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Democrats say they've reached agreement on economic package

Democrats say they've reached agreement on economic package


Democratic Senators Kyrsten Sinema of Arizona (left) and Joe Manchin of West Virginia.

Democrats say they've reached agreement on economic package

WASHINGTON — Senate Democrats say they have reached an accord on changes to their marquee economic legislation, clearing the major hurdle to pushing one of President Joe Biden’s leading election-year priorities through the chamber in coming days.

Arizona Sen. Kyrsten Sinema, a centrist who was seen as the pivotal vote, says she is ready to “move forward” on the bill. Senate Majority Leader Chuck Schumer of New York says lawmakers have achieved a compromise that will receive the support of all Democrats in the chamber. His party needs unanimity and Vice President Kamala Harris’ tie-breaking vote to move the measure through the Senate over certain solid opposition from Republicans.

The announcement came as a surprise, with some expecting talks between Schumer and the mercurial Sinema to drag on for days longer without guarantee of success. Schumer has said he wants the Senate to begin voting on the legislation Saturday, after which it would begin its summer recess. Passage by the House, which Democrats control narrowly, could come when that chamber returns briefly to Washington next week.

Democratic infighting had embarrassed Biden and forced him to pare down a far larger and more ambitious $3.5 trillion, 10-year version, and then a $2 trillion alternative, leaving the effort all but dead. Instead, Schumer and Sen. Joe Manchin, the conservative maverick Democrat from West Virginia who derailed Biden's earlier efforts, unexpectedly negotiated the slimmer package two weeks ago.

Sinema said Democrats had agreed to remove a provision raising taxes on “carried interest,” or profits that go to executives of private equity firms. That's been a proposal she has long opposed, though it is a favorite of Manchin and many progressives.

The carried interest provision was estimated to produce $13 billion for the government over the coming decade, a small portion of the measure's $739 billion in total revenue.

It will be replaced by a new excise tax on stock buybacks which will bring in more revenue than that, said one Democrat familiar with the agreement. The official, who was not authorized to discuss the deal publicly and spoke on condition of anonymity, provided no other details.

Sinema said she had also agreed to unspecified provisions to “protect advanced manufacturing and boost our clean energy economy."

She noted that Senate parliamentarian Elizabeth MacDonough is still reviewing the measure to make sure no provisions must be removed for violating the chamber's procedures. “Subject to the parliamentarian’s review, I’ll move forward," Sinema said.