Biden Fails to Unify Democrats, Jeopardizing Legislative Agenda

Democrats remain deeply divided over the Biden-Harris Administration’s proposal to increase tax rates on businesses, farmers and ranchers, and blue-collar workers to fund their legislative wish list. The proposed increases come as the nation is recovering from the pandemic, and economic indicators point to rising inflation and fewer-than-expected new jobs.

Progressives continue to feud with the party’s establishment — which remembers the fallout in the 2010 midterms from the Obamacare tax hikes — concerned about maintaining their slim majorities. These drawn-out, public fights are over a variety of tax policy, including the corporate tax rate, the SALT deduction, and capital gains taxes.

Bloomberg: Progressives in turn have become frustrated with the moderates, arguing that the coming year is the party’s best chance to roll back the Trump tax cuts and use that money to fund spending on items including child care, community college and universal preschool.

The broad opposition in the Democrat Party to the administration’s proposals is putting Biden’s legislative priorities at risk. Without large and economically damaging tax hikes, Democrats would not be able to fund Biden’s $4 trillion in new proposals, including his bloated “infrastructure” package.

Bottom Line: Democrats’ slim majorities in both houses of Congress leave no room for error. With no signs of unification behind Biden’s proposals, the administration’s entire legislative agenda is at risk.