The White House is preparing for its next big swing on the economy.
Shortly after passing his $1.9 trillion Covid-19 relief package, President Joe Biden is preparing to unveil his “Build Back Better” plan Wednesday during a public address in Pittsburgh, Pennsylvania. The White House discussed an approximately $3 trillion infrastructure package on a call last week with Senate Democrats, but the price tag and final details are still under discussion, a person familiar with the plan told Vox.
Those close to the Biden White House underscore this is a key part of the president’s agenda, and his goal of steering America’s economy toward clean energy and manufacturing. Biden and Democrats see an infrastructure package as the best way to tackle climate change and get the country to net-zero electricity emissions by 2035, by installing more electric vehicle charging stations on the nation’s roads, modernizing the electrical grid, and incentivizing more wind and solar projects. It could be financed at least in part with higher taxes on corporations and the wealthiest Americans.
“I think they’re obsessed with 2035,” former Obama climate adviser John Podesta told Vox in a recent interview, speaking about the Biden White House. “If you stand back and think about buildings, efficiency, transportation, electrification of vehicles, it’s all built on the idea that you’re running clean electrons through that system.”
In addition to using infrastructure to tackle climate change, administration officials are planning to introduce a second package that deals with the care economy, including child care and paid family leave, universal pre-kindergarten, and free community college tuition, the New York Times first reported and White House press secretary Jen Psaki confirmed this weekend.
The Covid-19 pandemic showed an acute need to create more of a child care safety net in the US, but the fact that the administration appears to be breaking the two packages apart could be a signal they think the infrastructure and clean energy proposals have a greater chance of passing through a closely divided Congress and getting support from moderate Democrats, including Senate swing vote Joe Manchin (WV).
No matter what, the process of coming up with a final infrastructure package will be long and fraught. Democrats are planning to kick off a bipartisan process, but could rely on budget reconciliation to pass major portions of an infrastructure package that Republicans don’t support.
“I hope it will be the largest infrastructure package in American history,” Rep. Don Beyer (D-VA), the chair of Congress’s Joint Economic Committee, told Vox. Speaking about a $1.5 trillion infrastructure package House Democrats passed in 2019, Beyer said, “To me, that seems it should be the floor, and we should go up from that.”
There are many infrastructure bills in Congress right now
It will likely take a bit more time for the White House to release its blueprint for an infrastructure plan, and lawmakers are starting a two-week recess. But there are a lot of infrastructure bills floating around Congress that the Biden administration could incorporate.
Last year, the House passed its own $1.5 trillion infrastructure package, the Moving Forward Act. The bill invested in traditional roads and bridges infrastructure, but also put money toward revitalizing America’s rail system, aging school buildings, and spotty broadband infrastructure. Here are the key points of the Moving Forward Act:
- $300 billion for fixing existing roads and bridges, including tens of thousands of structurally deficient bridges
- $100 billion for transit funding, including putting more zero-emission buses on the roads and upgrading roads to be friendlier to pedestrians and bicyclists
- $1.4 billion for alternative fuel charging infrastructure, like electric vehicle charging stations, and tripling funding for Amtrak to $29 billion
- $130 billion for school infrastructure, to improve aging school buildings that were built with hazardous materials like asbestos and lead pipes
- $100 billion for affordable housing infrastructure to either create or preserve 1.8 million affordable homes
- $100 billion for broadband internet infrastructure to unserved and underserved rural, suburban, and urban communities, prioritizing those in “persistent poverty”
- $40 billion for new wastewater infrastructure, and over $25 billion for the Drinking Water State Revolving Fund
Also in the mix is a surface transportation bill that funds roads and bridges and is up for its five-year reauthorization this year. The reauthorization bill is something that Republicans and Democrats alike see as having the potential for the most bipartisan compromise, and there has been some talk on Capitol Hill about passing a bipartisan roads and bridges infrastructure bill, and then putting the more ambitious pieces of Biden’s infrastructure plan into a budget reconciliation bill.
The House and Senate are starting in different places on the surface transportation reauthorization bill. The House bill is close to $500 billion, and the Senate passed a bipartisan $287 billion highway funding bill in 2019. Now that Democrats are in the majority, the top-line figure is likely to increase when the committee proposes an updated bill. Still, negotiations over the surface transportation bill could be overshadowed by Biden’s larger infrastructure plan.
A spokesperson for the House Transportation Committee said the surface transportation bill would be part of a larger push. “While decisions about the size and scope of a broader jobs and economic recovery plan get hammered out, Chair [Peter] DeFazio is working as we speak to advance an ambitious surface transportation reauthorization bill through his Committee later this spring, which is expected to serve as a major component of a broader infrastructure package,” committee spokesperson Kerry Arndt told Vox in a statement.
