Sen. Chris Coons on Joe Manchin, Dem Breakthrough on Climate

SARA SIDNER, HOST: With inflation wreaking havoc on so many citizens’ lives, as we have just discussed, Senate Democrats have reached an agreement, as you just heard there from Rana, to kick-start President Biden’s long-stalled economic agenda. U.S. Senator and close Biden ally Chris Coons played a key role in advancing those talks. He joins Walter Isaacson to discuss the new deal and its potential to survive the congressional gauntlet.

(BEGIN VIDEOTAPE)

WALTER ISAACSON, CORRESPONDENT: Thank you, Sara. And, Senator Chris Coons, welcome to the show.

SEN. CHRIS COONS (D-DE): Thanks. Great to be on with you, Walter. Good to see you again.

ISAACSON: So it’s a big day to day. We seem to have an agreement between, Senator Manchin, Senator Schumer and the Democratic Party on a reconciliation bill that will do everything from reduce the deficit and take on climate change, drug prices. Let’s start with climate change. Tell me what’s in that bill and why — how that worked out.

COONS: Well, so, there’s a whole lot in this bill. And you’re right. It tackles many of the core challenges the American people are facing, prices at the pump, prices at the prescription drug counter, and the prices for health care. But it also will invest $369 billion in combating climate change. How big a deal is this? It’ll cut our emissions by 40 percent in the next eight years. It’ll provide incentives for new technologies like green hydrogen. It’ll provide technology incentives for investments in things like carbon capture and sequestration. It’ll help strengthen our grid. It’ll create high-quality U.S. manufacturing jobs, and it’ll help accelerate the adoption and deployment of technologies like electric vehicles across our country.

ISAACSON: Do I get a little rebate or something if I buy an electric vehicle now?

COONS: Yes, you do. I believe it’s $7,500 for a new one that has significant components from North America. And I think it’s $4,000 for buying a used one. The other thing we just did, Walter, is pass a significant semiconductor chip bill. We just passed that out of the Senate yesterday that would invest $52 billion in onshoring, in bringing back to the United States the manufacturing of cutting-edge semiconductors. Why do these two things connect? Because one of the reasons it’s been hard to buy used cars, to buy a whole lot of different things is because of a shortage of chips. So we are dealing with both of these pressing issues in these two major bills.

ISAACSON: But there’s a big difference between these two bills. You’re somebody who has always been able to walk — work across the aisle to get bipartisan support. For the CHIPS bill, this semiconductor bill you talked about, there are a lot of Republicans support. Why was it impossible to get any Republican support for the climate and deficit reduction bill?

COONS: Because the way we raise the money to pay down the deficit, $300 billion, and to invest $369 billion in climate and extend the Affordable Care Act subsidies, is by allowing Medicare to negotiate prescription drug prices for the first time ever and by closing some of the tax loopholes that were created in the Trump tax bill in 2017. I will remind you, Walter, that 2017 tax bill also passed with only one- party support, in that case, Republicans. And it reduced taxes, particularly for the very wealthiest Americans and the most profitable companies. This bill includes a few things, like a 15 percent minimum tax, so that all corporations, particularly corporations over a billion dollars in revenue, pay some tax. President Biden has a longstanding commitment that people making under 400,000 won’t have their taxes increased. That was also one of the key provisions. Why did we get no Republicans on this reconciliation bill? It negotiates prescription drug prices down, and it raises tax rates on the very wealthiest Americans and most profitable corporations.

ISAACSON: Are you sure that you’re going to be able to get this passed? Senator Sinema hasn’t yet come out for it. Have you talked to her?

COONS: I have. And, Walter, I got to tell you, nothing’s done until it’s done here in the United States Senate. There are of course, going to be a lot of efforts to try and amend this package one way or the other. We have been in negotiations around this once-a-year 50-vote margin reconciliation package for a long time. And I am optimistic we can get this passed next week. But, of course, don’t count your chickens until they hatch.

ISAACSON: One of the big things you mentioned just briefly was the minimum corporate tax. That’s not just something affecting the United States. It was something that was negotiated by our Treasury secretary, Janet Yellen, and many other countries to say, let’s do this, so companies can’t hop around to different places. They will face at least a minimum tax around the world. That would seem like something that would have large bipartisan support. Does it?

