$1400 Support Eligibility Reduced... Biden Stimulus Bill More Likely to Pass Senate

President Joe Biden of the United States [Image source= EPA Yonhap News]

[Asia Economy Reporter Park Byung-hee] The likelihood of U.S. President Joe Biden's large-scale economic stimulus package passing the U.S. Senate has increased significantly. This is because the Democratic senators have prepared a new compromise plan to quell internal opposition within the party.

According to Bloomberg and other sources on the 3rd (local time), the Democratic senators decided to narrow the scope of households eligible for the $1,400 support, and both President Biden and Senator Joe Manchin, known as the most conservative Democrat in the Senate, expressed support for the plan.

Earlier, the House of Representatives passed Biden's stimulus plan as originally proposed on the 26th of last month. However, the original plan included a proposal to raise the federal minimum wage to $15 per hour, which faced opposition not only from Republicans but also from Democrats such as Senator Manchin, making it impossible for the bill to pass the Senate.

In response, President Biden met with nine Democratic senators at the White House earlier this week to seek ways to pass the bill. Following the decision to exclude the previously contentious minimum wage increase, further detailed adjustments were made on the 3rd.

According to the new agreement, the eligibility for the $1,400 support will be narrowed. Under the revised plan, the support will be limited to individuals with an annual income of $80,000 or less and households with a combined income of less than $160,000. The original eligibility criteria were individuals earning less than $100,000 and households earning less than $200,000 combined. Under the new plan, individuals earning more than $75,000 annually and households with combined incomes over $150,000 will receive less than $1,400. This reduces both the scope and amount of support for high-income earners.

Kyle Pomerleau, an analyst at the American Enterprise Institute (AEI), stated, "Nearly 9 million households are expected to not receive the $1,400 support."

Regarding unemployment benefits, the original amount of $400 will be maintained. Initially, Senator Manchin had requested to reduce the support amount to $300.

Senator Manchin expressed satisfaction with the narrowed eligibility for the $1,400 support and stated that he would no longer demand further amendments and would support the bill.

With Senator Manchin, who had been the strongest opponent of Biden's stimulus plan among Democratic senators, now expressing support, the Democrats have increased their chances of securing unanimous approval from all Democratic senators.

Currently, the U.S. Senate consists of 50 Republicans and 48 Democrats. Additionally, two independent senators lean Democratic, effectively creating a 50-50 split. In such a scenario, the Democrats can secure a majority by adding Vice President Kamala Harris's tie-breaking vote.

Although 60 votes are generally required to pass a bill in the Senate, the Democrats can pass the bill with a simple majority by using the budget reconciliation process. While the Republicans are expected to propose a new stimulus plan later this week, if the Democrats can maintain party unity, they can create conditions to pass the stimulus package without Republican consent. In this regard, the Democratic side has stated that the Congressional Budget Office and the Joint Committee on Taxation are reviewing whether the budget reconciliation process can be applied to the stimulus plan.

Since the bill has been amended, the newly negotiated bill will be sent back to the House after Senate floor debates, and after the House vote, it will return to the Senate for a final vote.