Why one senator just blew up Joe Biden's presidential plans

A single U.S. senator detonated a political bombshell by refusing to back the U.S. president's Build Back Better bill. The wide-ranging blast radius has touched his political party, his country, and his planet. Let's sift through the wreckage and look at the effects of Sen. Joe Manchin's decision.

Sen. Joe Manchin's decision not to back the Build Back Better bill could have a profound impact

U.S. Senator Joe Manchin, seen leaving the U.S. Capitol last week. He's now upended the entire Washington agenda, insisting the Build Back Better plan be reset. (Elizabeth Frantz/Reuters)

A single U.S. senator has detonated a political bombshell whose wide-ranging blast radius has touched his political party, his country and his planet.

Let us sift through political wreckage over the horizon and count the effects unleashed by Sen. Joe Manchin of West Virginia.

He has, until further notice, killed President Joe Biden's hope of signing major legislation. Resurrecting the Build Back Better mega-bill could happen but it won't be easy and it's dead in its current form.

That time of death was Sunday, 9 a.m.ET. The place and cause? An interview on Fox News in which Manchin said he's done negotiating this bill.

Because he holds the 50th vote in a 100-seat Senate, Manchin's statement was a game-changer on multiple fronts.

It's rocked Biden's presidency, enraged the Democratic Party, imperilled about two dozen major initiatives affecting millions of Americans, undone economic forecasts, torched the U.S. climate plan, tossed into doubt a global tax plan, and, perhaps to Canadians' benefit, paused a major Canada-U.S. irritant, a potential violation of trade agreements.

His move unleashed recriminations within the Democratic Party as some of Manchin's colleagues castigated him; questioned his integrity; said he couldn't be trusted; and some even raised money in fundraising letters trashing his decision.

WATCH | How Manchin's move affects Canada:

Canada ‘well served’ after senator pulls support for Biden social spending bill, trade group says

2 years ago
Duration 2:05
Canadian automotive trade groups are praising Democrat Senator Joe Manchin after he pulled his support for a nearly $2-trillion social spending bill that’s a cornerstone of the Joe Biden presidency. The bill contains an electric vehicle tax provision that Canada's automotive industry says would threaten jobs.

That acrimonious climate is hardly propitious to getting Democrats back to the negotiating table to try saving bits of the 2,468-page Build Back Better bill.

Why would a Democrat do this? 

Why would a Democrat do this to his party's agenda? It's worth first acknowledging the old Washington adage that all politics is local.

There's no evidence any of this will hurt Manchin at home in West Virginia should he choose to seek re-election in 2024. 

On the contrary: In Manchin's part of the country, it can be excellent politics to be seen antagonizing, thwarting and frustrating progressive Democrats. 

His state can barely stand national Democrats, and it's a near-miracle it elected one in Manchin, a well-known former governor. The state's other federal Senate seat went Republican last year by 43 points.

So when Manchin was asked about threats from Democrats in a West Virginia radio interview on Monday his response, in effect, was: Bring it on. 

U.S. President Joe Biden is shown promoting the Build Back Better plan at a GM electric-vehicle plant eligible for tax credits in the bill. Now in peril, the bill would have invested massively in clean technology and was the heart of Biden's climate plan. (Jonathan Ernst/Reuters)

Democrats from Sen. Bernie Sanders to Senate Majority Leader Chuck Schumer have threatened to bring the bill for a vote anyway and dare him to vote against it.

"Bernie, please put it on the floor," Manchin said in an interview with a West Virginia radio station.

"Maybe it'll sink in that we have to look in a different direction than this far-reaching social agenda of yours."

'I'm not a Washington Democrat'

Manchin said: "I'm not a Washington Democrat."

Might some Democrats want him out of the party? Hey, that's no big deal, either. Manchin was asked whether they might force him out and make him run as an independent. 

To be clear: Most Democrats do not want this. 

They almost certainly need him more than he needs them. To be more specific, they need his crucial vote, which they still get on other legislation. They also need him to control the chamber and its investigative committees. They need his help confirming judges.

Progressives are livid with Manchin:

Manchin, meanwhile, hardly sounds perplexed by the prospect of being pushed out. He said he'd like to believe there's still room for centrist non-progressives like him in his party and if there isn't: "Then they'll have to push me wherever they want me."

It's not necessarily over for this bill. Manchin has said he wants to try starting over. He's reportedly had a cordial chat with Biden where they agreed to revive talks in the new year to try salvaging some sort of legislation.

