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Biden needs Republican Capito to extend counteroffer

Biden wants Republican Capito to increase counteroffer

United States President Joe Biden will address the Middle East on May 20, 2021 at the Cross Hall of the White House in Washington, DC.

Nicholas Comb | AFP | Getty Images

President Joe Biden wants Republicans to increase spending on their infrastructure plan ahead of Friday’s talks that will determine whether Washington can pass bipartisan law to upgrade transportation, broadband and water systems.

During a meeting on Wednesday, Biden told GOP Senator Shelley Moore Capito that he wanted the plan to include $ 1 trillion in new spending – or above the baseline set under the existing policy, NBC News reported. While Republicans recently sent Biden a counteroffer totaling $ 928 billion, it contained only about $ 250 billion in new money.

Biden also reiterated that he plans to fund an infrastructure bill by increasing the corporate tax rate, according to NBC. The GOP opposes any change to its 2017 Tax Act, which cut corporate tax from 35% to 21%. On Thursday, the Washington Post and Reuters reported that Biden had offered to keep the corporate tax rate in place and instead rely on a minimum tax of 15% to curb underpayment for profitable American companies.

Capito, a Republican from West Virginia, shared the details of the meeting with five other Republican senators on her infrastructure negotiation team, NBC reported. The GOP expects to send Biden another counter offer on Friday, the day Biden and Capito want to speak again.

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The priorities outlined by Biden on Wednesday highlight the hurdles negotiators face on the way to a bipartisan deal. Despite weeks of maneuvers, the parties did not agree on what should be included in an infrastructure bill or how the plan should be financed.

The White House has signaled that it could go ahead and try to pass laws only with democratic votes if talks don’t progress by next week. Energy Secretary Jennifer Granholm told CNBC on Wednesday that the negotiations were “limited in time”.

However, neither Democrats nor Republicans have shown that they want to be the ones to leave the talks.

The GOP’s $ 928 billion plan was roughly half of Biden’s latest $ 1.7 trillion proposal. Democrats want a bill to go beyond conventional notions of infrastructure, but Republicans have opposed including policies on transport, broadband and utilities.

The White House package includes major investments in care for elderly and disabled Americans, homes, schools, electric vehicles, and clean energy. Democrats have emphasized the need to stimulate the economy over the long term by making it easier for workers to find care for dependent family members and by preparing buildings and critical infrastructure for the effects of climate change.

Republicans intend to limit a plan to investments in areas such as roads, bridges, airports, ports, waterways, broadband and water systems.

Agreeing on how to offset expenses could prove just as difficult as deciding what to include on the bill. Republicans have announced that they will not agree to an increase in corporate taxes. Biden wants to raise the rate to at least 25%.

The White House rejects a GOP proposal to reuse the coronavirus aid money passed by the Democrats earlier this year.

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Biden infrastructure plan: Senate Republicans make counteroffer

Biden infrastructure plan: Senate Republicans make counteroffer

Senate Republicans unveiled their $928 billion infrastructure counteroffer to President Joe Biden on Thursday, as the sides see whether they can bridge an ideological gulf to strike a bipartisan deal.

The plan includes:

  • $506 billion for roads, bridges and major infrastructure projects, including $4 billion for electric vehicles
  • $98 billion for public transit
  • $72 billion for water systems
  • $65 billion for broadband
  • $56 billion for airports
  • $46 billion for passenger and freight rail systems
  • $22 billion for ports and waterways
  • $22 billion for water storage
  • $21 billion for safety efforts
  • $20 billion for infrastructure financing

Biden’s latest offer to Republicans came in at $1.7 trillion — $600 billion less than his original plan. He has urged the GOP to put at least $1 trillion into an infrastructure package.

The White House did not immediately respond to a request to comment on the senators’ offer.

Republicans and the White House have moved closer to agreement on an infrastructure plan but still need to resolve fundamental issues about the scope of a package and how to pay for it, a GOP senator leading the effort said Thursday. Sen. Shelley Moore Capito said the sides are “inching closer” in negotiations ahead of Memorial Day, the date by which the White House wanted to see progress in bipartisan talks.

