More Debt Ceiling Drama Ahead?

Plus, Biden pitches lower drug prices to sell his agenda ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ [The Fisc](   By Yuval Rosenberg and Michael Rainey Happy Monday! Congress last week tackled what should be the easiest part of its daunting December to-do list, keeping the lights on at key federal agencies by extending funding through mid-February — and, despite some brinkmanship, lawmakers managed to avert the potential shutdown with a whole day to spare. Now comes the harder stuff, namely addressing the debt ceiling and a contentious, long-delayed annual defense bill. Lawmakers will also look to prevent Medicare reimbursement cuts from automatically kicking in on January 1. Oh, and Senate Democrats are still pressing to pass their Build Back Better bill before Santa Claus comes to town, though some on Capitol Hill reportedly think they’ll have to wait until the new year. Here’s what to watch this week. Pushing Build Back Better Plan, Biden Calls for Lower Drug Prices Looking to drum up support for his sweeping social investment plan, President Joe Biden on Monday called on lawmakers to strike a blow against high drug prices by passing the Build Back Better Act, the roughly $1.7 trillion spending package that includes provisions to reduce the cost of some prescription medications. "There aren't a lot of things that almost every American can agree on, but I think it's safe to say that all of us ... can agree that prescription drugs are outrageously expensive in this country," Biden said at the White House. "Shame on us as a nation if we can’t do better than this," he added. Making his pitch for his spending plan, Biden said, "It doesn't need to be that way. Under my Build Back Better bill, which has passed the House of Representatives, it won't be the same way." The Build Back Better plan would empower Medicare to negotiate lower prices for some of its costliest drugs, and cap out-of-pocket spending on drugs at $2,000 per year for those in the universal health plan for those 65 and older. It would also cap out-of-pocket expenses for insulin at $35 per month for those covered by Medicare or private insurance plans, though the provision would not take full effect until 2023. The plan in the Senate: Almost a week into December, Senate Majority Leader Chuck Schumer (D-NY) said Monday that he wants to get the pass the Build Back Better bill on Biden’s desk before Christmas. In a letter to colleagues Monday, Schumer laid out the procedural steps he plans to take over the next two weeks. "On Friday and Saturday, 8 of the 12 Senate committees that were given Reconciliation instructions submitted their final Senate text to the Parliamentarian, the Congressional Budget Office and the Senate Republicans," Schumer wrote. "Our goal is to finalize the remaining committees over the course of this week and next." Once the text of the bill is complete, it will undergo a "Byrd bath" – a formal review (named for former Sen. Robert Byrd) by the Senate parliamentarian, who checks to ensure that each provision within the legislation meets the requirements of a budget reconciliation package. A crowded calendar: Schumer noted that lawmakers have other important issues to deal with in the coming days, including the debt limit, the annual National Defense Authorization bill and voting rights legislation. The timetable appears to be extremely tight, especially with Republicans vowing to oppose parts of the bill. "A lot of their agenda should be voted out because it won’t meet the requirements of having a direct impact on spending and revenues," Senate Minority Whip John Thune (R-SD) told Politico. One Democratic aide said the parliamentarian’s office could be a "chokepoint" that could delay the bill, according to The Hill. Other potential delays include the likelihood that lawmakers will make major changes to the bill, including the treatment of the state and local tax deduction, and the possibility that conservative Democrats like Sen. Joe Manchin (D-WV) may prefer to hold the bill until economists get a better read on the state of the economy, especially inflation. Recognizing how little time is left in the year, Schumer advised his colleagues to prepare for an intense workload. "I will continue to remind you that there are more long days and nights, and potentially weekends, that the Senate will be in session this month," Schumer said. Congress Set for Another Week of Debt Ceiling Drama Congressional leaders reportedly have been considering attaching a measure to address the debt limit to the massive annual defense policy bill that been held up by clashes over provisions related to Russia and