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FOX Business host Larry Kudlow discusses Biden's economic agenda, inflation, the president's pick for Federal Reserve chair and the programs in the social spending package.

Progressives celebrated the passage of Democrats' nearly $2 trillion reconciliation spending bill Friday morning after months of negotiations but that bill is a shell of its former self and they have little leverage to keep it from shrinking further in the Senate.

"If I'm looking at the situation, I think the progressives didn't get anything, really," R Street Institute senior fellow for governance James Wallner told FOX Business. "They have a much more scaled down infrastructure package, you know, trillions of dollars less than what they originally were demanding, and that was dictated by moderates' pressure to not vote for it."

"Simultaneously on that, they ended up giving up their only leverage, which was letting the infrastructure bill go, which is now signed into law," Wallner added. "It like a perfect storm of badness for House progressives right now."

Rep. Alexandria Ocasio-Cortez, D-N.Y., speaks during a news conference to discuss legislation that would strengthen Social Security benefits, on Capitol Hill Oct. 26, 2021 in Washington, D.C. (Drew Angerer/Getty Images / Getty Images)

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Wallner worked on Capitol Hill for more than a decade and worked in both the House of Representatives and the Senate, including as the legislative director to Sens. Pat Toomey, R-Pa., and Jeff Sessions, R-Ala.

The Congressional Progressive Caucus (CPC) demanded for months that the House not touch the infrastructure bill until the Senate passed the reconciliation bill. House Speaker Nancy Pelosi, D-Calif., agreed.

Then Pelosi and progressives were demanding that the House should pass the reconciliation and infrastructure bills at the same time. But eventually it was Pelosi who strong-armed progressives into passing infrastructure first earlier this month.

Sen. Bernie Sanders, I-Vt., was fond of saying that he would prefer a $6 trillion bill and $3.5 trillion was the compromise. House progressives were behind him.

But the bill was whittled down slowly to just under $3 trillion, then just above $2 trillion, then just under $2 trillion.

Sanders said Friday he was glad the bill passed, but, "Nowthe legislation comes to the Senate where I hope to see it strengthened in a number of ways." Rep. Alexandria Ocasio-Cortez, D-N.Y., said it's "not just conservative changes" that are possible in the Senate but she hopes for "expansionary changes that could happen as well."

Unlikely.

Rep. Alexandria Ocasio-Cortez, D-N.Y., introduces Sen. Bernie Sanders, I-Vt., U.S. 2020 Democratic Presidential Candidate during a rally at University of Michigan on Sunday, March 8, 2020 in Ann Arbor, Michigan. (Salwan Georges/The Washington Post via Getty Images / Getty Images)

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Sen. Joe Manchin, D-W.Va., held firm for months to his topline demand of $1.5 trillion and wants to strip the paid leave provision out of the bill. Sen. Kyrsten Sinema, D-Ariz., hasn't committed to voting for anything yet. And even House moderates like Rep. Stephanie Murphy, D-Fla., are saying the bill needs to get smaller in the Senate if they're to vote for it when it comes back to the House.

"I continue to have reservations about the overall size of the legislation and concerns about certain policy provisions that are extraneous or unwise," Murphy said in a Thursday statement heavily couching her vote for the bill. "I will work with my Senate colleagues to improve this bill, and I hope to vote onand enacta more streamlined version of the bill once it returns from the Senate."

"The budget rules make it really hard to increase the spending in a reconciliation bill on the Senate floor," Wallner said. "The key stage is gonna be how Schumer handles the internal party discussions ahead of that floor debate... They have to have all their ducks in a row, they have to have a come-to-Jesus moment."

Rep. Ilhan Omar, D-Minn., introduces Democratic 2020 U.S. presidential candidate and Sen. Bernie Sanders, I-Vt., at a campaign event in Nashua, New Hampshire, Dec. 13, 2019. (REUTERS/Elizabeth Frantz / Reuters Photos)

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The fact is, Wallner said, moderates hold all the cards in shaping what the final reconciliation bill will look like. And it is not going to look very much like what the "Squad" or the CPC want it to.

"Obviously, you're gonna have to compromise," Wallner said of the legislative process. But progressives will have to ask themselves, "What did they get for all this effort?"

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But Rep. Ilhan Omar, D-Minn., said Friday that the legislative effort is not over.

"Today is a day to celebrate," she said. "Tomorrow is the day to continue to go back to the negotiations and push it in the Senate."

Fox News' Caroline McKee contributed to this report.

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Spending bill passed but leftists got rolled, expert says: 'Perfect storm of badness for House progressives' - Fox Business