Can Republicans Stop Biden’s Sweeping Infrastructure Plan?

Dear Rich Lifer,

It is shaping up to be a critical week for Republicans and Democrats to reach a compromise on President Joe Biden’s proposed infrastructure bill. 

There has been a reported soft deadline of Memorial Day for bipartisan discussions, meaning this week will likely be filled with plenty of back and forth as both sides of the aisle scramble to find middle ground.

Optimism surrounding the talks dimmed last Friday when Republicans rejected the Biden administration’s counteroffer. 

Today, we break down where things currently stand in negotiations and explore what might happen if an agreement cannot be reached in the coming week.

Trimmed Plan Rejected 

The White House proposed lowering spending on highways (to $120 billion from $159 billion) and broadband (to $65 billion from $100 billion) and shifting some programs into other legislations in a new offer designed to kick-start bipartisan infrastructure negotiations. 

The changes would decrease the price of the plan from $2.3 trillion to $1.7 trillion. This number was still far above the originally proposed Republican plan of $568 billion.

White House press secretary Jen Psaki said in a statement, “This proposal exhibits a willingness to come down in size, giving on some areas that are important to the president … while also staying firm in areas that are most vital to building our infrastructure and industries of the future.”

Senate Republicans commented that the offer was “well above the range of what can pass Congress with bipartisan support.”

In the virtual presentation of the smaller plan, the White House gave no indication that they would budge on aspects of the bill that raise corporate taxes to 28% to fund the proposed programs.

Republicans want to fund the bill by repurposing money from President Biden’s $1.9 trillion economic aid package and raising user fees like the gas tax.

A statement from a spokeswoman for the lead GOP negotiator, Senator Shelley Moore Capito of West Virginia, went on to explain that both sides “seem further apart after two meetings with White House staff than they were after one meeting with President Biden.” 

The definition of the term “infrastructure” has become another sticking point in negotiations. President Biden has called for a broader definition of infrastructure that includes investments in fighting climate change and providing home health care, which Republicans have called overly expansive.

A Bipartisan Deadline

Both Republicans and Democrats have discussed Memorial Day as a deadline for bipartisan cooperation.

Transportation Secretary Pete Buttigieg said:

We continue to think there needs to be major progress by Memorial Day… we really need to get this [bill] done this summer, which is why we continue to want to see, even just in the few days between now and the holiday, some real progress if we’re going to pursue this path.

President Biden has repeatedly stated he wants to pass an infrastructure plan with bipartisan support, but after the recent Republican rejection, many Democrats are pushing him to abandon a compromise.

Liberals in Congress have, instead, begun urging Mr. Biden to move his plan with a party-line vote using the process called reconciliation, which is how his economic stimulus plan was passed earlier this year.

In a statement released on Friday, Senator Ed Markey (D., Mass.) commented, “Let’s not waste time trading the necessary scope and scale of this critical infrastructure package for congressional Republican votes that have yet to and will never materialize.” 

And as much as President Biden has expressed his desire to work across the aisle, it is also clear he is not willing to let the timing run out on making meaningful change. 

Cedric Richmond, a White House senior adviser, summed up Mr. Biden’s current mood stating: 

He wants a deal. He wants it soon, but if there’s meaningful negotiations taking place in a bipartisan manner, he’s willing to let that play out. But again, he will not let inaction be the answer. And when he gets to the point where it looks like that is inevitable, you’ll see him change course.

Looking Ahead

The White House has stated that they hope Republicans will come back with a counteroffer to show a willingness to find a compromise. 

There is a September 30 deadline to reauthorize a series of federal transportation programs. However, Democrats expect that approving these routine policy adjustments won’t be possible by using the reconciliation process, which puts extra pressure on the ability to find a bipartisan solution. 

House Speaker Nancy Pelosi (D., Calif.) has set a July 4 deadline for passing infrastructure legislation in the House, although many expect it will take longer. 

Smaller bipartisan efforts are still underway. For example, Republican Senator Capito and Democratic Senator Tom Carper unveiled a $340 billion surface transportation bill, which could serve as building blocks for crafting a full bipartisan infrastructure bill.

However, Democrats are also preparing for a reconciliation process. Independent Senator Bernie Sanders, the chairman of the Senate Budget Committee, is ready to work on a budget resolution — the first step in the reconciliation process — as soon as the White House unveils its budget. 

Last week, both Republicans and Democrats met with the Senate parliamentarian to try and determine if Democrats could use an existing budget to try and pass infrastructure with just 51 votes. 

A decision from the parliamentarian is expected this week, and if it is determined that Democrats can use one budget multiple times for reconciliation, it would mean Democrats may have multiple opportunities this year to pass bills with only 51 votes.

This would still mean that every single Democratic Senator would need to be on board with the plan for it to pass. 

Republican Senator Mitch McConnell commented, “They may be able to pull it off, but I think it’s going to be really hard, and we’re going to fight them the whole way if that’s what they have in mind.”

One thing is for sure, it’s a tense week on Capitol Hill.

To a Richer Life,

The Rich Life Roadmap Team 

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