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IN THIS EDITION

Sanders pushes Harris on progressive agenda

Thune’s warnings on reconciliation

On the ground in Arizona and Nevada

The Vault: A bipartisan, bicameral bill on banking and AI

THE TOP

Sanders pushes Harris on progressive agenda

Happy Monday morning.

The House and Senate are out until September. President Joe Biden will be in Washington on Monday for meetings on the situation in the Middle East. Vice President Kamala Harris has a whirlwind campaign tour this week that features stops in eight states over five days covering more than 4,700 miles.

Progressive Push. As Harris finalizes the critical issue of who her running mate will be, Sen. Bernie Sanders (I-Vt.) is pressing the presumptive Democratic nominee to embrace a sweeping progressive agenda during her run for the White House.

Sanders recently commissioned a poll of more than 1,150 voters in the battleground states of Arizona, Georgia, Nevada, Michigan, Pennsylvania and Wisconsin. The one-on-one contest between Harris and former President Donald Trump is tied at 49%, which is similar to recent surveys. When Robert F. Kennedy Jr. and other third–party candidates are added in, Trump leads Harris 46%–45%.

Yet the same poll shows the progressive agenda — much of which was included in Build Back Better and other proposals by Biden, Sanders notes — was overwhelmingly popular. This comes even as the state of the U.S. economy, jobs and inflation, issues on which Trump and Republicans are dominating, are easily the top focus for voters.

“There are not any radical ideas that nobody has ever heard of,” Sanders said in an interview on Sunday to discuss the poll findings.

For instance, the poll shows that increasing taxes on the wealthy is supported by a 71%-27% margin overall. Even Republicans favored it by a 55%-43% majority.

Raising taxes on large corporations was also popular. A full 67% of respondents supported this, compared to 29% who said these companies should pay the same as they are now or less.

And there was very strong backing for increasing the minimum wage, with fully 89% saying the current $7.25 per hour rate needs to be boosted. Raising the rate to $17 per hour was backed by 70% of respondents, the majority of those strongly. The Senate rejected Sanders’ effort to increase the minimum wage to $15 back in March 2021, although many states have boosted it themselves.

Other long-time progressive planks — many of which Sanders has unsuccessfully pushed for years — get a big thumbs up in this poll too. These include expanding Social Security benefits; adding dental, vision and hearing coverage to Medicare; a bigger Child Tax Credit; single-payer health care; eliminating medical debt; building two million “affordable-housing units” and capping rent increases; and free college for all, among other actions.

Interestingly, a solid majority — 57% — also oppose cutting military spending, which Sanders and Hill progressives have long urged.

More from Sanders:

We’ll note that these progressive initiatives have little if any chance of becoming law due to overwhelming GOP opposition. However, Sanders argued that the polling showed Harris should adopt them as part of her campaign for president.

We also asked Sanders about concerns over inflation, which voters decisively say is their top issue. The progressive agenda would require hundreds of billions of dollars in new spending at a minimum, even as the federal government is already bleeding red ink.

Trump and Republicans have hammered Biden — and now Harris — over inflation and the high cost of living, arguing that the trillions spent under the American Rescue Plan, Inflation Reduction Act and other Democratic proposals set off the biggest surge in prices in more than 40 years.

But Sanders, like many Democrats, counters that the real cause of inflation is Corporate America raising prices in order to boost their bottom line.

“I think the overwhelming economic evidence is that the reason we’ve had inflation in recent years has everything to do with corporate greed,” Sanders said. “Most of the inflation we’re seeing in recent years has to do with record-breaking corporate profits.”

It’s also worth pointing out that some economists say Trump’s agenda would cause higher inflation than anything Democrats have proposed.

Sanders — the leading and loudest progressive voice on Capitol Hill — will be headlining a “Progressives for Harris” organizing call tonight. Other participants include Sens. Elizabeth Warren (D-Mass.) and Ed Markey (D-Mass.), Reps. Pramila Jayapal (D-Wash.) and Jamie Raskin (D-Md.), UAW President Shawn Fain and Chicago Mayor Brandon Johnson, as well as a host of others.

