Manchin and Sinema Are on a Collision Course Over Closing a Tax Loophole for Rich Americans It Could Upend Bidens 790 Billion Deal
Joe Manchin and Kyrsten Sinema are heading toward a collision over closing a tax loophole and it could torpedo Bidens entire 790 billion dollar deal. Because of course it could.
Manchin wants to close the carried interest loophole that lets private equity managers pay lower tax rates. Sinema has defended the loophole because Arizona has private equity interests.
Business Insider detailed the disagreement and its potential consequences.
The carried interest loophole is one of those things that sounds boring until you realize hedge fund billionaires pay lower rates than teachers because of it. Then it makes you angry.
Economic policy often comes down to who has leverage. In a 50-50 Senate each Democratic senator has enormous power.
Manchin and Sinema have frustrated progressives throughout Bidens term by blocking or watering down priorities. This is just the latest conflict.
The deal itself includes climate provisions and healthcare subsidies that Democrats want badly. Losing it over carried interest would be a particular irony.
Negotiations continue as they always do. Whether they find compromise or watch it collapse depends on what each senator values more.
Analysis August 2022