“We’re still talking. I’m optimistic, we still have a big gap,” Capito told CNBC’s “Squawk Box.” “I think where we’re really falling short is we can’t seem to get the White House to agree on a definition or a scope of infrastructure that matches where we think it is, and that’s physical, core infrastructure.”

“The White House is still bringing their human infrastructure into this package and that’s just a nonstarter for us,” she continued, referencing Biden’s plans to put money into programs including care for elderly and disabled Americans.

U.S. Sen. Shelley Moore Capito (R-W.Va.) asks questions during a Senate Appropriations Subcommittee hearing to examine the FY 2022 budget request for the Centers for Disease Control and Prevention in the Dirksen Senate Office Building in Washington, May 19, 2021.

Greg Nash | Pool | Reuters

It is unclear if the two parties can overcome broad ideological differences over what constitutes infrastructure, and how to pay for improvements to it, to strike a bipartisan deal. If negotiations do not show promise, Democrats will have to decide whether to try to pass an infrastructure bill on their own using special budget rules.

The process would bring its own headaches, as Senate Democrats would have to both keep all 50 members of their caucus on board and comply with strict rules about what can go into a budget reconciliation bill.

Republicans have said they do not want to raise taxes to cover the costs of improving transportation, broadband and water systems. Biden has called to hike the corporate tax rate from 21% — the level set by the GOP after it cut taxes in 2017 — to at least 25%.

“We can do this without touching … those tax cuts,” Capito told CNBC.

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She mentioned that lawmakers could redirect unused coronavirus relief funds to state and local governments to infrastructure, or implement user fees on transportation like electric vehicles. Those Republican solutions could put Biden in a bind.

The president has promised not to raise taxes on anyone who makes less than $400,000 per year. User fees or an increase to the gas tax would put an extra burden on many Americans whose incomes falls under the threshold.

Capito said she sees the potential for bipartisan agreement on transportation spending. She noted that the Senate’s Environment and Public Works Committee — where she sits as ranking member — advanced a roughly $300 billion surface transportation bill that she thinks could guide a broader infrastructure deal.

In trimming his original $2.3 trillion plan, Biden cut out funding for research and development and supply chain enhancements. He also reduced proposed spending on broadband, roads and bridges.

Biden did not cut down the proposed $400 billion for home-based health care. Republicans have criticized that spending as part of an infrastructure package.

This story is developing. Please check back for updates.

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Capito, Senate Republicans to ship counteroffer

Capito, Senate Republicans to send counteroffer

Senator Shelley Moore Capito, a Republican from West Virginia, left, speaks as Senator Roger Wicker, a Republican from Mississippi, center, and Senator John Barrasso, a Republican from Wyoming, listen during a news conference on Capitol Hill in Washington, D.C., U.S., on Thursday, April 22, 2021.

Stefani Reynolds | Bloomberg | Getty Images

A group of Senate Republicans plans to send President Joe Biden an infrastructure counteroffer this week as the sides consider whether they can bridge an ideological gulf to craft a bipartisan bill.

The proposal could cost nearly $1 trillion, and Republicans aim to offset the spending without increasing taxes. The group of GOP lawmakers aims to deliver the plan as soon as Thursday morning.

Hopes for an agreement between the parties to revamp U.S. transportation and broadband appeared to dim last week. After the White House cut its infrastructure offer to $1.7 trillion from $2.3 trillion, an aide to Sen. Shelley Moore Capito, R-W.Va., said the plan’s price tag was “well above the range of what can pass Congress with bipartisan support.”

The Republican group initially put out a $568 billion infrastructure framework last month.

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Democrats will have to decide whether they want to chop up their plan enough to win Republican votes, or try to forge ahead on their own using special budget rules. It is unclear if they would consider passing parts of the proposal with GOP support, then moving to approve other pieces on their own.

The Biden administration has said it wants to see whether it can make progress in bipartisan infrastructure talks before Memorial Day.

Asked after a meeting of the Republicans leading the infrastructure effort if this week’s offer would be the GOP’s last, Capito said she would wait to see how the White House reacted to it. She noted that bipartisan plans that could become part of a broader infrastructure package — including a roughly $300 billion surface transportation bill she helped to craft as ranking member of the Environment and Public Works Committee — are working their way through congressional panels.

