Manchin. It sounds like the name of a Chinese city where a new variant of the coronavirus has emerged. However, it is the last name of a respected US senator. Joseph Manchin, Democrat of West Virginia, is one of the most respected party leaders in the US Senate.
On Sunday night (19), Manchin said something unthinkable by American political standards. He clearly stated that he would vote against Build Back Better, President Joseph Biden’s plan. Also a Democrat, Biden spent his nearly first year in office articulating this economic plan that foresees heavy public spending on social welfare and infrastructure.
One of the most respected voices in the Senate, Manchin was courted by Biden, who made several changes to the bill to please the senator. However, on Sunday night (19), the lawmaker said in an interview with the conservative television network Fox News that the proposal was fiscally irresponsible and that he would not vote for it. “If [os democratas] if they want to take advantage of them, let them put me where they think is best,” he said.
In short, Build Back Better – something like “rebuild better” is a plan that increases spending on a social safety net, something that has never been done in a structured way in the United States. Despite being the country with the largest Gross Domestic Product (GDP) in the world, the United States has never embraced, like many countries in Europe and even Latin America, social welfare policies.
Build Back Better’s proposals – dubbed BBB – are ambitious. There are dozens of measures, initiatives and provisions. They aim to improve the US carbon footprint, reshape their auto industry to use state-of-the-art technologies developed in the US, zero the carbon footprint of power generation by 2035. On the social front, the program wants to renovate 4 million homes and build an additional 1.5 million to reduce the heavy American housing deficit, in addition to maintaining and expanding programs similar to Bolsa Família and the former Family Salary, which provided a subsidy for families with children.
His negotiation was arduous. During negotiations, the total was reduced from US$3.3 trillion to US$1.75 trillion. The plan passed the House of Representatives in November by 231 to 218, with Republican deputies unanimously rejecting the proposal. In the Senate, the situation is more serious. There is a numerical tie between Republican and Democrat senators. Constitutionally, the vice president can vote. Since Kamala Harris is a Democrat, that tip the balance. However, without Manchin’s vote, approval is compromised.
The senator’s criticisms of the program have fiscal origins. According to Manchin, the American Rescue Plan, which offered Americans $300 for each child in the family, is too expensive because it costs $185 billion a year and would be “too popular” to be withdrawn later.
The withdrawal of the vote – and the virtual cancellation of the program – fell like a bomb on the markets, which collapsed on Monday (20). On that day, investment bank Goldman Sachs revised downwards its projections for US growth in 2022 due to the possibility that these expenses will not occur. Expected growth in the first quarter fell from 3% to 2%, that in the second fell from 3.5% to 3% and that in the third was reduced from 3% to 2.75%. Together, the revisions indicate a frustration of 1.75 percentage points in the growth of the American economy next year, with negative effects on the economies of other countries.
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