Beyond the main infrastructure bills in Congress, there are plenty of other bills that could be incorporated into a larger budget package. The House Energy and Commerce Committee has the CLEAN Future Act, which would put forward a clean electricity standard and lay out a pathway to decarbonize the US electricity sector by 2035. Sen. Richard Blumenthal (D-CT) and Rep. Bobby Rush (D-IL) have a bill to create a dedicated Passenger Rail Trust Fund that would serve as a primary funding stream for Amtrak, rather than the appropriations money the rail system now receives.
On the community infrastructure side, House Committee on Education and Labor Chair Bobby Scott (D-VA) has a school infrastructure bill to repair toxic and ancient school buildings, particularly in poorer and underserved communities. And Assistant Speaker of the House Katherine Clark (D-MA) has a “Child Care Is Infrastructure” bill that would authorize $10 billion over five years to invest in child care infrastructure in the US.
“The Biden administration understands this and has made a care agenda one of their top priorities,” Clark told Vox in a recent interview.
Infrastructure isn’t as bipartisan as it seems
Infrastructure is sometimes talked about in Washington like it’s the most bipartisan issue in town.
Indeed, legislation funding fixes to the nation’s roads and bridges are relatively noncontroversial and bipartisan, as is the need for better broadband access in states and cities. But the main disagreement between Republicans and Democrats on infrastructure is how big a package should be, what exactly should be in it, and perhaps most importantly — how to pay for it.
Republicans want a smaller infrastructure package to deal mainly with roads and bridges, and they want to get that done without raising taxes. Democrats see things differently, viewing infrastructure as a key opportunity to transition the US economy toward clean energy, as well as strengthening “human infrastructure” with better schools, more generous child care, and free community college.
“Climate and infrastructure are closely linked,” a person familiar with the Biden recovery plan told Vox. Biden campaigned on a $2 trillion climate and clean energy plan that seeks to get the US to net zero emissions by 2050, and by 100 percent clean electricity by 2035. Biden’s campaign plan sought to create 1 million new jobs in the American auto industry, domestic auto supply chains, and auto infrastructure.
“Are [Republicans] willing to invest the amount of funding that’s required to make sure the US automaker retool and the incentives are there to make sure American consumers move toward electric vehicles?” said founder of the Climate and Energy Program at the centrist think tank Third Way Josh Freed. “It’s not at all clear that can be the case.”
Then there’s the debate of how a massive infrastructure bill, coming on the heels of an already passed and signed $1.9 trillion Covid stimulus law, will be paid for. As Vox’s Emily Stewart has detailed, Biden has already floated upping the corporate tax rate, raising taxes on households making $400,000, and adjusting the estate tax and capital gains taxes.
Importantly, these tax proposals have the support of moderate Democrat Sen. Joe Manchin of West Virginia, who has told reporters he wants an “enormous” infrastructure bill. But Manchin also wants the tax increases and larger package to be bipartisan — which will be much more difficult.
Podesta told Vox he’s certain the Biden White House will introduce a bold package with some audacious goals. How those goals are shaped by the demands of an unpredictable Congress is the bigger unknown.
“The question there is really what’s going to make it through the legislative process,” Podesta said. “The only thing I’m certain of is they’re going to push for big investments, in both power production and transmission.”
Passing an infrastructure package could take much of the year
The process of drafting and passing an infrastructure bill that the White House, the Senate, and the House all agree on will likely be far more drawn out than Biden’s $1.9 trillion Covid relief package; the House Transportation and Infrastructure Committee has a September deadline to pass the approximately $500 billion five-year surface transportation bill. But that bill isn’t likely to drive the debate around infrastructure.
Democrats want to pass many more components throughout the summer. Democrats are saying that they want the process to be bipartisan and include Republican input, but under current Senate rules, they also have at least one more shot this year to use budget reconciliation to pass an infrastructure and climate bill with 51 votes.
Earmarks — provisions in a spending bill directing money toward projects in various congressional districts — are potentially making a comeback, after past controversies over accusations of waste. With this kind of “pork” spending, some Democrats hope they can entice Republicans to lend bipartisan support to the next big budget bill.
Earmarks may mean there’s more of a deal to be had on infrastructure, but they’ll also ensure the process could be messier — with lawmakers jockeying to get their district’s priorities some money.
During the Covid-19 bill process, lawmakers were told to hold off on putting their individual wants and needs into the first budget bill, because time and quick passage were of the essence to combat the pandemic. Now, it’s going to be open season.
“Every single member has a bunch of stuff they want to do they were told they could not do in the first package,” a Democratic congressional aide told Vox. “Truly, every senator’s pet project who hasn’t been in the majority before, now has an opening.”
Biden and Democrats in Congress have months of strategic decisions ahead of them. The choices they make — whether or not to work with Republicans, whether to split up the package or keep it as one, how much to indulge the pet projects of lawmakers through earmarks — will shape a crucial piece of Biden’s legacy.