Biden offers to cut infrastructure plan bill by a quarter

The US President offered to cut his initial $2.25 trillion proposal to $1.7 trillion in a counteroffer to Republicans, who proposed slashing it down to $568bn.

United States President Joe Biden’s plan includes spending on traditional physical infrastructure projects as well as on social programmes [File: Al Drago/Bloomberg]

President Joe Biden’s team offered to reduce his infrastructure and jobs plan by about a quarter, to $1.7 trillion, a counter-proposal that’s still far higher than what Senate Republicans say they’d support.

Biden’s team “put forward a reasonable counter-offer” to GOP lawmakers on Friday, White House Press Secretary Jen Psaki told reporters. Officials including Transportation Secretary Pete Buttigieg and National Economic Adviser Brian Deese were meeting with Republicans to discuss the offer as she spoke Friday afternoon.

The new White House plan would shift would shift spending on manufacturing, supply chains, small business, and research and development to other pieces of legislation being considered by Congress — including bills aimed at combating China’s technology dominance and the global semiconductor shortage, Psaki said.

Compared with the original $2.25 trillion “American Jobs Plan,” spending requests on roads, bridges and other transportation infrastructure projects, as well as on broadband was trimmed, according to Psaki.

The new total still dwarfs an initial offer from Senate Republicans of $568 billion, an amount that had included baseline spending. Senate GOP leader Mitch McConnell had suggested a compromise figure as high as $800 billion, still far below the new Biden topline.

Funding Question

The administration’s plan doesn’t give up on all of Biden’s priorities. It includes spending on clean energy, railways, workforce training, the so-called care economy and other areas that Senate Republicans omitted from their initial offer, Psaki said.

As for funding measures, the White House will not yield on the president’s requirement not to raise taxes on Americans earning less than $400,000, Psaki said, again ruling out a gas tax increase or the user fees that some Republicans have proposed.

Biden hosted a group of Senate Republicans at the White House last week to step up an effort for a bipartisan compromise, and both sides have continued talks since then.

In last week’s talks, the administration highlighted that it would aim to pursue social spending and tax measures separately if they weren’t included in any compromise. The Republicans underscored they wouldn’t consider any roll-back of the 2017 tax cuts they enacted.

Biden has also released a separate $1.8 trillion “American Families Plan,” made up of social spending and higher taxes on wealthy individuals.

West Virginia Senator Shelley Moore Capito, the lawmaker leading the GOP effort, said earlier this week she saw a more than 50% chance of being able to reach an agreement with the president. She described the next two weeks as “critical” to the talks. The overall process still has months to go, she said, with a bill was unlikely to clear both chambers of Congress by July 4, a deadline proposed by House Speaker Nancy Pelosi.

Source: Bloomberg