“Infrastructure Week” would have been a week blocked out in Congress to debate and pass a bipartisan bill to fund more roads, bridges, and the like during the Trump administration. The term became a taunt because the effort got pushed back so often by other priorities that it never happened.
President-elect Joe Biden’s team announced a delay of its own infrastructure week as well. It is partly due to the demands of President Trump. On Dec. 23, 2020, Trump gave a nationally televised speech denouncing the stimulus bill that was winding its way to his desk, saying it was full of wasteful spending on the one hand and not nearly generous enough on the other.
Trump threatened to veto the bill unless pork-barrel spending and foreign aid were stripped out and payments to people were increased from $600 per adult to $2,000. Though the president relented and signed the bill, $2,000 checks became a political football, with lots of fumbling by both parties.
The Democratic-controlled House first voted it down and then passed a bill that would make up the $1,400 difference. The Republican-controlled Senate refused to take up the legislation on the initiative of Senate Majority Leader Mitch McConnell.
McConnell’s refusal may have contributed to his party’s losses in Georgia’s two Senate runoff elections on Jan. 5. Those losses will cost Republicans control of the Senate once Kamala Harris becomes vice president.
With a narrow majority in the House and 50 seats in the Senate that amount to a majority when Harris becomes the tiebreaking vote, Democrats have decided to make more stimulus the new Congress’s first priority.
On Jan. 10, Biden’s Twitter account explained: “$600 is simply not enough when you have to choose between paying rent or putting food on the table. We need $2,000 stimulus checks.”
That means Biden’s Build Back Better multitrillion-dollar infrastructure proposals will have to wait until the stimulus gets settled. Will this shift in priorities make it any easier to pass a large infrastructure bill coupled with significant tax increases later this year?
“Politically, it would be easier for [Biden] to fold an infrastructure bill into the coronavirus relief package. He would have to get only one bill through Congress, not two,” Kevin Kosar, a political scientist at the American Enterprise Institute, told the Washington Examiner.
Kosar noted that unemployment benefits from the bill Trump signed in December begin expiring in March. He added, “Doing big infrastructure bills is time-consuming, not least because Democrats define ‘infrastructure’ way more broadly than Republicans.”
“[Biden] may need to plunge forward with a relief bill because having the existing relief efforts expire before being re-upped would politically hurt him and the Democratic Party and would be bad for America,” Kosar said.
Adie Tomer is a transportation scholar with the Brookings Institution’s Metropolitan Policy Program and has a slightly more positive take on the Biden administration’s shuffling of priorities.
“Waiting on infrastructure would be a victory for all sides,” Tomer told the Washington Examiner.
“Congress wouldn’t have to juggle stimulus and infrastructure policy at the same time. The Biden administration would have time to advocate for marrying traditional infrastructure policy and innovative climate-focused policy. And the American public would benefit from more deliberate policy, not rushed action,” he added.
Buried beneath Tomer’s boosterism for stimulus now, infrastructure later creates a more serious disagreement about defining infrastructure reform among centrist Democrats.
“Any infrastructure stimulus should be highly targeted, like the broadband affordability policy within that December law,” he argued. However, Tomer believes that most infrastructure investments should be about long-term change, not short-term relief.
Robert Poole, director of transportation policy at the Reason Foundation, would like to see some long-term infrastructure changes. He doesn’t think the current ways of thinking about the subject will get us there.
“Infrastructure investment funds have raised over $600 billion in the last five years to invest in infrastructure, and U.S. public pension funds are diversifying their portfolios to add investments in long-lived infrastructure. Both types of entities seek to invest equity in revenue-generating infrastructure, such as airports, seaports, toll roads, and electric, gas, and water utilities,” he told the Washington Examiner.
That $600 billion is a tidy sum of money, but there’s a hitch. Because government-owned infrastructure in the U.S. is “100% debt-financed … most of these investments are going overseas,” Poole said. He believes that “getting the private sector to finance a significant portion of the Build Back Better effort should be a no-brainer and should appeal to both fiscally conservative Republicans and to moderate Democrats who want to enable underfunded public employee pension funds to invest in rebuilding America.”
The Biden team is currently eyeing large tax increases to help pay for its larger infrastructure ambitions. It wants to tax capital gains like income and raise the income tax on top earners.
The Washington Examiner asked the Association of American Railroads what it thinks of the feasibility of this wait, stimulate, and tax approach because the AAR is an infrastructure industry group that has been both critical and supportive of Democratic efforts recently. It came out swinging against the green infrastructure bill that the House passed last summer but was boosterish on aspects of Biden’s Build Back Better proposals in the fall.
“The AAR is taking a wait and see approach, as the incoming Biden administration and Congress have many priorities and several different paths for advancing infrastructure policy. Regardless of what they do and when they do it, the most immediate challenge for infrastructure policy in the U.S. is reauthorizing the surface transportation law. The fundamentals of that, including how to pay for it, remain the same and require bipartisan cooperation in Washington,” spokesman Ted Greener said.
