Monday Morning Memo – August 8

Good Morning from Washington, D.C….

After a nearly 15-hour vote-a-rama over the weekend, the $740 billion “Schumer-Manchin” Reconciliation Bill—dubbed the Inflation Reduction Act (IRA) passed the Senate on Sunday morning. Vice President Kamala Harris broke the tie to pass the bill through budget reconciliation by a simple majority, 51-50. This gives the Democrats and Senate Majority Leader Chuck Schumer a major win going into the August recess. Though it is far less ambitious than the original $3.5 trillion Build Back Better Act, the bill contains several large scale investments and key policy victories for Democrats, including $370 billion in investments in clean energy and emissions reductions, the largest climate change package ever to pass the Senate. Read more on what’s in and out of the final bill as well as the final bill text here.

There were only a couple of setbacks for Democrats throughout the amendments proposed in the vote-a-rama, and earlier in the week as the bill underwent its “Byrd Bath.” First, Senate Parliamentarian Elizabeth MacDonough issued guidance that part of a provision that passed the House earlier this year included in the Inflation Reduction Act, which would cap copays for insulin for private insurers at $35 (the cap for Medicare copays remained in the bill), could not be passed through reconciliation, and would need to break a 60-vote threshold to be included in the final package. Democrats forced a vote and in the end 43 Republicans voted to kill the measure (7 voted for the measure, along with every Democrat). Democratic Senator Patty Murray of Washington called the vote “shameful” and said it will force diabetic Americans “to continue rationing their insulin—putting their lives at risk.”

Additionally, Republican Senate Minority Whip John Thune of South Dakota proposed an amendment exempting private equity firms and the businesses they own from the 15% corporate minimum tax (which six Democrats supported) that was adopted over the weekend, dealing a blow to a key revenue offset. However, Democratic Senator Mark Warner of Virginia proposed an amendment to replace part of Thune’s amendment to make it more palatable for Democrats. “It’s not my first choice. But it was all good. On balance this package is so good that I’m not going to nitpick. It is historic,” said Democratic Senator Debbie Stabenow of Michigan.

The process of getting the bill to a vote before the August recess was a key test of the negotiating skills of Senate Majority Leader, and New Yorker, Chuck Schumer. After being left for dead just a few weeks ago, Schumer was able to win the support of two centrists in the Democratic Conference—Senator Joe Manchin of West Virginia, and later, Senator Kyrsten Sinema of Arizona. While Schumer’s agreement with Manchin—which we discussed in last week’s MMM—was a major win, Sinema still remained a major hurdle coming into last week. Sinema said she was “blindsided” by the Schumer-Manchin agreement and had been mostly non-committal about supporting the legislation. However last Friday, Sinema reached an agreement with Democratic leadership and said she was “ready to move forward” on the Inflation Reduction Act. Sinema announced her support after Democratic leadership agreed to remove the “carried interest loophole”—a tax provision targeting wealthy investors—and make additional tweaks to the proposal on the corporate minimum tax.

While he courted Manchin and Sinema, Schumer also held the Left. Democratic Senator Bernie Sanders of Vermont, who had opposed Chips Plus Science just a few weeks ago and proposed several amendments that were struck down over the weekend, voted in the affirmative bringing the Democrats to their critical 50 votes.

The passage of the reconciliation package rounded out a productive week for Senate Democrats—which caps off what was, frankly, a productive summer. On Tuesday, the Senate passed the PACT Act, which would enhance healthcare and disability benefits for the millions of veterans exposed to toxic burn pits 86-11, and on Wednesday, the Senate passed the accession treaty for Sweden and Finland to enter into NATO, 95-1. These come on the heels of the Senate passing the Chips Plus Science Act two weeks ago, and a major gun safety bill in June. Very productive, especially with a 1-vote tie break Majority. 

The field for the midterms came into more focus this week with primaries in Arizona, Kansas, Missouri, Michigan, and Washington. 

Here are a few key takeaways from those races: 

• In Kansas, a referendum to remove protections for abortion—the first since the recent Supreme Court decision to overturn Roe v. Wade—failed. It was a major win for Democrats in a red state, perhaps underscoring voters’ sentiment on the Supreme Court ruling heading into November and sending pundits scrambling for what lessons it may offer, especially on turnout, for November. 

