Infrastructure negotiations enter make-or-break week

President Biden will sit down with Sen. Shelley Moore Capito (R-W.Va.) on Wednesday as his infrastructure negotiations with Republicans enter a critical and potentially final week. 

Administration officials have signaled this is a make-or-break week on bipartisan negotiations, with Biden hoping to pass an infrastructure bill with or without Republicans by the end of the summer.  

Transportation Secretary Pete Buttigieg said over the weekend that the Biden administration needs to have “clear direction” on infrastructure by June 7. Wednesday’s meeting could be the last opportunity for Biden and Capito, who is leading a group of Republicans, to find a way to come together on a plan to rebuild the nation’s ailing infrastructure.  

Allies say that Biden truly wants a bipartisan deal, but he’s also encountering growing pressure from some Democrats to abandon the negotiations with Republicans and pursue a bill using budget reconciliation. Democratic sources say it is difficult to see negotiations dragging on past mid-June and expect Biden to make a decision before then on whether to cut a deal with Republicans or try to go it alone with Democrats.  

Speaking to reporters aboard Air Force One on Tuesday, White House principal deputy press secretary Karine Jean-Pierre described the coming week as “incredibly critical” to charting the path forward on infrastructure legislation without explicitly saying the White House would try to move ahead without Republicans if a deal is not reached by next week.

“He is appreciative and heartened by the good faith effort that we have seen from Republican senators, but as the president said last week, we do need to finish these negotiations soon because we are in a race to win the 21st century, and the pandemic exposed just how badly we need to invest in the foundation of this country,” Jean-Pierre said. 

“We are working actively with members of the House and Senate this week so that there is a clear direction on how to advance much-needed jobs legislation when Congress resumes legislative business the week of June 7,” she continued. 

While the White House and Senate Republicans have inched closer to one another, they remain in disagreement on the size and scope of an infrastructure package and how to pay for it.

Biden wants to see a bill passed by summer, which leaves a limited window of time for a bill to advance in Congress before the August recess. The reconciliation process will take at least several weeks, requiring both the House and Senate to pass budgets that align with one another with the input of multiple committees. It took Democrats one month to pass Biden’s $1.9 trillion coronavirus relief bill using budget reconciliation, which was considered fast given the size of the package.  

“When you look at the legislative calendar, there’s simply not a lot of days left between now and when they want to go on recess,” said Jim Manley, former aide to then-Senate Majority Leader Harry Reid (D-Nev.). 

Capito has indicated recently that negotiations are still alive. She said on Fox News on Sunday that she thinks Democrats and Republicans could still reach “real compromise” on an infrastructure package.

“I think we can get to real compromise, absolutely, because we’re both still in the game. I think the president told me himself that let’s get this done. We realize this is not easy. I think we bring every idea that’s on the table into the negotiations to see how we can achieve this and get it across the threshold,” she said. 

Senate Republicans unveiled a $928 billion counterproposal last week after Biden lowered his offer to $1.7 trillion. The Republicans’ offer includes about $260 billion in new spending, causing Democratic senators to reject it. Capito and other Republican Senators met with Biden on May 13, and officials initially wanted progress by Memorial Day on negotiations. 

Republicans have favored an infrastructure package that focuses on traditional forms of infrastructure such as roads and bridges. How to pay for the package has also been a point of contention where it’s been difficult to find any consensus.  

Biden has proposed increasing the corporate tax rate from 21 percent to 28 percent. He’s also called for raising taxes on high-income individuals in several ways, including through higher top rates for both wage income and capital gains, to pay for his broader agenda. But Republicans have ruled out rolling back the 2017 tax cuts signed into law by former President Trump. 

The White House’s own two red lines are “inaction” and increasing taxes on Americans making less than $400,000 annually.

Hazen Marshall, former policy director for Senate Minority Leader Mitch McConnell (R-Ky.), argued that “consideration of a bipartisan traditional infrastructure bill as Republicans have suggested could certainly be accomplished by the August recess.” 

“Ironically, if negotiations fail and Democrats go the reconciliation path, the time it would take to coordinate passage of a budget resolution and then negotiate, draft, vet and pass the resulting reconciliation bill could take even longer than a regular order bill,” Marshall added.

Democratic lawmakers have become increasingly impatient during the White House’s negotiations with Republicans to strike a deal, and some say that Republicans aren’t negotiating in good faith. Sen. Kirsten Gillibrand (D-N.Y.) called it a “misstep” for Democrats to “wait any longer” for Republicans on infrastructure negotiations. She said she would go forward and pass a bill with 51 Democratic votes through reconciliation.

Senate Majority Leader Charles Schumer (D-N.Y.) has also said Democrats will move forward with an infrastructure bill in July, whether the legislation is bipartisan and they work with Republicans or not. 

Democrats could ultimately pair Biden’s infrastructure plan with his families plan — which together would total $4 trillion — in one reconciliation bill in order to pass as much of the president’s agenda as possible, but doing so might risk support from moderate Democrats such as Sen. Joe Manchin (W.Va.). 

“I do think that it’s time for them to decide — they either commit to a compromise process with Capito and her effort, or they have to walk away now and try to blame Republicans and make the partisan push,” said Alex Vogel, CEO of The Vogel Group and former chief counsel to then-Senate Majority Leader Bill Frist (R-Tenn.). 

Vogel added that the White House will then have to sell the pay-fors to moderate Democrats such as Manchin.

“The politics aren’t pretty for them internally, but it may be the only game in town. The calendar is not working in their favor,” Vogel said.

A bipartisan deal could be advantageous for Biden, who campaigned on his ability to work across the aisle with Republicans and get things done, as demonstrated by years of experience as a senator and vice president. 

Democrats view the negotiations as an opportunity to show voters that Biden is willing to work with Republicans in good faith, even if a deal ultimately is not reached.  

Manley argued that it would not represent a political setback for Biden if he is unable to strike a deal with Republicans on infrastructure and said the bill, if passed, could help Democrats at the ballot box in 2022. 

“In the end, the only thing that’s going to count is getting something done,” Manley said.