there’s more for Manchin and Sinema to like here than it might seem.

Covid-19

The first and arguably most important thing Biden and his allies can do with reconciliation is invest in his Covid-19 response agenda. Some of these items can be implemented with the president’s authority alone (like using the Defense Production Act to ramp up production of masks and other personal protective equipment), and some require formal legislation (like nationwide mask mandates, though Biden’s plan suggests he would implement mandates by leaning on governors rather than passing a bill).

But some of it is mostly about increasing federal spending on certain programs, and so long as the spending is structured as a mandatory program, it will likely make it through reconciliation. For instance, Biden has called for a Public Health Jobs Corps comprising over 100,000 employees to work on contact tracing and other pandemic response; a $25 billion investment in vaccine manufacturing and distribution; and a “restart package” for small businesses to help them operate safely during the pandemic. All of those are measures that could likely survive reconciliation.

Stimulus

Biden has consistently called for additional relief measures, beyond those passed in December. He has embraced calls for $2,000 stimulus checks (on top or instead of the $600-per-adult checks approved in December), additional relief to states and localities (specifically calling for a “renewable fund for state and local governments” and “an emergency package to ensure schools have the additional resources they need to adapt”), and nationwide “work sharing” to deter layoffs during recessions.

Biden has also endorsed the HEROES Act, the House-passed $3 trillion stimulus measure that would have extended the $600-per-week bonus unemployment insurance in effect last summer, rather than the $300-per-week bonus passed in December. It’s not clear whether he would push to increase the bonus to $600 in the coming months, or for retroactive UI benefits for August through December, when there were no bonus benefits. Biden has, however, said that the $600 bonus payments should last “for however long this crisis lasts,” which would suggest retroactive payments and a boost to $600 going forward.

All of the above could be passed through reconciliation. Biden could also, if he wanted, use reconciliation to pass measures creating “triggers” so emergency provisions like extra UI are triggered automatically in future crises. This is a common feature of reform proposals like Democratic Sen. Michael Bennet’s, and Senate Finance Chair Ron Wyden has said he wants “automatic stabilizer” provisions like these included in an economic relief bill. This measure would likely have to expire in 2031, to avoid increasing the deficit outside of the 10-year “window,” but it could make the response to future recessions much faster and more robust.

Anti-poverty measures

Biden and Harris have embraced an extensive anti-poverty agenda, almost all of which is passable through the reconciliation process — though unless paid for by tax increases, it would have to expire after 10 years. Harris co-sponsored the American Family Act, which would offer non-wealthy Americans at least $250 in cash per month, per child, to support struggling families with children. That measure would lift at least 4 million children out of poverty, and Biden has endorsed it in at least temporary form.

Biden has also endorsed making Section 8, the federal program offering housing vouchers to low-income families, an entitlement. Currently, only about one-quarter of families eligible for Section 8 benefits get them due to funding shortfalls. Biden’s proposal would make basic housing a universal benefit, cutting poverty substantially and homelessness dramatically, with one study suggesting vouchers could cause a 75 percent reduction in homelessness.

While Biden has not endorsed it, Harris has called for dramatically expanding the earned income tax credit (EITC) by creating a new $3,000-per-worker credit that phases in, dollar for dollar, with income. A full-time worker at the minimum wage earning $14,500 a year would get an additional $3,000 in benefits. While that’s on the more dramatic end of what congressional Democrats are likely to support, almost all Democrats have endorsed a plan called the Working Families Tax Relief Act that includes a more modest bump in the EITC. Put together, these plans could cut poverty in the United States by as much as half.

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Pre-K and caregiving

Biden has an extensive caregiving agenda, which got a central role in his “Build Back Better” program outlined last summer. It includes a subsidy and tax credit package to states to guarantee universal pre-K access for 3- and 4-year-olds, increased funding for Medicaid’s long-term care services and support, a refundable child care tax credit of up to $8,000 per child under age 13, and a state partnership offering a sliding-scale child care subsidy based on the Child Care for Working Families Act sponsored by Sen. Patty Murray (D-WA) and Rep. Bobby Scott (D-VA).

He has also endorsed paid family and medical leave along the lines of Sen. Kirsten Gillibrand’s (D-NY) FAMILY Act, though Biden would pay for it with tax increases on the wealthy rather than Gillibrand’s proposed mild payroll tax increase.