China. After failing to advance the National Defense Authorization Act, the Senate is now set to abandon efforts to pass its own version of the bill, Politico [reports](. Instead, the House will put together a compromise version of the bill negotiated by congressional leaders and the House and Senate Armed Services committees, reportedly as early as today, with plans to pass it later in the week. "The final bill will likely endorse a $25 billion increase to President Joe Biden’s defense budget, a major boost that Democrats and Republicans approved in both chambers," Politico notes. Linking the debt limit and the defense bill may not work, though. House leaders made clear last week that securing the necessary votes would be difficult, given that Republicans won’t support raising the debt limit and progressives object to boosting the defense budget. "I don't think that would pass," House Minority Leader Kevin McCarthy (R-CA) said last week about addressing the debt limit via the defense bill. "Democrats who are fans of [linking the bills] hope a mix of defense-minded GOP hawks loath to oppose any defense bill, and more moderate Republicans eager to avoid default, could compensate for any progressives they lose on the vote," Politico’s Playbook [reports](. "They also acknowledge that this proposal could fall totally flat, leaving them scrambling to find another move this week." The bottom line: House Majority Leader Steny Hoyer (D-MD) says the House will address the debt limit this week. On the Senate side, Majority Leader Chuck Schumer (D-NY) and Minority Leader Mitch McConnell (R-KY) have been quietly discussing a path forward on the debt limit. "The two haven’t been out there bashing each other or making demands on the issue the way they were a few months ago. Notably, McConnell hasn’t been heard lately insisting Democrats need to use reconciliation to address it," Politico notes. "Perhaps that’s a good sign, but good feelings alone won’t get the job done." --------------------------------------------------------------- Send your feedback to yrosenberg@thefiscaltimes.com. And please tell your friends they can [sign up here]( for their own copy of this newsletter. --------------------------------------------------------------- News - [Biden Points to Drug Prices in Call for Senate Social Spending Vote]( – The Hill - [‘I Need a Budget’: Pentagon Officials Thrash Congress Over Gridlock]( – Politico - [A Compromise Version of the Annual Defense Bill Could Drop Anytime Now. Here Are 5 Things We're Watching for.]( – Politico - [Bipartisan Duo Offers Way Out of Debt Limit Stalemate]( – Roll Call - [Vulnerable Dems Urge Congress to Preempt 2022 Medicare Cuts]( – Axios - [Big Companies Look to Senate to Ease Budget Bill’s Minimum Tax]( – Roll Call - [Democrats Ramp Up Talks With Parliamentarian on Biden Spending Bill]( – The Hill - [New Democrat Coalition Chair: Senate Should Pass Bill Before Expanded Child Tax Credit Expires]( – The Hill - [How Stephanie Murphy, a Holdout on Biden’s Agenda, Helped Salvage It]( – New York Times - [High Inflation, Falling Unemployment Prompted Powell’s Fed Pivot]( – Wall Street Journal - [How the Supply Chain Crisis Unfolded]( – New York Times - [New York City Sets a Sweeping Vaccine Mandate for All Private Employers]( – New York Times - [Pro-Trump Counties Now Have Far Higher COVID Death Rates. Misinformation Is to Blame]( – NPR - [Inside the Growing Alliance Between Anti-Vaccine Activists and Pro-Trump Republicans]( – NPR Views and Analysis - [Look at Build Back Better’s Benefits, Not Its Price Tag]( – Alan J. Blinder, Wall Street Journal - [Republicans Will Never Help Democrats Avoid a Debt Ceiling Crisis]( – Patrick Caldwell, New Republic - [Say It Loud, Democrats: Economic Issues Are ‘Values’ Issues, Too]( – E.J. Dionne, Jr., Washington Post - [Do Taxpayers Have to Fund Religious Education? The Supreme Court May Say Yes]( – Rachel Laser, Washington Post - [America’s Covid Rapid Test Plan Is Appallingly Inadequate]( – Natalie Shure, New Republic - [The Great Labor Market Shakeup]( – J. Bradford DeLong, Project Syndicate - [To Save Our Healthcare System, We Must Think Beyond Doctors and Nurses]( – Jehan El-Bayoumi, The Hill - [The Omicron Variant Is Another Excuse for Government Meddling]( – Benjamin Powell, The Hill - [Biden Can Do Better on Covid]( – Ross Douthat, New York Times Copyright © 2020 The Fiscal Times, All rights reserved. You are receiving this newsletter because you subscribed at our website or through Facebook. The Fiscal Times, 399 Park Avenue, 14th Floor, New York, NY 10022, United States Want to change how you receive these emails? [Update your preferences]( or [unsubscribe](