Democrat Senator Joe Manchin has expressed that he is strongly opposed to Biden’s plans to fund his $2.25 trillion infrastructure proposal called the ‘American Jobs Plan.’ The Biden administration has proposed raising corporate taxes in America from 21 to 28 percent. Former President Trump had reduced corporate taxes from 35 percent to 21 percent in 2017. In an interview with Metro News, Manchin said that the proposed tax hike is just too much.
“As the bill exists today, it needs to be changed… It’s more than just me, Hoppy… There’s six or seven other Democrats who feel very strongly about this. We have to be competitive, and we’re not going to throw caution to the wind… If I don’t vote to get on it, it’s not going anywhere,” Manchin told the host of “Talkline” in a statement. He said a hike to 25 percent would be supported. The senator feels that anything higher would risk harming the U.S. economy.
Infrastructure plan pushed with budget reconciliation process
Manchin’s statements come as Senate Parliamentarian Elizabeth MacDonough granted Democrats permission to use the reconciliation process for the fiscal year 2021, a move that will allow the party to pass the multi-trillion dollar infrastructure proposal without any Republican support.
Normally, such measures would need a 60 vote support from the Senate to pass the filibuster threshold and get approved. Since the Senate is split 50-50 between both parties, Democrats would need at least 10 Republican senators to support the infrastructure proposal, a highly unlikely event given how the GOP opposes the plan.
Reconciliation allows Democrats to pass the $2.25 trillion plan through a simple 51 vote majority. If the result is a tie evenly split along party lines, Vice President Kamala Harris, as the Senate president, can cast her vote to break the tie.
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The reconciliation process also means that Democrats need all members in the Senate to support the proposal. This is where a single senator like Democrat Manchin can wield his power. If Manchin refuses to support the infrastructure plan, the bill won’t be passed through the Senate.
Biden’s plan to raise taxes has triggered strong criticism from Republican Party members. Former President Trump has called the decision the “largest tax hike in American history” and a radical move by Biden. He warned that the hike in taxes will only cause millions of jobs, thousands of factories, and trillions of dollars in America to shift to other competitive nations.
In an interview with CNBC, Texas Representative Kevin Brady (R) pointed out that any positive impact from infrastructure investment will only be negated by the tax increases. The fact that the tax hike comes amidst a pandemic risks triggering a downturn in the economy and forcing companies to look for opportunities overseas.
“No president has ever raised business taxes to rebuild an economy and then to drive our rates worse than China’s and on par with Syria’s. [At] the end of the day we’re going [to] see slower hiring, we’re going [to] see less investment in the U.S., and I would predict we will see the second wave of U.S. companies inverting or moving their headquarters overseas in the long run.”
“That’s why I think this is such a major mistake… [The tax increases will] make it better to be a foreign company operating in America than an American company, so they are going so far in the wrong direction,” Brady said in the interview.