Biden’s Stalled Revolution

By Ramesh Ponnuru

Thursday, April 15, 2021

 

Progressives are exulting. Slate, the online publication, ran an article about how the Democrats’ infrastructure bill “leaves Reaganomics on the ash heap of history.” In the New York Times, Ezra Klein has written about “the radicalism of Joe Biden” and how circumstances have “unleashed Democrats’ legislative ambitions.” Progressive historians trooped to the White House to tell Biden he could be another FDR. Democrats say that what they learned from the Obama years is that they should go bold rather than seek compromise with Republicans. The Republicans agree that the Democrats are yanking the country left, although obviously they have a different reaction to it.

 

Public policy is moving left, no question. But while both parties have their reasons for depicting the Democratic government in Washington, D.C., as a progressive juggernaut, that doesn’t mean it’s true. For all of the Democrats’ ambitions to transform the country, there’s not a lot of transformation under way.

 

Consider some of the top progressive priorities of the recent past. A ban on assault weapons. Statehood for the District of Columbia. Expansion of the Supreme Court to make room for more progressives. Limits on carbon emissions. A $15 minimum wage. A ban on state voter-ID requirements. An amnesty for illegal immigrants. Measures to increase unionization. The Equality Act. What these policies have in common, besides thrilling progressives, is that they are not on track to become law. Some of them don’t have majority support in a Democratic Senate. None of them has the supermajority support needed to break a filibuster. And the Democrats don’t have a majority for weakening those supermajority requirements, either.

 

The Democratic Party has moved left since 2010, when it last had control of the House, the Senate, and the White House. But it also has much smaller margins in Congress than it did back then, and that fact is doing more to determine legislative outcomes.

 

The Democrats are hardly powerless. The Biden administration can issue regulations — although they will be subject to review by a federal judiciary that is more Republican than the one that greeted the Obama team. The Democrats can confirm judges to try to change that balance. They might be able to raise taxes. Above all, they can spend money.

 

It’s Biden’s record and proposals on spending that have done the most to cement the impression that he is accomplishing more than Barack Obama did. The 2009 stimulus spent $900 billion. The received wisdom among Democrats nowadays is that this number was too small. That’s one reason Biden’s “American Rescue Plan” was $1.9 trillion, even though the argument for macroeconomic stimulus was much weaker this year than it was during the Great Recession.

 

The political constraints on spending have loosened. In part that’s because decades of deficits have not, or not yet, led to the cataclysmic results that were long said to inevitably follow them, such as high inflation and interest rates. The Republican Party, having supported large spending increases under both of its last presidents, has lost both credibility as a proponent of thrift and interest in playing the role.

 

But if large increases in spending were all it took to mark the dawn of a new liberal era, we would have to say that ours began in the last year of Donald Trump’s presidency, which saw $3.5 trillion in federal spending prompted by the COVID pandemic. And even Biden’s spending spree is not quite as great a progressive victory as it seems.

 

It is not, by and large, going to new permanent programs. The spending bill Biden signed sends $410 billion in checks to households. Some conservatives worry that these checks will become addictive for voters and politicians. But they’re not that much different from tax rebates and credits implemented during the George W. Bush and Obama presidencies, which expired rather than moving politics or policy to the left in a lasting way.

 

Another $360 billion goes to state and local governments. Sold, however dubiously, as an emergency response to COVID’s impact on budgets, this aid won’t become a regular expense either. The $120 billion more narrowly related to actual COVID expenses won’t get entrenched once vaccines beat the infection. Expanded unemployment benefits account for another $246 billion. A similar expansion happened under Obama but eventually expired. So will this one.

 

The part of the bill most likely to make a long-term difference is the $143 billion it spends to enlarge tax credits for parents and for low-income workers. Some Republicans have expressed support for permanent enlargements. Some on the left cheer, and some on the right fear, that the bipartisan interest in benefits for children signals the end of welfare reform. Biden’s child benefits go to parents whether or not they take paying jobs, which is said to be a move back toward the pre-reform welfare program.

 

But the new benefits are unlike the old program in other respects. They don’t cut payouts when parents take jobs, get raises, or marry a wage-earner. To make it into permanent law, the benefits will probably also have to be modified to win some Republican support. Senator Mitt Romney (R., Utah) has a plan for a child allowance that eliminates the Temporary Assistance for Needy Families program.

 

Biden has put forward another $2 trillion spending bill, this one in the name of infrastructure, and says yet another spending bill will follow. The current proposal is another result of growing comfort with spending. It will probably be advanced under Senate rules that do not allow a filibuster. A price of using those rules is that the money can’t be spent to create new programs.

 

Democrats want to pay for the bill with tax increases, including a partial reversal of the corporate-tax cut that Republicans enacted in 2017. The Republicans took a tax rate of 35 percent down to 21. Biden wants to move it up to 28. Senator Joe Manchin (D., W.Va.) says that he doesn’t want anything higher than 25, and that other Democrats agree with him.

 

A four-point increase in the corporate-tax rate would leave most of the Republican reduction in place. It would also leave the U.S. with a lower statutory rate than in any year from 1941 through 2017. The Democrats will find other ways to raise taxes, too — they would like to raise taxes on corporations’ overseas income — but this isn’t a top corporate rate that fits the rhetoric we’re hearing about a sharp left turn from the policies of the last 40 years.

 

The Democrats’ agenda is a very progressive one, and Republicans are right to oppose most of it. If Democratic boasting about how far left they are going causes a backlash that impedes their plans and hurts them in the next election, it will serve them right. But the notion that the Left is leaving behind the half measures of the Obama era — making a great leap forward, as it were — is not really true. The first two years of the Obama presidency included, in addition to the stimulus, a permanent expansion of taxes, spending, and regulation in the Obamacare legislation; new regulation of the financial industry; and repeal of the military’s “don’t ask, don’t tell” policy. Biden is not set to achieve anything comparable in his first two years.

 

The first law Obama signed was the Lilly Ledbetter Fair Pay Act, which made it easier for employees to win lawsuits alleging sex discrimination at work. If Biden had to get that law through this Congress, it would be too heavy a lift.

 

Republican strength in Congress puts real limits on how much damage Biden can do — or, if you look at it as progressives do, how much he can accomplish. For Biden to have a freer rein, the Democrats will have to manage to hold the House and win another Senate seat or two in 2022. The transformative, FDR stage of the Biden presidency will have to wait until then. If, that is, it ever begins.