Senator Joe Manchin told Democratic leaders Thursday he would not support new spending on climate measures or tax increases, delivering a potentially fatal blow to President Joe Biden's ambitious economic agenda.
The West Virginia Democrat's decision, confirmed by three people familiar with the discussions, comes after more than a year of negotiations and just months before midterm congressional elections that will determine control of both chambers.
Manchin told Majority Leader Chuck Schumer he's only willing to support legislation to lower prescription drug prices and extend enhanced Affordable Care Act subsidies, the people said. That leaves Democrats in a position of accepting a much smaller package shorn of nearly all of their long-term ambitions from a year ago, or getting nothing.
His decision is a de facto veto of Biden's hopes to revive the economic plan that fizzled last year, angering Democratic progressives who had been counting on sweeping policy wins. Manchin's vote is pivotal in the evenly divided Senate, where Democrats need a united caucus to pass the economic package by simple majority under special budget reconciliation rules.
Bad News for Democrats
Just days ago, Manchin and Schumer were negotiating over hundreds of billions in spending on measures designed to fight climate change, including tax breaks for renewable energy, electric vehicles and other clean power sources. The loss of those plans will be a bitter pill for many Democrats on Capitol Hill and at the White House. Solar stocks fell in early U.S. trading.
"I'm not going to sugarcoat my disappointment here," Senate Finance Chairman Ron Wyden of Oregon, who previously talked with Manchin about a package of clean energy incentives, said in a statement. "This is our last chance to prevent the most catastrophic — and costly — effects of climate change."
Other Democrats, including Senator Sheldon Whitehouse of Rhode Island, demanded Biden take executive action to address climate.
"With legislative climate options now closed, it's now time for executive Beast Mode," Whitehouse of Rhode Island tweeted. "Free at last. Let's roll. Do it all and start it now."
Manchin's spokeswoman said political leaders must adjust to "economic realities" that can only further boost consumer prices.
Inflation-Related Issues
"Political headlines are of no value to the millions of Americans struggling to afford groceries and gas as inflation soars to 9.1%," said Manchin spokeswoman Sam Runyon. "Senator Manchin believes it's time for leaders to put political agendas aside, reevaluate and adjust to the economic realities the country faces to avoid taking steps that add fuel to the inflation fire."
The June inflation report this week showing 9.1% annual inflation — the worst in more than 40 years — gave Manchin another opportunity to revive his criticism about federal spending as a driver of surging prices. He also assailed Washington leaders for failing to heed concerns from him and others about inflation for more than a year.
"I was talking about inflation before it was even thought about," Manchin told reporters earlier. "And now I'm more concerned than ever before."
A number of Senate Democrats have said it's critical to get a bill this month that would lower inflation, with prescription drug prices both a politically popular item and one on which they are unified.
Progress had slowed, including on the climate portion and a plan to increase taxes on the wealthy and corporations, before a self-imposed deadline set Schumer to vote on the measure before the August recess.