• In Missouri, it was a good night for the GOP, with state Attorney General Eric Schmitt, the National Republican Senatorial Committee’s preferred candidate, defeating embattled former Governor Eric Greitens. For his part, former President Donald Trump tweeted his support for “ERIC” on election night. This basically takes this seat out of play in November, almost guaranteeing a GOP win. 

• In Arizona, it was a good night for Trump Republicans and moderate Democrats, not such a great night for the GOP overall. In the race for Governor, Democratic Secretary of State Katie Hobbs captured the nomination for Governor by a wide margin, and Trump-endorsed Republican Kari Lake defeated Karin Taylor Robson—who was endorsed by much of the GOP establishment, including former Arizona Governor Dough Ducey and former Vice President Mike Pence. Trump Conservatives seemed to do well in GOP primaries across the board setting up, possibly, an easier road for Democrats in the swing state: Blake Masters—who has endorsed a version of the ”Great Replacement theory”—won the race to face Democratic Senator Mark Kelly, and Mark Finchem, a “Stop the Steal” believer won the GOP nod for Secretary of State.  

• In Michigan, Democrats inserted themselves into the GOP Primary, with $435,000 coming from the Democratic Congressional Campaign Committee to boost a Trump-backed extremist—John Gibbs—over incumbent Rep. Pete Meijer, one of ten Republicans who voted to impeach President Donald Trump. Gibbs’ upset of Meijer drew mixed reactions, with many academics saying the precedent set by Michigan Democrats is “dangerous.”

 Back in New York State…

The first public polling possibly shed some light on November. A Siena poll was good, but certainly not great, for Governor Kathy Hochul. The survey found Hochul with a 53-39% lead over Lee Zeldin. A healthy lead for the incumbent, but it is also the third-best performance by a GOP nominee in a public gubernatorial poll in New York in the five elections since Republican Governor. George Pataki last ran in 2002. Interestingly, the poll included questions on Roe v. Wade/abortion rights and gun control (winners for Hochul), but not questions on bail reform/crime and the economy (GOP priorities). 

There are also some notes in key House races from last week: Reps. Carolyn Maloney and Jerry Nadler—who are running against one another in Manhattan’s newly drawn 12^th Congressional District—and progressive challenger Suraj Patel faced off in the first debate in the NY-12 race. Maloney and Nadler were mostly collegial, with a more combative Patel taking the members to task over their past Congressional Records.  Notably, Maloney and Nadler declined to throw their support behind a 2024 run for President Joe Biden, while Patel—who worked in the Obama White House—said the President should run again.

In the crowded race for New York’s 10^th Congressional District—comprising Lower Manhattan, brownstone Brooklyn, Sunset Park, and parts of Borough Park—House Speaker Nancy Pelosi endorsed Rep. Mondaire Jones, who has decided to run in the 10^th rather than his current Hudson Valley district which would have forced him to run against an incumbent and Democratic Congressional Campaign Committee Chair, Sean Patrick Maloney.  Pelosi’s endorsement gives Jones some hope in a crowded race to represent a Congressional District where he only recently moved from the Hudson Valley. In recent polling, Jones currently sits behind former Impeachment Counsel Dan Goldman, State Assembly Member Yuh Line Niou, and New York City Council Member Carlina Rivera in the wide open race.

On the GOP side, the most interesting race remains the contest for Western New York’s 23^rd Congressional District between New York State GOP Chair Nick Langworthy and Buffalo-area developer and former Republican Gubernatorial Nominee Carl Paladino. Throughout the past few weeks, “Lying Langworthy” and “Cowardly Carl”—as they have dubbed each other—have heaved bombs each other’s way. Most recently, Langworthy said Paladino failed to disclose key sources of income by missing the deadline for a key July filing. “His actions aren’t just a walking House Ethics violation, but they should be a huge red flag to voters who are sick of politicians trying to buy elections and hiding their business dealings,” Langworthy said in a statement.

We leave you with a couple pieces of travel advice as you round out your summer: Flying may be chaotic for humans, but it’s even beastlier for their pets. The solution for some: private flights. And, considering taking a cake on plane? Here are some tips for flying with a scrumptious layered dessert.

-Jack O’Donnell   

 

Our podcast is back with Election 2022 analysis. For political insight on this year’s races, including a deep dive on the NYS primaries, listen in here.

 

 

 

 

 

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