House Adopts $3.5 Trillion Budget Blueprint

The U.S. House of Representatives adopted a $3.5 trillion budget resolution Tuesday after a White House pressure campaign and assurances from Speaker Nancy Pelosi helped unite fractious Democrats to move ahead on the core of President Joe Biden’s economic agenda.

The 220-212 vote puts to rest, for now, an intraparty rift between progressives and moderates that threatened to derail Pelosi’s strategy for shepherding the budget framework and a separate $550 billion bi-partisan infrastructure bill through Congress.

To avoid a showdown on the floor, Pelosi orchestrated Tuesday’s roll call to avoid a direct vote on the budget resolution. Pelosi used a procedural maneuver that deemed it passed once the House adopted a rule governing floor debate for two other measures—the infrastructure bill and voting rights legislation. No Republicans voted in favor of the rule.

“Today is a great day of pride for our country and for Democrats,” Pelosi said on the floor before the vote.

The Senate already cleared the budget resolution on a 50-49 party-line vote. Tuesday’s House vote paves the way for the reconciliation process, in which committees write the details of the budget framework into tax and spending legislation that the House and Senate will vote on this fall. Using reconciliation means Democrats can push it through the Senate without the threat of a Republican filibuster.

Pelosi released a statement committing to passing the separate infrastructure legislation by September 27.

Ten moderate Democrats led by New Jersey Representative Josh Gottheimer had been pushing to pass the infrastructure legislation now. But progressives demanded that the House take up the budget resolution, which encompasses many of their priorities, and hold off passing the infrastructure legislation as leverage to make sure the Senate addresses their priorities.

Representative Alexandria Ocasio-Cortez of New York was among the progressives who warned Tuesday that House leaders must keep their commitment and wait for the Senate to pass reconciliation before they take up the infrastructure bill. “If that is not the case, then they shouldn’t count on us,” she said, emphasizing that the September 27 deadline set in the rule for infrastructure isn’t binding.

House Majority Leader Steny Hoyer told reporters the goal is to pass both bills by the end of September “if we can.” In life, “you don’t necessarily get everything you want at the same time,” Hoyer said. “The U.S. Congress is no different.”

Pelosi’s maneuver, a so-called “self-executing rule,” is typically used by House leaders when they do not have the votes and want to avoid an embarrassing defeat on the floor. Pelosi bet that moderates, who support both the voting rights legislation and the infrastructure package, would be reluctant to vote against the rule advancing those measures. Moderates, however, refused to budge until they received explicit assurances that the House would vote on the infrastructure bill by September 27.

Structuring the budget resolution as deemed passed gives moderates—some of whom are hesitant about the $3.5 trillion price tag—some political cover after their public break with party leaders and progressives in recent weeks. “I think it’s important that those of us who are moderate Democrats make sure that our voices are heard,” Representative Jim Costa of California said. “We’re representing our constituencies.”

The House now is set to pass the voting-rights legislation on Tuesday, but to leave the infrastructure bill until late September.

White House Pressure

Biden and his top aides made calls to moderates and other House Democrats prior to the vote to again emphasize White House support for Pelosi’s strategy and the importance of the budget resolution, the infrastructure bill, and the voting rights legislation, according to officials.

House and Senate committees are already at work trying to craft portions of the spending package that will fill in the details of the budget resolution on climate change, tax hikes on corporations and the wealthy, tuition-free community college, a Medicare expansion, and more. But the dissent among Democrats demonstrates the difficult negotiations Pelosi and Senate Majority Leader Chuck Schumer will face as they try to steer the multi-trillion–dollar legislative package through Congress in the coming weeks.

The budget resolution sets a September 15 deadline for the congressional committees responsible for drafting the tax and spending legislation. That’s a tight timeframe, with lawmakers scheduled to be away from Washington until the middle of the month.

Some moderate Democrats in both chambers have balked at the $3.5 trillion price tag of the spending package, and others have expressed concerns about some of the tax hikes for corporations and high-income individuals that are part of that plan.

“It’s not going to be easy, but we have two things going for us: One is that these provisions represent longstanding Democratic priorities, and secondly they’re wildly popular with the American people according to polls,” Budget Committee Chairman John Yarmuth, a Kentucky Democrat, said.

Congress also faces a collision of crucial deadlines in September. Lawmakers will have to pass a stopgap funding bill to avoid an October 1 government shutdown, and they’ll have to raise the nation’s debt ceiling around the same time to avoid a default on federal payment obligations.

—With assistance from Laura Litvan.

Copyright 2021 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.