Alex Brandon/AP Photo
Sen. Joe Manchin (D-WV) at a news conference on Capitol Hill, November 1, 2021. Manchin would prefer to eliminate some of the programs in the Build Back Better Act.
Senate Majority Leader Chuck Schumer has said that voting on the Build Back Better Act in the Senate would begin the week of December 13, after the completion of discussions with the parliamentarian about what she recommends can stay in the bill. But there’s little of the necessary consensus that would make a final vote successful. Sen. Joe Manchin (D-WV), the human fire extinguisher of the American public’s hopes and dreams, has ping-ponged between allowing passage of BBB by the end of the year and holding off on such a commitment. He’s grabbing at monthly inflation rates and the omicron variant of COVID-19 to justify the delay.
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In reality, Manchin isn’t terribly interested in Build Back Better, and he would prefer eliminating some of its programs. While the energy and climate measures will always be a concern, paid leave in particular has been in his sights. Manchin has said that he would prefer a bipartisan paid leave program, building on some Republican efforts to establish paid family leave in recent years. But in general, the GOP’s ambitions don’t go much beyond a tax credit for employers who offer paid leave. Another Republican idea would force people to raid future Social Security benefits to fund their paid leave.
What Democrats want is more of a universal, mandatory benefit, which Republicans have no interest in doing. What is interesting, however, is that Manchin’s vision of paid leave is most similar to what Sen. Kirsten Gillibrand (D-NY) put out years ago as the FAMILY Act. That would fund paid leave with a small payroll tax on all workers, and workers could subsequently take leave when they needed it.
That’s nothing like the paid leave program in Build Back Better, which is a hodgepodge of funding for state, federal, and employer-based programs, seen as a boon to private life insurers that would manage the benefit for companies. Manchin claims that a Social Security–style paid leave fund wouldn’t be possible through the budget reconciliation process, though that is contested.
Manchin is calling for the simplest, most intuitive way to deliver a federal paid leave benefit, as a universal and public benefit everyone pays into. That’s not the way any of the federal benefit programs in Build Back Better work. If Manchin were actually serious about simplifying social insurance programs and not just raising a pipe-dream option that he knows will fail, I might applaud him. But he seems content to create Rube Goldberg setups in the programs that actually have a chance of becoming law.
There’s another thing that’s worth noting about Build Back Better’s paid leave program. The way it works is that employers can get the government to pay for most of its paid leave benefit, and if they don’t offer it, the nine states (and D.C.) that offer their own paid leave programs would manage it. But in those other 41 states, when an employer doesn’t offer paid leave, the federal government would step in with the benefit, making it truly universal, and not beholden to the whims of conservative states that disfavor social-spending policies.
The paid leave plan has many demerits—if enacted, it would be a clumsy, bureaucratic mess, and private companies would have an opportunity for extracting a lot of the money—but at least every working American would be covered. (In theory, anyway: The proposal excludes the lowest-paid earners in the workforce, as well as those who have no earnings, which could exclude as many as 1 in 3 new mothers.)
That is not true of any other family care program in Build Back Better, creating a true irony: The programs likely to pass in a reconciliation bill will be reliant on Republicans to implement, while the program likely to be cut would not, as long as Democrats are in the White House.
It’s been well documented that the pre-kindergarten and child care subsidy programs in Build Back Better require sign-off from the states. Essentially, the states would have to set up the architecture for their own pre-K and child care programs, and then fund a portion of them.
We literally just went through this with the Affordable Care Act, after a Supreme Court ruling made it easier for states to refuse to adopt the Medicaid expansion. The expansion is a far better deal for states than anything in Build Back Better; recent changes from the American Rescue Plan literally give states more than it would cost to implement. And still, more than ten years after passage, 12 states have not accepted the Medicaid expansion.
By basing policy on promises of partial federal support rather than establishing a federal program, Build Back Better dooms its ambitions to the prerogatives of Ron DeSantis, Kristi Noem, and other GOP governors and legislators.
For two reasons, it’s very likely that many more states would hold off on setting up pre-K and child care. First, the federal match is lower; while the government will cover more than 90 percent of the cost of Medicaid expansion, with child care that tops out at 90 percent after a ramp-up, and with pre-K it’s only 63 percent in the final year. In both cases, states get far less than that in the first three years. The second reason states would hold off is that the programs, unlike Medicaid expansion, are temporary. No state legislature would be thrilled about setting up an entire framework for social spending, when the federal share is not guaranteed after six years.
And that’s even before you get to the ideological rigidity Republicans have against social spending in general. Several states denied a better deal on Medicaid expansion, and earlier this year 25 states refused to extend enhanced unemployment benefits paid for entirely by the federal government, on the grounds that it was disincentivizing a return to the workforce. (This wasn’t true.) The idea that Republican-run states will bend over backwards to help out Joe Biden’s signature legislative initiative, when they might get stuck having to pay for all of it, is fanciful. Indeed, just this week, Republicans in several states told The Washington Post that they would be disinclined to vote to approve a pre-K program.
It’s been less discussed, but Build Back Better’s at-home care program also relies on the states. The bill offers $150 billion over a decade to support increasing access to home care for elderly people or people with disabilities, and raising wages for home care workers. But home care funding generally is provided through Medicaid, where states must participate to set up programs. As former Prospect contributor Sara Luterman, now at The 19th, writes, “If state legislatures need to cut costs, optional Medicaid programs are often first on the chopping block … states with lower tax income per capita, such as Georgia or Alabama, are more likely to opt out of expensive optional programs.”
By basing policy on promises of partial federal support rather than establishing a federal program, Build Back Better dooms its ambitions to the prerogatives of Ron DeSantis, Kristi Noem, and other GOP governors and legislators. It’s simply incredible that, after the Medicaid expansion experience, Democrats would design their programs in this way. Yes, it saves money to require a state match, but that’s not a good excuse for designing programs that may never see the light of day. Meanwhile, Democrats did figure out with paid leave to have a federal backup to implement the program if states won’t. But that’s the one family care program that’s most likely to not survive Joe Manchin’s hatchet.
If paid leave does go down, one option for using the $200 billion that program costs would be to create federal backstops for the other family care programs. Like with the federal Obamacare website, this would serve as a backup option to enroll private pre-K or child care centers in various states into a federally funded program, or to directly fund home care workers within a federalized portion of Medicaid.
Otherwise, Democrats would really be overpromising that they’re creating a universal family care benefit that people in dozens of states are likely to never see. Overpromising is a problem throughout Build Back Better—another example is the “insulin cap,” which is really a cap on co-payments through insurance, doing nothing for people without insurance who cannot afford insulin (the majority of preventable deaths due to rationing insulin come from the uninsured). Failing to deliver a promised benefit is completely toxic; Democrats and advocates should do whatever they can to prevent that.