COONS: You would hope so. As of now, it doesn’t. But that was a significant accomplishment of the Biden administration was to globally negotiate a base rate for corporate tax, so that tax havens, places where corporations have been able to shelter their assets and to avoid taxation for a long time, have come into a global agreement that we’re going to have a basic tax rate worldwide.

ISAACSON: So it’s pretty much of a surprise to those of us who woke up and read about this, because Senator Manchin had been against some of these provisions. How did this fall into place?

COONS: Well, first, Senator Manchin never gave up. When there was a sort of a blowup and a walk-away more than a week ago with, Senator Schumer, Senator Manchin kept saying to many of us privately who reached out to him that he wasn’t done negotiating and he was still willing to come to the table. His key issue was being reassured that this was not going to be inflationary. He’s very concerned about inflation. And that’s partly why the title of this bill and one of the main areas of focus of this bill is combating inflation by paying down our deficit by $300 billion. I happened to be this past weekend in a place you know well, Aspen, with Larry Summers at a retreat, and was both texting and calling Larry Summers and Joe Manchin, saying, you two really need to talk, because, Joe, Senator Manchin, listens to Larry Summers, believed that he was one of the few economists more than a year ago saying that the Build Back Better bill would be inflationary. Larry was able to reach out to and connect with Joe Manchin and help persuade him that this was the right thing to do. But, at the end of the day here, Walter, credit goes to President Biden and his team for letting the Senate work, to Leader Schumer and his team for not giving up on the possibility of a really significant bill here, and more than anything to Joe Manchin for driving a hard bargain. He secured some significant opportunities and investments for fossil energy, as well as the biggest, most important climate change investment in our country’s history. In the end, this is a compromise, which means nobody got everything they wanted, but I think it will move forward and move forward fairly quickly here in the Senate.

ISAACSON: You talk about the economic strategy group that you were with him in Aspen that has Larry Summers in it. One of the things about Aspen groups like that, it’s about half Republican, half Democratic. It’s supposed to be bipartisan. People like Hank Paulson, I think, were there. Are the traditional Republicans you were with, are they supportive of this? Do they believe it’ll be deficit reduction, even though the members of their party in the Senate are voting against it?

COONS: Well, I’m not going to cite any particular person. As you know, those conversations are off the record. But what was really helpful to me and to the other — it was a bipartisan group of senators that were there, both Republicans and Democrats — was, we heard from senior leaders and economic and strategic intelligence, defense and diplomacy leadership from the Bush, Obama, Trump and Biden administrations, and had the opportunity to really talk through the issues we’re facing in the world, Russia’s brutal invasion of Ukraine, China’s expansionist role in its region. And there was some real debate about whether a reconciliation package like this would be anti-inflationary. And I think there was broad consensus that it could be and that, if it secured American energy leadership, it could really contribute to our security as well.

ISAACSON: Now, you’re talking about America’s energy leadership. Joe Manchin also has asked, not as part of this bill, but as part of the understanding that comes with the compromise, that there be some more energy infrastructure, including pipelines, as well as maybe some offshore drilling. Is that a good thing?

COONS: Well, one of the things we discussed, actually, last weekend was critical minerals. We are not going to be able to move to a green energy future without being critically reliant on China if the United States doesn’t find a way to develop and process critical minerals, for example, lithium. You can’t make large-scale batteries, battery storage, without lithium. And there are sources of lithium in North America, in the United States and Canada. But current environmental laws make it very difficult to mine and process lithium in the United States or Canada. And we will be critically reliant on China if we don’t make progress in permitting. One of the things Senator Manchin insisted on was permitting reform. And, yes, that would also quite possibly expedite the permitting of pipelines. It’s also critical that we have permitting reform to expedite transmission lines, so that if we have, as we do, abundant wind and solar in places like the Midwest and Southwest, but that’s not where people are who need the energy, we have to be able to build transmission lines to connect the wind farms of Iowa and Nebraska to the population centers of Chicago and New York and the solar centers of Nevada and Arizona to Los Angeles and San Francisco. So, I do think permitting reform, if done right, can be a positive contributor to a clean energy economy and to America’s energy security.

