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News from EPI New policy memo makes the economic case for expanding the scope of reconciliation

Congress has been gridlocked due in large part to the Senate filibuster, a tactic used to delay or block a vote on a measure by preventing debate on it from ending. Even bills that enjoy broad public support are often unable to pass through Congress. This gridlock negatively impacts families’ economic well-being and should be addressed, according to a new EPI memo.

Expanding the scope of reconciliation—a process allowing a certain subset of legislation to pass with a simple majority—would allow a broader range of crucial economic measures to pass through Congress.

The most direct way to break gridlock in the U.S. Senate would be to abolish the filibuster. However, failing that, the budget reconciliation process provides a limited end run around the filibuster. The policy memo argues that the criteria used to decide what legislation can proceed under reconciliation is arbitrary, incoherent, and outright damaging. One feature of the reconciliation process, the so-called Byrd Rule, limits its scope to budget-related measures. However, the criteria for what types of bills should or should not be allowed to proceed under the Byrd Rule is highly subjective.

There is a common perception that tax and budget policy is the most important policy tool available to Congress to effect economic outcomes, but this is false. The U.S. economy, and the economic security of typical U.S. families, is profoundly shaped by policies passed by Congress that do not see their first-order effects run through changes in the federal budget.

“The assumption that drove the adoption of the Byrd Rule was that budgetary measures were by far the most important economic legislation dealt with by Congress. This just isn’t true,” says Josh Bivens, EPI research director and author of the memo. “The Senate should be enabled to pass much needed economic legislation—even if it’s not directly budget related—with the support of a simple majority.”

The 118th Congress and the Biden administration have a limited time window to make progress on an effective economic policy agenda. Given the political resistance of some senators to abolishing the filibuster, policymakers should consider expanding the scope of reconciliation as an alternative way to break through gridlock and pass much needed economic legislation.