Tentative Bipartisan Agreement Reached For Infrastructure Deal

by Michael London | 06/24/2021 10:00 AM
Tentative Bipartisan Agreement Reached For Infrastructure Deal

A framework for an infrastructure agreement has been agreed upon by the president and a group of bipartisan senators, but can it garner enough support from liberal Democrats and conservative Republicans?

 

Bipartisan senators and White House negotiators agreed on the broad structure of a bipartisan infrastructure deal, with the lawmakers to brief Vice President Biden on Thursday about the specifics.

A sweeping, multibillion-dollar bill is being prepared for passage through the reconciliation process, which would authorize spending on physical infrastructure, education, emissions reduction, child care, paid leave, anti-poverty efforts, and other initiatives.

In exchange for agreeing to a scaled-down bipartisan deal, some liberal lawmakers have demanded assurances that Democrats will have the votes to pass such a package, which could cost as much as $6 trillion over a decade.

Projected increases in federal spending by nearly $600 billion will be used to invest in infrastructure projects such as roads, broadband internet, electric utilities, and other federal projects.

Even though the specifics of the revenue sources have not yet been finalized, it is expected to be paid for with a package of revenue increases that do not violate either Mr. Biden's pledge not to raise taxes on the middle class or Republicans' red line of not reversing business tax cuts—passed in 2017.

Increased enforcement efforts by the Internal Revenue Service to reduce tax evasion by corporations and high earners, which many economists believe will result in a significant increase in tax collections over time, are expected to be a major sticking point in negotiations.

Increases in tax rates paid by corporations, as proposed by Vice President Biden, as well as so-called user fees, as proposed by the Republican Party, are unlikely to be included in these proposals.

"There is a framework of the agreement on a bipartisan infrastructure package," Senator Susan Collins, a Republican from Maine, told reporters as she exited the Capitol building after hours of negotiations. In addition, she explained, "we have to brief our respective caucuses."

Nonetheless, I am optimistic that we have made a breakthrough.

In a meeting on Wednesday, White House officials informed Senate negotiators that President Biden was prepared to support the framework once finalized with specifics, according to a source familiar with the discussions.

Enacting President Biden's proposed $4 trillion of his economic agenda in a piecemeal fashion with the first step focusing on large-scale public works infrastructure is feasible as long as he seals a bipartisan agreement.

According to senators who declined to provide specifics, a framework previously endorsed by the five Republicans and the five Democrats would provide $579 billion in new spending as part of a $1.2 trillion package spread over eight years.

The president's economic proposals, including much of his spending to combat climate change, as well as investments in child care, education, and other types of what administration officials refer to as "human infrastructure," would be left for a potential future bill that Democrats would try to pass through Congress without any Republican votes using a procedural mechanism known as the reconciliation process.

Following the developments on Wednesday, some business leaders declared that President Biden was now firmly on the path to a bipartisan agreement. They immediately began pressuring liberal Democrats with higher spending ambitions to support the agreement.

Some liberal activists and progressives in the House and Senate have expressed concern that Mr. Biden's efforts to reach bipartisan agreements could impede the remainder of his presidential campaign platform, particularly plans to increase worker pay and speed up the shift to a low-carbon future.

Senators Joe Manchin and Kyrsten Sinema from the moderate Democratic Party have argued for continued bipartisan negotiations.

Similarly, business groups have privately urged Republican lawmakers to agree with President Biden on an infrastructure bill that also generates revenue in another way.

Recently, Mr. Biden has dispatched aides to Capitol Hill on several occasions in an attempt to reach an agreement with the centrist group of senators and iron out differences over their initial framework, which was never made public without prior approval from the White House.

According to a joint statement issued after their meeting, both leaders stated that they hoped to move forward with bipartisan infrastructure legislation and the reconciliation process in July.

When asked about the bipartisan agreement, Senate Minority Leader Chuck Schumer of New York responded enthusiastically, "We'll let them announce it first — let's see what they come up with."

 

                        Biden And Senate Close In On Bipartisan Infrastructure Deal

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