Democrats should try negotiating with Mitt Romney

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Mitt Romney.
Mitt Romney. Illustrated | Getty Images, iStock

Is President Biden's "build back better" agenda in jeopardy?

It depends on what you mean by the question. I have every confidence that the Democrats in Congress will get their act together to pass some version of their reconciliation bill, however scaled down, along with the infrastructure bill that already passed the Senate with a large bipartisan majority. What, precisely, will be in the bill is harder to say, since the answer depends on the two moderate Democratic Senate holdouts, Joe Manchin of West Virginia and Krysten Sinema of Arizona. That is what's causing so much anxiety among progressives.

Compromise of some kind is inevitable, and clearly preferable to failure. But the bill didn't have to be passed on a partisan basis. If even one or two Republican votes could conceivably have been garnered, there would be more ways through the current impasse, more options for possible compromise. Wouldn't it have been worth it to find out if they could?

I ask that question because back in February, Mitt Romney put forth a bold and generous plan tackling one key area of the bill — the child benefit — that would have sent checks to parents with no questions asked. It was so generous and so simple that many progressive observers argued it was superior to the Biden administration's plan. Its simplicity and universality meant that fewer beneficiaries would fall through the cracks, and it established the important progressive principle that the support was for children, not for the parents. The main progressive objection to the plan had nothing to do with its design, but with how it was paid for: by scrapping a bunch of existing benefits aimed at similar problems and populations.

Romney's argument was that his plan would help more families more efficiently without spending more money. The Democratic view was that it would also leave some working poor people worse off than Biden's plan would and would eliminate programs that were popular and that progressives fought hard for. Rather than consolidate the welfare state by eliminating existing programs, any new initiative should be paid for by taxing the rich and corporations. And at the time, with the economy still struggling to come out from under the stifling blanket of the pandemic the Democratic rejoinder made some sense.

Now, though, the economy is in a very different place. Aggregate demand remains very strong, and inflation is higher than expected even as employment growth has stalled. Supply bottlenecks of various kinds (in energy, in shipping, in semiconductors) remain important drivers of price increases, but a major reason why longer term forecasts for inflation remain relatively stable is the expectation that either fiscal policy, monetary policy, or both will be less stimulative going forward. The market, in other words, is now saying: It's time to shift from goosing demand to improving efficiency.

That shift is in the background of Manchin's objection to the size of the reconciliation bill. But Manchin has other, cultural concerns as well. He wants to pare down the child tax credit to put stiff work requirements in place and to make it more strictly means-tested. That would not only lower the price tag, but would also make the program more palatable to people (many of them working class themselves and therefore potential beneficiaries) who have a moral objection to anyone getting something for nothing.

But these changes would also make the program more complicated and harder for people to access and would create a host of perverse incentives, like incentivizing mothers to pay for child care rather than caring for their own children and amplifying the shock of income loss for beneficiaries who lose a job. And on a fundamental level, they mean turning back on the idea that the support is for children rather than parents. These are among the many reasons why progressives looked so positively on Romney's plan in the first place.

So why aren't they negotiating with Romney as well as Manchin?

The simple answer is that Romney brought exactly one vote to the table. There was no chance that Mitch McConnell was going to partner with Chuck Schumer to enact the entirety of the Biden agenda; that's why those elements that could garner substantial Republican support were hived off into the infrastructure bill. So why talk to Romney when he could only bring the proposal to 51 votes rather than 60, and therefore the proposal still had to be folded into an omnibus reconciliation bill with a host of other priorities that Romney was unlikely to support?

Once again, though, things look different now than they did in the spring. The child benefit is only one area where Manchin has objections; he's also resolutely opposed to the clean energy proposals and is doubtful about both paid family leave and provisions to provide care for the elderly and disabled. Moreover, Sinema has different objections than Manchin, focusing her opposition on the tax hikes and proposals to control drug prices — precisely the sorts of things that Romney would be likely to object to. In that context, it's strange to limit your negotiating partners from the start and give all the leverage — and all the exposure — to two vulnerable members of your caucus. Even if Romney — or Lisa Murkowski, another Republican who is largely exempt from party discipline — couldn't ultimately be brought on board, having additional partners for negotiation might have helped by enabling Manchin and Sinema to calibrate their stances against their moderate Republican colleagues and thereby get to yes.

More important than the Monday morning quarterbacking, though, is the fact that the change in circumstances makes the substance of Romney's proposal more timely. If we're now in a macroeconomic climate where additional stimulus will be immunized by the Fed with asset sales and rate hikes, then redistribution is no longer a free lunch. It now has a cost, one that has to be offset with measures that improve efficiency and/or that expand supply. There are investments in both the infrastructure bill and the reconciliation bill that do the latter — but they don't work quickly. In the meantime, it makes sense to think not only about the total price tag of the reconciliation bill, but about how to make it simpler and more efficient, which is precisely what Romney proposed.

If progressives take seriously their own enthusiasm for a new way of thinking about child welfare, and are cognizant of the change in the macroeconomic climate, shouldn't they give Romney a call?

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