All of those spending measures can be passed through reconciliation. But Seth Hanlon of the Center for American Progress flags that Biden’s plan to give caretakers a wage credit for Social Security, effectively raising retirement benefits for stay-at-home parents and full-time elderly/disabled family caregivers, could not run through reconciliation because the process bars changes to Social Security.

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Education

Beyond pre-K and caregiving, Biden has also proposed free community college and forgiving the first $10,000 in student loans held by all debtors. While raising committee issues, both those policies are easily doable through reconciliation. Indeed, the modern student loan program was created in 2010 through a reconciliation bill.

Climate change

As David Roberts has explained for Vox, budget reconciliation is probably the best way to pass climate legislation under a Democratic administration. Some of Biden’s agenda, like a binding 100 percent clean energy requirement by 2050, is likely off limits to reconciliation as it’s closer to regulation than taxation.

But Biden also pledged $2 trillion in climate spending, which can be passed through reconciliation. Of that $2 trillion, $400 billion will go to federal purchases of clean energy tech like batteries and electric vehicles to help boost those industries. Other components include infrastructure projects like electricity grid upgrades and universal broadband; expanded public transportation; and massively expanded R&D spending on clean energy and carbon removal.

Health care

Biden’s health care plan calls for reducing the Medicare eligibility age from 65 to 60, offering a public option open to individuals and employers (including individuals getting private insurance through their employer), boosting the Affordable Care Act’s subsidies for health insurance, and making Medicaid expansion available to the 14 states that have not embraced it through the new public option.

My colleague Dylan Scott has more details here, predicting that while subsidy expansion is likely, a public option will be a much harder lift for Democrats. There is some ambiguity about whether a public option is passable through budget reconciliation, as Scott notes, but many Democrats believed it was in 2010 during the Obamacare fight. A Medicare age change is almost certainly passable.

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Tax increases

This is a somewhat odd time to be raising taxes, given the still-nascent economic recovery and rock-bottom interest rates that make it cheaper to pay off federal debt in five to 10 years than to prevent incurring the debt now. But Biden has promised not to raise taxes on people making under $400,000 and to substantially increase taxes above that mark to the tune of $4 trillion over 10 years, and all of that could be done in reconciliation — and used to pay for some other items on his agenda outlined here.

Debt ceiling

One of the biggest thorns in the side of the Obama administration was Congress’s statutory limit on the amount of debt the United States could have outstanding, a limit that gave House Speaker John Boehner incredible leverage, most notably in the summer of 2011, to threaten to force a default on the US’s debts if his legislative demands were not met.

Abolishing the debt ceiling entirely may not be possible through reconciliation, but it can certainly be rendered impotent by raising it to, say $999 quadrillion.

The Biden legacy

Fitting all of those measures into two or three reconciliation bills from 2021 to 2023 would be challenging. It would require herculean efforts of vote-wrangling in the Senate, and likely some unsavory deals akin to the “Cornhusker Kickback” subsidy to Nebraska that got Sen. Ben Nelson (D-NE) on board with Obamacare in 2009. Biden and his administration will need to prioritize carefully, and perhaps drop some measures they consider too difficult to get Democratic consensus on.

There’s also a chance that the sheer cost of some of these measures will bring back the austerity politics that dominated much of Obama’s presidency. Biden has been talking a good game about the necessity of increased deficit spending, especially on temporary investments like green energy. But moderates like Manchin and Sinema may balk at a $4-5 trillion combined price tag for his agenda.

The list above also does not resolve some of the Democratic Party’s longer-term problems, like its geographic disadvantage in the US Senate and the challenge of state-level gerrymandering. Admitting DC and Puerto Rico as states would alleviate the former a bit (though not enough), and mandating independent redistricting commissions would alleviate the latter — but those are likely not doable through reconciliation. With Democrats unlikely to get a 60-vote majority anytime soon, that could mean the party’s structural problems will just keep getting worse.

But enough caveats; the agenda above is enormous. It would make the US no longer the only industrialized country without paid family leave. It would dramatically reduce homelessness and evictions by ensuring all low-income families have a right to housing. It would slash child and adult poverty and greatly accelerate America’s (and the world’s) transition away from fossil fuels.

It’s easy to be cynical about American politics, especially if you have been fighting for the above goals for decades to little avail. But you should allow yourself to feel a little hope in this moment, too. We’re about to embark on a rare two-year period where big changes are possible. That’s worth getting excited about.