Eric Davis: Infrastructure bill faces hurdles
At the end of March, President Biden outlined the elements of his “American Jobs Plan,” a package of more than $2 trillion in federal spending over eight years on infrastructure, broadly defined. The program is intended to rebuild the economy, create millions of new, well-paying jobs, and better position the United States for international economic competition, particularly with China, but also with other European and Asian economic powers. Much of the American Jobs Plan would be paid for by increasing corporate taxes over a 15-year period.
This proposal will take much longer to go through Congress than the American Rescue Plan stimulus bill that Biden signed less than two months after taking office. The elements of the American Jobs Plan need to be translated into legislative language by many Congressional committees. The Congressional leadership and the White House have still not decided whether to package these elements as a single bill, or as multiple pieces of legislation.
The Democrats’ narrow House and Senate majorities mean that individual members of Congress will have a great deal of leverage over the content of whatever is brought to the floor. For example, a group of Democratic House members from the high-tax states of New York and New Jersey have said they will not support any infrastructure package that does not include restoration of the deductibility of state and local income and property taxes that was repealed by the Republican Congress in 2017 as part of the Trump tax cuts.
In the Senate, Joe Manchin of West Virginia, arguably the most influential member in the 50-50 Senate, has said that while he supports extensive infrastructure spending, he does not favor rolling back the 2017 corporate tax cuts, and would like the Senate Democratic leadership and the White House to negotiate with Republicans to come up with a plan that could get 60 votes in the Senate and would not have to be passed by reconciliation.
With congressional consideration of the American Jobs Plan probably extending through much of the spring and summer, final action on the White House’s proposals is unlikely to occur before Congress’ August recess. That means that infrastructure could become part of a huge legislative package that will need to be passed before a Sept. 30 deadline, including government funding for the 2021-22 fiscal year, raising the federal debt limit, and extending some of the benefits in the stimulus bill, such as expanded child tax credits, beyond the end of this year.
Meanwhile, state and local officials, in Vermont and around the nation, will wait to see what sort of bill finally makes it to President Biden’s desk, and what the provisions of that bill will mean for state and local programs.
A fact sheet prepared by the White House shows some of the ways in which the President’s proposals could provide grants to Vermont:
• Improve 666 miles of highway in poor condition, and repair or replace 66 deteriorating bridges;
• Improve the resiliency of Vermont’s water infrastructure to lessen the impact of future extreme weather events such as Tropical Storm Irene;
• Increase the supply of affordable housing in Vermont, where, because of a shortage of housing, more than 30,000 households are paying more than 30% of their income on rent;
• Provide funding to extend high-speed broadband service to those locations — estimated to encompass well over 100,000 people — where minimally acceptable internet speeds are not currently available;
• Increase the availability of child care facilities throughout the state, which could come about by repurposing buildings no longer needed for K-12 education into early learning centers; and
• Substantially increase investment in weatherization assistance programs to upgrade homes to make them more energy efficient. The combination of older housing stock and cold winters means that Vermont has one of the highest percentages in any state of households spending more than 10% of their income on home energy costs.
Eric L. Davis is professor emeritus of political science at Middlebury College.
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