President Biden abruptly ended infrastructure talks with Senate Republican leaders Tuesday as Democrats moved closer to attempting to ram through a sprawling tax-and-spend bill this summer without bipartisan support.
“I spoke with the president this afternoon, and he ended our infrastructure negotiations,” top GOP negotiator Sen. Shelley Capito (R-W.Va.) said in a statement.
“As Republicans, we believe in our nation’s infrastructure, which is why our negotiating team—which consisted of the Ranking Members from the committees of jurisdiction—consistently worked in good faith with President Biden,” Capito said.
The White House said Biden will continue outreach to Republicans and that he spoke Tuesday with Sen. Bill Cassidy (R-La.). But the demise of the Capito-led talks means it’s unlikely a package would have broad bipartisan buy-in.
“We’ve missed a real opportunity here for at least 20 Republicans to join with the other Democrats to pass the most robust infrastructure package that we could have,” Capito, the top Republican on the Senate Environment and Public Works Committee, said Tuesday night in a Fox News interview.
Key sticking points emerged when Republicans refused to consider tax hikes to pay for Biden’s legislation and demanded that he remove social spending that they said was unrelated to infrastructure.
Capito said that “the president continued to respond with offers that included tax increases as his pay for, instead of several practical options that would have not been harmful to individuals, families, and small businesses.”
In her Fox News interview, Capito said Biden’s side-talks with fellow Republican Cassidy may have contributed to the demise of the primary GOP talks. “If there’s something else out there that looks better, sometimes that’s a distraction and that’s disappointing to me,” she said.
White House Press Secretary Jen Psaki said that Biden “informed Senator Capito today that the latest offer from her group did not, in his view, meet the essential needs of our country to restore our roads and bridges, prepare us for our clean energy future, and create jobs.”
Psaki said Biden “expressed his disappointment that, while he was willing to reduce his plan by more than $1 trillion, the Republican group had increased their proposed new investments by only $150 billion.”
Biden also spoke with House Speaker Nancy Pelosi (D-Calif.) on Tuesday “to consult with her on efforts to move forward on an infrastructure/jobs package in the House this month,” Psaki said.
“In the same regard, [Biden] spoke with Senate Majority Leader Schumer to discuss the need to commence work on the budget resolution process so that legislation to advance the President’s economic priorities and tax reform plans could move to the Senate floor in July,” she added. “[Biden] is committed to moving his economic legislation through Congress this summer, and is pursuing multiple paths to get this done.”
The White House said that Biden spoke Tuesday with two centrist Democrats — Sens. Joe Manchin (D-WVa.) and Kyrsten Sinema (D-Ariz.) — who would be essential to a passing partisan infrastructure bill, in addition to Cassidy, who does not hold a Senate GOP leadership role.
Biden initially proposed a $2.3 trillion infrastructure plan in March. But Republicans led by Capito presented a $928 billion counteroffer after Biden came down to $1.7 trillion. Republicans wanted to pay for some of the bill with unused COVID-19 funds.
Some Democrats want to ram Biden’s large original package through Congress without any Republican votes using budget reconciliation — as they did in March to pass Biden’s $1.9 trillion COVID-19 relief bill.
Budget reconciliation allows Democrats, who control the evenly divided Senate, to avoid the usual 60 vote threshold for bills in the upper chamber. But they must maintain unity if they cannot win any Republican support.
In the House, where Democrats hold an eight-seat advantage, a trio of New York-area legislators led by Rep. Tom Suozzi (D-NY) say they won’t agree to any changes in the tax code unless the $10,000 “SALT cap” is eliminated. The cap since 2017 has limited the amount of state and local taxes that residents of high-tax jurisdictions like New York can deduct before paying federal taxes, and its repeal isn’t in Biden’s proposals.
The breakdown in talks came shortly after Senate Minority Leader McConnell (R-Ky.) told reporters that “the era of bipartisanship is over” and will be “coming to a screeching halt this month” as Democrats led by Schumer (D-NY) pursue several bills that lack Republican support.
Since April, Biden took pains to present himself as genuinely interested in compromise with Republicans on infrastructure spending — despite lurking conservative suspicion that he ultimately would try to ram through a one-party bill.
In February, Biden said it was an “easy choice” to move ahead without Republicans just four days after hosting 10 GOP senators to discuss a counterproposal for COVID-19 relief. The $1.9 trillion bill ultimately passed without a single Republican vote.
Transportation Secretary Pete Buttigieg said in a recent interview that the White House would decide this week whether to continue to seek compromise after Congress returned after a Memorial Day break.
“By the time that they return, which is June 7 just a week from tomorrow, we need a clear direction,” Buttigieg said. “The president keeps saying, ‘inaction is not an option’ and time is not unlimited here. The American people expect us to do something.”
Biden’s initial infrastructure plan would be paid for by sweeping tax hikes on businesses. A separate $1.8 trillion “families” plan seeks tax hikes on higher income people and businesses.
Biden’s original plan called for $400 billion proposed for home and community healthcare and $174 billion for electric vehicles. The plan called for $115 billion for roads and bridges, $111 billion to modernize water systems, $100 billion for broadband internet, $85 billion for public transit, $80 billion for Amtrak repairs and $25 billion for airports, among other items.
The final Capito-led counterproposal would have put much more money than Biden’s plan — $506 billion — toward roads and bridges while cutting items that are less traditionally considered infrastructure, like healthcare and electric vehicle subsidies.
The GOP plan approximated other initial Biden asks, calling for $98 billion for public transit systems, $72 billion for water systems, $65 billion for broadband expansion, $56 billion for airports and $46 billion for passenger and freight rail.
