The Rocky Road Ahead

Will the Democrats struggle to pass the rest of their agenda?

“It is not a plan that tinkers around the edges. It is a once-in-a-generation investment in America. Unlike anything we have seen or done, since we built the interstate highway system and the space race decades ago. In fact, the largest American jobs investment since World War II.”

-President Biden, introducing his infrastructure proposal

When President Joe Biden signed the American Relief Plan into law on March 11, he committed the United States to spend $1.9 trillion dollars. (For you number nerds, that is $1,900,000,000,000.00 a really big number.) There was some grumbling from Republicans about the size of the price tag, but the bill’s popularity with a majority of Americans muted full-throated opposition. In fact, several Republican legislators touted particular parts of the bill popular with segments of their constituencies. Still, no GOP Senators voted for it and only the Senate’s bizarre budget reconciliation rule allowed the Democrats to avoid a Republican filibuster and send it to the President’s desk with a one-vote majority.

This will not be the case with the rest of the Biden Administration’s ambitious program. Wednesday, the President announced the American Jobs Plan, proposed legislation to rebuild the nation’s infrastructure that comes with a $2 trillion price tag. The Republicans were quick to condemn the proposal, complaining that it cost too much and encompassed more than rebuilding “roads and bridges”. Referring to Biden’s intention to pay for the cost of the plan by raising taxes on the wealthy, Senate Minority Leader Mitch McConnell called it a “Trojan horse”. “It’s called infrastructure,” he told reporters, “but inside the Trojan horse it’s going to be more borrowed money, and massive tax increases on all the productive parts of our economy.” Much of GOP opposition is focused on proposals that they claim are not traditional infrastructure. Here is a breakdown:

(Source: The White House)

Perhaps a more plausible reason for Republican opposition can be found in the various tax implications of the Biden proposal: the corporate tax rate will be raised from 21 to 28 percent (the Trump tax cut of 2017 had lowered it from 35 percent). Another provision would eliminate tax credits and subsidies for fossil fuel producers. While major business groups such as the American Chamber of Commerce and the Business Roundtable immediately announced their opposition, some corporate leaders were more equivocal. Many have long supported large government investments in infrastructure, making the proposed scale of the Biden proposal attractive. A corporate lobbyist told CNBC, “If you are involved in broadband, electric vehicles, you go down the list, there’s a lot of positive spending that corporate America will like.” Other business interests indicated they would not oppose increasing the corporate rate to 25 percent, the rate they had pushed for in 2017 before Trump and the Republican Congress lowered it even more.

The Republicans are not alone in pushing back on parts of the Biden plan. Senator Joe Manchin (D-WV) has stated he would support raising the corporate rate to 25 percent, not 28. He also made clear his opposition to using the reconciliation process, the same filibuster-proof maneuver Senate Democrats used to pass the American Relief Plan, to push the infrastructure bill through the Senate without Republican support. In the House, several Democratic Representatives from New York and New Jersey vowed to vote against the plan if it does not repeal the 2017 tax bill’s $10,000 cap on the State and Local Tax (SALT) deduction. And while not pushing back against the plan, House progressives feel the plan doesn’t go far enough. As Rep. Alexandria Ocasio-Cortez (D-NY) told MSNBC, “If we could wave a magic wand, and progressives in the House were able to name any number and get it through — which obviously isn’t the case, but if we’re looking at ideals … we’re talking about, realistically, $10 trillion over 10 years.”

All of this sound-bite jockeying portends another season of Congressional gridlock. President Biden is rolling out ambitious plans but they may be headed for the graveyard of legislation, the Senate. As I wrote last week, reforming our elections requires getting H.R.1, the For the People Act, through the Senate in the face of Republican obstruction. Coincidently, in an article in last week’s The New Yorker, Jane Mayer shared information leaked from a conference call in January involving wealthy Republican donors and a policy adviser from Mitch McConnell’s staff. During the call a researcher from a Koch advocacy organization informed the group that H.R.1 polled well even with conservatives and that, instead of attempting to turn public opinion against the bill, use what he termed “under-the-dome-type strategies”- legislative legerdemain- to block the bill.

It seems the ambitious Biden agenda to bring reform and a forward-looking program to government will face a tough going. It will be difficult to restore public faith and trust in a government that can not perform the basic function of passing laws.

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