“I think that we’ve got good momentum, but we’ll see what [the White House’s] reaction is,” Capito said Tuesday.

The parties need to resolve fundamental issues to come to an accord on infrastructure, one of Biden’s top priorities in the White House. They have disagreed on what should count as infrastructure, as Democrats push for a bill to include policies including care for elderly and disabled Americans.

Biden also wants to pay for the legislation through tax increases on corporations. Republicans have opposed any effort to hike the corporate rate, set at 21% after the 2017 GOP tax cuts.

“We’re not going to have any votes at all to tamper with the 2017 tax bill,” Sen. Roger Wicker, a Mississippi Republican and ranking member of the Senate Commerce Committee, said Tuesday.

Sen. Pat Toomey, R-Pa., on Tuesday suggested using money already approved by Congress but not yet spent. While he did not specify which funds he thinks lawmakers could repurpose, some Republicans have previously suggested using state and local government aid approved as part of coronavirus relief bills.

After Biden met with six Republican senators earlier this month, the sides expressed hope about striking an infrastructure deal. However, an aide to Capito said the administration and Republicans seemed “further apart” after senators met with Biden’s staff.

Capito said the Republicans would be open to meeting with Biden again.

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White Home makes $1.7 trillion infrastructure counteroffer to GOP

White House makes $1.7 trillion infrastructure counteroffer to GOP

WASHINGTON – White House staff working on a bipartisan infrastructure deal made a counter-offer to Republican senators on Friday, cutting the Biden administration’s original proposal by $ 600 billion.

Within hours, these Republicans tossed cold water on the new proposal, saying the sides seemed “further apart” after the apparent progress in the negotiations.

The latest offer would cost $ 1.7 trillion over a decade, according to a White House memo to West Virginia Republican Senator Shelley Moore Capito, who leads negotiations for the GOP.

To reduce the original plan from $ 2.3 trillion to $ 1.7 trillion, the White House agrees:

  • Shift funding for research and development, small business and supply chain improvements from this package to separate laws being discussed in Congress.
  • Reduce rural broadband funding from its original $ 100 billion offering to $ 65 billion. This would be in line with the Republicans’ proposal for expanded broadband funding.
  • Reduction of new funding requests for “roads, bridges and major infrastructure projects” from an original USD 159 billion to USD 120 billion.

The memo said that Biden hoped the proposed changes to his original offer would “fuel further bipartisan cooperation and progress”.

It was immediately apparent, however, that little progress had been made over the past week on the key elements of a bill. This includes the basic definition of “infrastructure” and the payment mechanisms.

Republicans have proposed their own $ 568 billion infrastructure bill, with an emphasis on hard infrastructure, rural broadband, and transit.

In the Biden counteroffer, these are all areas that would be shortened.

An aide for Moore Capito responded to the offer in a statement Friday, still calling the White House proposal “well beyond the realm of what Congress can do with bipartisan support”.

“After today’s meeting, the groups seem further apart after two meetings with White House staff than they did after meeting President Biden,” she said.

The White House memo is also noteworthy for what Biden did not agree to compromise on.

For example, the White House hasn’t stepped back from the $ 400 billion Biden proposed to fund home and community elderly care. Republicans argue that this does not fit the definition of “infrastructure”.

Biden’s offering also includes information on his proposed funding for electric vehicles, veterans hospitals, and labor training, all of which have been questioned by Republicans.

On the pay side, the White House counteroffer still contains one of the GOP’s problems: an increase in the corporate tax rate.

Senate Minority Chairman Mitch McConnell said any infrastructure plan that included a corporate tax increase would be opposed by the entire Republican caucus.

White House press secretary Jen Psaki described Friday’s counterproposal as “the art of looking for common ground.”

Biden’s negotiators presented the counteroffer to Republican senators during a video conference that began shortly after lunch on Friday.

The White House team consisted of Presidential Advisor Steve Ricchetti, Legislative Director Louisa Terrell, National Economic Council Director Brian Deese, Commerce Secretary Gina Raimondo, and Transportation Secretary Pete Buttigieg.

As the second week of formal negotiations ended on Friday, Republicans and Democrats seemed no closer to a bipartisan compromise than they were at the beginning.