What Manchin wants

Manchin has said he wants to: 

  • Adjust the tax code and undo some Trump-era tax cuts that helped the wealthy.
  • Reduce drug prices.
  • Set stricter conditions on a child-poverty credit. Namely, a work requirement for parents and an income limit so the wealthy don't qualify.
  • Revise the environmental part of Build Back Better. A former fossil-fuel executive with deep financial ties to the industry, Manchin complains about parts of the party's green agenda. 

But it's unclear what changes he'd demand. On Monday, he said people earning $500,000 US a year shouldn't be getting a tax credit to buy an electric vehicle.

None of this will be easy. For any change to appease Manchin, Democrats risk losing others' votes.

In the meantime, it's a miserable end to the year for Democrats.

Biden's popularity has plummeted, his legislative agenda is stalled, COVID-19 is back with a vengeance, and the polls are grotesque-looking ahead of next year's midterms. 

A silver lining for Canada? Prime Minister Justin Trudeau, seen here at the White House last month, and his government were worried about one element in Biden's plan. They still are. (Jonathan Ernst/Reuters)

Democrats now fear they'll have little to show for this rare moment where they control Congress and the White House.

That's the immediate effect on the Democratic Party: More demoralized and divided.

Beyond that, Manchin's move could touch tens of millions across the U.S. who would have been affected by the policies in this giant bill.

The effect on millions of Americans

There are the macroeconomic effects, with Goldman Sachs cutting one percentage point off its growth forecast for the U.S. for the first quarter next year after Manchin's move.

Then the individual effects. 

The Build Back Better bill passed by the House of Representatives offered paid parental leave for a country that lacks it, universal preschool, cheaper child care for 20 million children, lower costs for some drugs including insulin, savings for families using the Obamacare health system, and funding for one million affordable homes.

Researchers at Columbia University also said a new universal child tax credit, inspired in part by Canada's, cut child poverty this year by more than one-third.

Millions of families benefited from that $300-a-month credit passed during the pandemic, but that credit is about to expire this month. 

It would have been extended under Build Back Better.

One Boston medical network said it's seeing fewer children come in suffering from malnutrition and stunted growth.

"[I'm feeling] profound disappointment," Allison Bovell-Ammon, director of policy strategy at Children's HealthWatch, a research group at Boston Medical Center.

"This is potentially pushing millions of children back into poverty.… We cannot understate the negative consequences of this inaction."

Reporters have been trailing Manchin around the Capitol for months, as seen here Sept. 30. He's considered the 50th Democratic vote in a 100-seat Senate and can decide what legislation lives or dies. (Leah Millis/Reuters)

The $1.75-trillion US legislation would have been funded through tax changes, such as a minimum tax of 15 per cent on the foreign profits of U.S. corporations abroad.

Several international effects

That was going to implement an international agreement to combat corporate profit-shifting to no- and low-tax jurisdictions.

As for other international effects, this was the heart of Biden's effort under the Paris accord to reduce U.S. carbon emissions by 50 to 52 per cent.

It offered rebates for installing solar panels or buying an electric vehicle and loans and tax credits for low-carbon industrial projects.

A Princeton energy-policy researcher, Jesse Jenkins, said the failure of this bill would not only risk those efforts but undermine U.S. companies in the race to transition to a clean economy.

"The stakes here are incredibly high," Jenkins said in a statement. "Failure would cost Americans dearly."

What it means for Canada

There's a silver lining in all this for Canada.

The Canadian government was deeply worried about the green rebates and preparing for an economic war over them

That's because Build Back Better offered tax credits for the purchase of U.S.-assembled electric cars, which Canada and others called a violation of trade agreements that would kill jobs abroad.

It's no accident a Canadian auto-parts representative happened to be meeting with Manchin's staff on Friday, lobbying against the measure.

Flavio Volpe said it's too soon to assume this irritant is gone. Ottawa appears to agree. Nobody in the Canadian government has been willing to comment on Sunday's developments, suggesting they're not final.

"I don't feel like we're out of the woods yet," Volpe said. "We're [still] on DEFCON 1 for Canadian prosperity."

He did offer one clear takeaway from recent meetings with U.S. senators and with Manchin's office.

He said he emerged with a better understanding of this singular moment in American political history: where one West Virginia lawmaker wields the power to end a historic opportunity for his party, and upend the governing agenda of the United States.

With files from Katie Simpson

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