Yet Sanders hasn’t formally endorsed Harris either. We asked Sanders about this discrepancy:

— John Bresnahan

2025 LOOKAHEAD

Thune’s warnings on reconciliation

Republicans are salivating at the possibility that they’ll have the “trifecta” next year — control of the House, Senate and White House – giving them major sway over the expiring Trump tax cuts.

But as we’ve seen in the past, even when Republicans run Washington, they can’t always deliver on their promises.

That’s where Senate Minority Whip John Thune could come in. Thune is running to be the GOP leader next year. The South Dakota Republican would rely heavily on his experience in crafting the 2017 Trump tax cuts if he wins the post.

No easy task: Many of the Trump tax cuts expire next year. As we reported in the Sunday Vault, House and Senate GOP leaders have already started coordinating on a potential reconciliation package for early 2025. Speaker Mike Johnson has been talking with former President Donald Trump, too, to set realistic expectations and hear about the GOP candidate’s priorities.

As the current No. 2 Senate Republican, Thune has been involved with reconciliation prep and recently met with House Majority Leader Steve Scalise.

“We’ve got a more restrictive set of rules than the House does. So having the House understand what’s realistic… we want them, going in, to know what we think the parameters are,” Thune said.

Under reconciliation, Republicans would need to use the budget reconciliation process in order to pass a party-line tax bill. Crucially, that lowers the threshold for Senate passage to a simple majority.

But relying on GOP votes alone is risky. Even with full GOP control, Senate Republicans would have to deal with a House that’ll want to take reconciliation further than the Senate parliamentarian will allow.

On top of that, the Senate GOP Conference looks a lot different than it did seven years ago. And with what could be a narrow majority — if that — GOP leaders will need virtually every Republican to be on board.

Whoever wins the race to succeed Senate Minority Leader Mitch McConnell will be crucial to getting a bill through the Senate’s complex reconciliation rules — a process known as the “Byrd bath” — as well as navigating an unruly bunch that now includes populists.

More from Thune:

A Senate-dictated process: Thune told us his goal with the prep work is to gather feedback from individual members and relevant committees, as well as working with the House to set expectations. Thune said Republicans are eyeing Democrats’ reconciliation push from the last Congress as a blueprint for next year.

“I think the Democrats did widen it,” Thune said. “They clearly expanded the scope of reconciliation with [the American Rescue Plan Act] and the [Inflation Reduction Act].”

Here’s Thune’s take on the big-picture goals:

The good sign for Republicans is that Thune and Johnson are singing from the same songbook — for now.

Subscribe! Premium Policy subscribers got much more from our sit-down with Thune on the Senate GOP leader race and the 2025 tax fight in the Sunday Vault. Learn more about subscribing here.

— Laura Weiss and Andrew Desiderio

ON THE CAMPAIGN TRAIL

On the ground in Arizona and Nevada

PHOENIX — Vice President Kamala Harris and her yet-to-be-named running mate will cap off a five-day battleground state swing in Arizona and Nevada later this week, two states where Republicans think they can win not only at the presidential level but also flip Senate seats.

We’re on the ground in both states this week to dig into their respective Senate races and whether the top of the ticket will impact these crucial down-ballot races.

For several months, former President Donald Trump has been out-performing the Senate GOP challengers in the battleground states. Republicans are hoping to turn that trend around with just three months until Election Day.

Arizona: Rep. Ruben Gallego (D-Ariz.) and GOP nominee Kari Lake avoided a potentially treacherous three-way race in the Grand Canyon State when Sen. Kyrsten Sinema (I-Ariz.) decided not to seek reelection.

Lake is coming off a primary victory that was closer than expected, leading Democrats to question whether Arizona Republicans are truly united behind her. But Lake got a boost when Karrin Taylor Robson, a one-time rival and an establishment Republican, endorsed her last week.

The NRSC backed Lake early on, though some Republicans had reservations about whether Lake could be competitive after losing the gubernatorial race in 2022 and repeating Trump’s false claims about a stolen election.

Among Democrats, Gallego consolidated support within his party pretty quickly after emerging as a top critic of Sinema from the left. Gallego served in the Marines for six years and deployed to Iraq before winning a House seat in 2014.

