Medicare and paid leave blocking a deal on Biden spending plan

WASHINGTON – As Democratic committee chairs and their aides took up the task Wednesday of writing the legislation to enact President Joe Biden’s mammoth social spending bill, internal divisions over Medicare expansion and paid family leave were among the last remaining hurdles to a final deal, lawmakers said.

This followed a day of apparent progress, during which White House aides huddled with key Democrats on Capitol Hill and Senate Budget Committee Chairman Bernie Sanders, an influential progressive, met privately with Biden at the White House.

Democrats in both chambers expressed optimism that a deal could be reached within days to satisfy its chief opposing factions: The party’s two most conservative senators on one side, and a crucial bloc of House progressives on the other.

Biden is scheduled to depart Thursday for a week of summits in Europe, and it’s no secret that the White House wants some good news to share with the world during his trip.

Yet even as the party appeared united in their goal, several key players in the talks made statements on Wednesday that directly contradicted what other members of the party were telling reporters.

A proposal to create a federal paid family and medical leave system was reportedly dropped from the bill on Wednesday afternoon, according to NBC News, citing sources familiar with the talks.

But the leading advocate for the leave plan, New York Sen. Kirsten Gillibrand, told reporters it was premature to say the leave plan was totally out, saying she intended to speak to West Virginia Sen. Joe Manchin as soon as she could about it.

Paid family and sick leave was a central part of the promise that Biden made during his 2020 presidential campaign to ease the financial burden on working families.

But Manchin sees it as an additional, unnecessary government benefit in the bill, one which raises the overall cost of the legislation.

Another plan to have banks report cash flow information to the IRS for accounts with more than $10,000 in non-wage deposits was dropped from the bill around midday on Wednesday, CNBC’s Kayla Tausche reported.

But on Wednesday afternoon, Rep. Richard Neal, chairman of the powerful House Ways and Means Committee said the bank reporting plan was not being dropped, it was being “reworked” to apply only to people who make more than $400,000 a year.

The invisible line between individuals making under $400,000 a year and those making over that is an important one to Biden. The president has repeatedly pledged that nothing in this bill would raise taxes on people “making less than $400,000 a year.”

Another late-breaking proposal to tax the unrealized market gains of the very richest Americans – people reporting more than $100 million of income or holding more than $1 billion in…