A new Treasury Secretary Confirmed.
Yellen confirmed as Treasury chief with more economic aid at top of agenda. Victoria Guida, Politico.
"The Senate on Monday voted overwhelmingly to confirm Janet Yellen as Treasury secretary, putting her in a pivotal role to shepherd the flagging economic recovery as the coronavirus pandemic continues to take its toll on the country.
Yellen's first task will be to work with Congress to advance President Joe Biden’s plan for a new $1.9 trillion economic-stimulus package, amid concerns among some lawmakers about the growing debt."
With Secretary Yellen confirmed, what can the democrats do with a slim majority in the Senate? Some suggest tax legislation can pass, via "reconciliation", with a simple 51 vote majority. Eide Bailly's own Jay Heflin (reporting from our DC office) breaks down how the "reconciliation" process can work.
"In short, reconciliation instructions make it easier to pass legislation from Congress.
Reconciliation instructions are included in budgets. It is important to note that not all budgets include these instructions.
The House and Senate must approve a budget that includes reconciliation instructions for Congress to adhere to those instructions, which provide guidelines to committees on how to craft legislation.
Once that legislation is created, it only takes a simple majority to pass it from both chambers of Congress. Without the protections that are provided by reconciliation instructions, it would normally require 60 votes to pass the Senate, which can be hard to accomplish.
Reconciliation instructions are also limited in how they can be used. They must address federal spending, taxes, or the federal debt limit. This means that proposals must affect at least one of these three areas to be included in a reconciliation bill.
For example, Biden’s proposal to increase to the Child Tax Credit to $3,000 ($3,600 for a child under age 6) for each child 17 and younger, and make it fully refundable, would likely fit within the confines of reconciliation and be included in legislation that would require a simple majority to pass the House and Senate.
On the other hand, the president’s proposal to increase the minimum wage to $15.00 an hour or postpone evictions will likely not affect federal spending, taxes, or the federal debt limit and therefore will likely not be included in a reconciliation bill. These measures might require 60 votes to pass the Senate.
Reconciliation instructions stem from concerns in the 1970s that federal deficits were growing out of control. To make it easier for Congress to approve hard-to-pass legislation that would lower deficits, either through spending cuts or tax increases, reconciliation instructions were created.
Since their creation, however, lawmakers have used them to lower taxes, which has increased deficits."
Jay further explains how this may all play out in the coming months.
"Officials in the Biden Administration continue to negotiate with Senate Republicans in an attempt to reach a compromise on additional COVID-19 relief. If an agreement cannot be reached, Democrats may end up using the budget reconciliation process to enact legislation on a party-line basis and have begun taking the steps necessary for that to occur. This development should not be taken as an abandonment of bipartisan negotiations, but does indicate willingness to push COVID-19 relief legislation through Congress should negotiations fail.
House Budget Committee Chairman John Yarmuth (D-Ky.) is drafting a budget that is expected to include reconciliation instructions for President Biden’s $1.9 trillion rescue plan, which seeks to increase to the Child Tax Credit to $3,000 for each child 17 and younger ($3,600 for a child under age 6), and make it fully refundable.
The budget could be voted on in the House as early as next week. The Senate is expected to vote on the budget shortly after House approval. In both chambers, a simple majority is required to pass it.
The president does not sign a budget into law, so congressional approval is the last step in making the budget an enforcement mechanism on Capitol Hill."
Finally, Jay offers several possible paths forward.
"President Biden has consistently stated that he would like bipartisan support in Congress for his rescue plan. If reconciliation is used to advance his proposals through Congress, it will likely mean that passage from both chambers will be partisan, i.e., Democrats will support it while Republicans oppose it.
However, without using reconciliation, Senate Democratic leaders would have to entice ten Senate Republicans to support the rescue plan, which is unlikely to occur unless significant changes are made during negotiations.
Senate Minority Whip John Thune (R-S.D.) has cast doubt on the package amassing 60 votes. Several Senate Republicans have argued against the bill, saying that it spends too much money and comes too soon after Congress’ $900 billion stimulus package from last month.
Should negotiations fail, Biden’s only option to enact his rescue plan might be reconciliation, which can be time consuming. As Biden would like to enact his rescue plan before mid-March when extended unemployment benefits are currently set to expire, the time for negotiations may be short in order to allow sufficient time for the budget reconciliation process to occur.
A budget must first be approved by the House and then the Senate before any committee can draft a reconciliation bill. Once that bill is drafted, it could be subjected to hearings or markups, or both, all of which can be time consuming.
This process could take weeks, if not months, especially since the Senate will begin its impeachment trial of former-President Donald Trump the week of February 8, 2021, another time-consuming procedure."