ISAACSON: You talk about bipartisanship. You had it with the semiconductor CHIPS bill, but also something you have been pushing real hard. You have had a great bipartisan victory, so far at least, with electoral reform. Tell me what the problem was you were trying to solve there.

COONS: So, the main thing a bipartisan group of us focused on was closing the loopholes that former President Trump and his team exploited to inappropriately try and overturn the results of the 2020 election. The narrowest and simplest example is an extreme reading of the law that they were pushing that claimed that the vice president himself personally could overturn the results of the election. That misreading, in no small part, led to the January 6 riot, where folks stormed the Capitol. An angry armed mob assaulted and in several cases led to the deaths of police officers, and then broke into the Capitol and led to all of us fleeing, the vice president being removed by the Secret Service. So we are closing that loophole, making it clear the vice president can’t overturn the election. One other thing we’re changing in this proposed bill is raising the threshold for how many members of the House and Senate are required in order to challenge the electors of a particular state. This bill, now in draft form, doesn’t go as far as I would like. I would like to have seen Voting Rights Act reforms and more investment in security for elections officials and election locations, but it does make some significant progress.

ISAACSON: Perhaps one reason you got some good Republican support on this is the notion of the vice president just overturning or choosing the electors, they would then face Kamala Harris being able to do that in two- and-a-half years. We invited some Republicans on. They’re in favor of this bill, but they didn’t seem eager to come on television. Do you think they’re worried about crossing the Trump base or that this somehow is a rebuke of Trump?

COONS: I think there are certainly some colleagues who will see it that way. The challenge here, as it always is in Congress, is that there are some who will criticize this bill is not going far enough and some, particularly in the Republican Caucus, who will be concerned that it will upset Donald Trump and his supporters. We need to fix the Electoral Count Act. It is a flawed, poorly drafted bill that goes back to the late 19th century, and had never really been closely examined until this attempt by President Trump and some of his inner circle to overturn the 2020 election. So, yes, I think that’s right, Walter, that some of the concern is that President Trump and the few of his folks who stayed with him to the bitter end, as revealed by the January 6 commission, were using this law and some of the ways in which its language was open to misinterpretation.

ISAACSON: A lot of election deniers are running for secretaries of state in various states. They’re running for governor or other places where they might have the right to just throw out electors. This bill doesn’t address that. Jamie Raskin and others say, well, we had to go further. Is there any way to take on that problem?

COONS: We debated this over and over and over. We spent months as a bipartisan working group. And there were some Republicans willing to go farther than what’s in our finished package. There were several of us in the Democratic side who were insisting we go farther. But, in the end, after months, we are out of time. If we’re going to get anything done before the end of this Congress, we need to adopt it.

(CROSSTALK)

ISAACSON: … do it before the midterms, you think?

COONS: Correct. We have to have…

ISAACSON: And what about the House? You have got Zoe Lofgren? You have got Liz Cheney with a slightly separate bill. Are you sure you can get this all together?

COONS: I’m hopeful, but it’s going to be hard, Walter. We have got a significant distance to go to close this. And your viewers may not be aware just how few days are left. It’s July now. It would seem like we have six months to go. But the work calendar of this Congress, actually, we will be in session very few days between now and the end of this calendar year.

ISAACSON: House Speaker Nancy Pelosi says she’s going to visit Taiwan. She’s even trying to get other people from Congress and senators to go on a delegation with her. China says, with some justification, that this violates the spirit of the one-China policy that the United States has always had. Do you think it’s wise for her to be visiting now Taiwan?

COONS: Well, Walter, I have been to visit the PRC and Taiwan. Many members of Congress have. Former Speaker Newt Gingrich, as speaker of the House, went to Taiwan now decades ago. But I will tell you that my principal focus and the real focus of the debates and conversations last weekend in Aspen were on Europe and the Russian invasion of Ukraine, and how to sustain our support for the Ukrainians. My principal concern would be that this could significantly distract the focus of the world, if there were to be some escalation. I respect Speaker Pelosi’s long record of leadership on foreign policy, and I hope she will take the input and advice of a wide range of sources from our intelligence community, our military leadership and make the right decision in terms of, what’s the area we should focus on right now?

ISAACSON: Senator Chris Coons, as always, thanks for joining us.

COONS: Thank you, Walter.