Last updated: 7/7/2021
POLICY BRIEF & QUESTIONNAIRE
President Biden - Photo by Michael Brochstein/Sipa USA (Sipa via AP Images); Common Sense Coalition - ; Problem Solvers Caucus - Photo by Michael Brochstein/Sipa USA (Sipa via AP Images);Republican Negotiators - Photo by Michael Brochstein/Sipa USA (Sipa via AP Images)
Both leading Republican and Democratic voices have argued for decades that America should invest significantly more in its infrastructure. President Trump argued that a substantial increase in spending is needed. This year, President Biden has made infrastructure a higher priority than any president since Eisenhower established the interstate freeway system in the 1950s.
The policy debate that Congress and the White House are having about how ambitious our infrastructure investment should be is currently occupying more attention than any other policy debate in Washington. The discussion centers on three key questions. First, what should infrastructure include? Second, how much should the federal government invest in American infrastructure? Third, how should we pay for new infrastructure spending?
What to Include
President Biden and other Democrats support a broader list of what should be included in an infrastructure package than Republicans do. The Biden Administration started this year’s serious infrastructure discussion with the proposal detailed in his American Jobs Plan which includes categories of what they call “human infrastructure.” Senator Shelley Moore Capito (R-WV) and her Republican Senate colleagues led the Republican Party’s negotiations with the White House and proposed their own infrastructure package that included a narrower set of physical infrastructure categories.
Two congressional groups have each offered bipartisan proposals that include fewer categories than the American Jobs Plan but more than Senate Republicans’ plan. In the Senate, the Common Sense Coalition (CSC), a group of ten Democrats and ten Republicans led by Senators Joe Manchin (D-WV) and Susan Collins (R-ME), have addressed infrastructure. Senators Kyrsten Sinema (D-AZ) and Rob Portman (R-OH) led the infrastructure sub-committee of that larger bipartisan Senate group that developed a package that has now been endorsed by the CSC as a whole. In the House, the Problem Solvers Caucus (PSC), a group of 29 Democratic and 29 Republican representatives led by Congressmen Josh Gottheimer (D-NJ) and Brian Fitzpatrick (R-PA) developed a bipartisan proposal (go here and here for more details on their proposal).
Most recently, President Biden announced that he has agreed with the Common Sense Coalition (CSC) on a “Bipartisan Infrastructure Framework” to guide the negotiations to finalize the details of infrastructure legislation. The agreement announced by the White House follows CSC’s more limited list of what to include in bipartisan infrastructure legislation. The categories in President Biden’s American Jobs Plan not included in the bipartisan framework are generally categories that President Biden has called “human infrastructure” like caregiving for aging Americans and those with disabilities along with hospitals for veterans. The White House has pledged to pursue these human infrastructure categories in separate legislation. President Biden further explained that this separate legislation will also include his American Families Plan. The $1.8 trillion American Families plan includes support for child care, paid leave, universal preschool, and free community college. It appears clear that this second legislative package could only pass through reconciliation, a procedural mechanism that would allow Democrats to advance it on a purely party-line basis if all 50 Senate Democrats and almost all Democrats in the House agree.
This brief breaks the discussion of what should be included in an infrastructure package into 11 categories. They are listed roughly in order from those with the greatest bipartisan agreement that they should be included to those with the least agreement.
The categories we review are the 11 included in the agreement that President Biden and the Common Sense Coalition struck.
There has been wide agreement from the start that the first five categories readily fit within the standard definition of infrastructure and should receive new investments. The initial American Jobs Plan, the initial Senate Republicans’ plan, the Common Sense Coalition Plan, and the Problem Solvers Caucus plan all include proposals for increased investment in: (1) surface transportation, which includes roads and bridges, rail, and public transit, (2) broadband, (3) water systems, (4) airports, and (5) ports and waterways.
Bipartisan negotiations have resulted in two additional categories now receiving support from all four perspectives. The sixth category we consider is water storage. At the request of Senate Republicans, President Biden agreed to include new investments for water storage. The seventh category is electric vehicles. Senate Republicans’ agreed to President Biden’s request to include funding for electric-vehicle charging stations in their revised package. Both water storage and electric vehicles are also included in the Common Sense Coalition package that President Biden now supports, as well as the Problem Solvers Caucus proposal.
President Biden’s and the Common Sense Coalition’s agreed upon framework includes the final four categories of the 11 that we consider. Each of the final four are also included by the Problem Solvers Caucus but not by Senate Republicans. In the order in which we consider them, they are: (8) power infrastructure, (9) reconnecting communities divided by previous infrastructure projects, (10) resilience to extreme weather and other climate-related challenges, and (11) remediating abandoned industrial and energy sites.
We do not review the four additional categories that were part of President Biden’s original American Jobs Plan and for which he will continue to advocate as part of the second legislative package that will include his American Families Plan.
How Much to Spend
There is significant bipartisan support for an historic increase in federal infrastructure investment. Democrats generally believe the increase should be much more than Republicans do. President Biden and the Common Sense Coalition significantly improved the prospects that bipartisan legislation will pass when they announced that they have agreed in their framework to an overall increase of $579 billion in total new spending over five years ($1.21 trillion with baseline spending). Still, many Democrats in Congress believe the number should be much higher and many Republicans believe it should be lower.
The agreement between President Biden and the Common Sense Coalition comes after months of serious negotiations. Initially, those negotiations were primarily between President Biden and Senate Republicans. President Biden’s American Jobs Plan initially called for $2.25 trillion in new infrastructure spending over ten years. In negotiations with Senate Republicans, he then reduced the proposed overall spending to $1.7 trillion (about $2.5 trillion including the baseline amount the federal government already expects to spend over that time).
Senator Shelley Moore Capito (R-WV) and her Republican colleagues in the Senate initially proposed $174 billion in new spending above the federal baseline over eight years. Their revised proposal after negotiations with President Biden includes $298 billion in total new spending over eight years ($928 billion if you include baseline spending over that period).
The Problem Solvers Caucus has proposed $619 billion in new federal spending over eight years ($1.25 trillion with baseline spending).
We review the details on the differences in how much each of the four plans propose for each of the 11 categories later in the brief.
How to Pay for It
Finally, perhaps the greatest remaining differences are about how to pay for more infrastructure spending. Two of the largest funding sources in the Bipartisan Infrastructure Framework that President Biden and the Common Sense Coalition have negotiated are (1) closing the tax gap between what is paid and what is owed and (2) repurposing unused COVID relief funds.
President Biden’s Made in America Plan is the companion to the American Jobs Plan that proposes ways to pay for the new infrastructure investments. It identifies increased corporate taxes as the primary funding mechanism. President Biden has indicated he will continue to advocate for these new revenue sources in the second legislative package that will also include his American Families Plan and the human infrastructure categories not included in the Bipartisan Infrastructure Framework. Senate Republicans’ infrastructure roadmap proposes two mechanisms to pay for new infrastructure spending that are not included in the Bipartisan
Infrastructure Framework. First, Senate Republicans suggest that those who use infrastructure bear the costs for it in the form of increased gas and diesel taxes and other user fees. Second, they propose that we streamline permitting processes to save money and make the infrastructure investments go further.
The original Common Sense Coalition proposal included user fees and taxes but they agreed to drop those in the negotiations with President Biden. The Problem Solvers Caucus proposal for how to pay for infrastructure was detailed in their 20-page infrastructure report that preceded their proposal for what to include and how much to spend. It also includes provisions from both President Biden’s and Senate Republicans’ plans, as well as other innovative mechanisms.