Infrastructure Talks Continue as Senate Ruling Makes Reconciliation Difficult
Discussions over a bipartisan infrastructure deal have entered a critical stage as the Biden administration negotiates with Senate Republicans, with progressive Democrats increasing pressure on the White House to pass legislation with only Democratic votes. The White House and Senate Republicans remain at odds on major issues but have continued to seek an agreement. Republicans oppose inclusion of what they consider non-infrastructure spending, such as long-term care for seniors and people with disabilities, in an infrastructure deal. The White House and Democrats have used the term “human infrastructure” to refer to these initiatives. Both sides also continue to argue over the funding mechanism, with President Joe Biden originally proposing an increase in the corporate tax rate from 21% to 28%, but recently dropping that in favor of a 15% global minimum corporate tax as a means of paying for the infrastructure plan.
Biden received a boost over the weekend when the finance ministers of the world’s most advanced economies, referred to as the Group of 7, adopted the call for a 15% tax on corporate earnings. However, a ruling by the Senate parliamentarian limits the ability of Senate Democrats to use the budget reconciliation process to override Republican opposition to an infrastructure package, complicating Democratic plans to use the procedural maneuver to advance the White House’s agenda.