His progressive voting record has come under scrutiny from Republicans. Gallego has been mildly critical of the Biden administration over its handling of the migrant crisis at the U.S.-Mexico border. This is obviously a massively important issue in Arizona, and one that Trump and Lake could benefit from if they play their cards right.

The latest RealClearPolitics polling average has Gallego ahead by a few points but Trump leading Vice President Kamala Harris by a similar margin.

Like other Democratic Senate candidates, Gallego is highlighting abortion rights as a key theme of his campaign. But he’s also launching an effort this week to attract Republicans.

This is aimed at wooing the state’s formidable bloc of so-called “McCain Republicans” — the late GOP Sen. John McCain is still much revered in the state — and voters who may have otherwise supported Sinema. Gallego believes he can attract independents and centrist Republicans by portraying Lake as too extreme.

Nevada: We were out in the Silver State almost exactly one year ago to start diving into the race between Sen. Jacky Rosen (D-Nev.) and GOP challenger Sam Brown.

Republicans in D.C. have been high on Brown for a long time now. Brown, a retired Army captain, was severely injured when his convoy was bombed in Afghanistan.

GOP senators have told us that they believe the combination of Brown’s inspiring personal story plus the changing electorate and unique economic conditions in Nevada can help Republicans flip this seat. In an interview last week, Senate Minority Leader Mitch McConnell named Brown as being among a slate of “fabulous” GOP candidates. Of course, McConnell was vocal about “candidate quality” being a problem for the party in 2022.

Rosen is doing an event in Las Vegas this week with EMILY’s List, the pro-abortion rights group. Rosen’s campaign believes she’ll benefit from the fact that abortion rights will be on the ballot in the state in November.

Like other Democrats, Rosen is also highlighting the implementation of the bipartisan achievements of the last Congress, including the infrastructure bill, which has paved the way for a long-desired high-speed train route between Las Vegas and Los Angeles.

The RealClearPolitics polling average has shown Rosen with a pretty consistent lead over Brown, though Trump is slightly ahead of Harris.

— Andrew Desiderio

The Vault: A bipartisan, bicameral bill on banking and AI

First in the Vault: A bipartisan group of members unveiled legislation that would direct federal financial regulators to create “regulatory sandboxes” for financial firms to experiment with artificial intelligence.

Led by Sens. Mike Rounds (R-S.D.) and Martin Heinrich (D-N.M.) plus Reps. French Hill (R-Ark.) and Ritchie Torres (D-N.Y.), the bill is titled the Unleashing AI Innovation in Financial Services Act.

Read the legislative text here.

The idea with regulatory sandboxes is allowing financial firms to do some limited experimentation with novel products that don’t fit neatly into existing consumer compliance law.

Sandboxes mostly exist at the state level, despite earlier congressional efforts to expand them nationally.

This sandbox bill from Rounds, Heinrich, Hill and Torres would allow firms to apply and “experiment with AI test projects without unnecessary or unduly burdensome regulation or expectation of retroactive enforcement actions.”

That application would let firms request that compliance with specific regulations be “waived or modified.” Companies could also propose an “alternative method” for complying with existing regulations.

Companies would need to demonstrate their project wouldn’t present a “systemic risk” to the U.S. financial system and comply with anti-money laundering laws.

The agencies covered include the Federal Reserve, Federal Deposit Insurance Corp., Office of the Comptroller of the Currency, Securities and Exchange Commission, Consumer Financial Protection Bureau, National Credit Union Administration and Federal Housing Finance Agency.

— Brendan Pedersen

… AND THERE’S MORE

First in Punchbowl News: Democrat Kirsten Engel’s first ad of her general election campaign against Rep. Juan Ciscomani (R-Ariz.) leans into a populist economic message.

The ad features two references to stopping “corporate price gouging.” Plus, Engel slams the incumbent Republican as just another politician who leaves voters behind. Engel’s matchup against Ciscomani in Arizona’s 6th District will be one of the most competitive House races in the country.

Downtown Download: Mehlman Consulting has hired Naveen Parmar as a principal. Parmar was chief counsel to Sen. John Hickenlooper (D-Colo.) for the last three years and has worked on the House Small Business and Ways and Means committees, as well as for Sen. Amy Klobuchar (D-Minn.). Here’s the release.

— Jake Sherman and Max Cohen

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