U.S. Senate approves bipartisan $1.2 trillion infrastructure bill, Arkansas lawmakers vote “no”

U.S. Senate approves bipartisan $1.2 trillion infrastructure bill, Arkansas lawmakers vote “no”

BCN Executive Editor Wesley Brown – Aug. 13, 2021 — Bipartisan legislation to repair the nation’s crumbling transportation at a cost of more than $1 trillion was approved on Tuesday by a vote of 69-30 in the U.S. Senate, but without the support of Arkansas Sens. John Boozman and Tom Cotton, both Republicans.

Among many things, H.R. 3684, known as the Infrastructure Investment and Jobs Act, would finance the upgrade of the nation’s roads, bridges, passenger and freight rail, transportation safety, transit, broadband, ports and waterways, airports, drinking water and wastewater, and energy grid.

The lion’s share of the federal infrastructure fund would provide nearly $550 billion in new spending over five years for so-called transportation surface programs operated by the U.S. Department of Transportation, Federal Communications Commission, U.S. Energy Department, and other federal agencies. Current authorizations for such programs are set to expire on Sept. 30, the last day of fiscal 2021.

Today, the nation’s transportation systems are comprised of highways, roads, bridges, waterways, ports, and airports. Other infrastructure systems facilitate drinking water and wastewater. Energy infrastructure moves electricity to residential and commercial customers.

While state and local governments account for a majority of public infrastructure spending, the federal government has historically invested in transportation and water infrastructure. According to the Congressional Budget Office, in 2017, the federal government spent approximately $98 billion on transportation and water infrastructure, compared to $342 billion by state and local governments.

The last long-term reauthorization for surface transportation programs was the 2015 Fixing America’s Surface Transportation Act, which expired at the end of fiscal year 2020. In Dec. 2020, Congress passed a one-year extension of the FAST Act as part of annual appropriations legislation that expires next month.

In approving the broad infrastructure package that he played a lead role negotiating with Democratic Sen. Joe Manchin of West Virginia, Republican Sen. Rob Portman of Ohio U.S. said HR 3684 represented the largest investment in core infrastructure in our nation’s history.

“America’s infrastructure is in desperate need of repair and today’s vote brings the American people closer to more efficiency and safety in their roads, bridges, ports and other important assets,” said Portman, who led 29 Republicans to support the bill. “In addition, the Infrastructure Investment & Jobs Act will create jobs, increase productivity, and pave the way for decades of economic growth and prosperity – all without raising taxes or increasing inflation.”

In a Zoom call on Thursday at the White House with mayors, tribal, municipal leaders and governors from across the U.S. President Biden thanked the Senate for passing key the bipartisan infrastructure bill and the larger $3.5 budget resolution, which he called “the framework for his “Build Back Better” economic agenda.

“(This) bill makes key investments to put people to work in cities, small towns, and rural communities. I believe it’s a historic investment in roads and rail, in transit and bridges, in clean energy and clean water. And it’s going to enable us not only to build back, but to build back better than ever before,” said Biden. “That’s what this infrastructure is all about today. We’re going to need to build the infrastructure for tomorrow, not just today. We got to build back not just — I know you’re tired of hearing me say it, but build back better than it was before we hit this God-awful circumstance we found ourselves in.”

Boozman and Cotton’s beef with Biden budget bill

Despite Biden’s approval and 19 Republican senators backing HR 3684, Arkansas’ two senators were among the 30 “no” votes for the massive appropriations proposal. Boozman issued two statements in vocal opposition of the $1.2 trillion spending measure and companion $3.5 trillion budget resolution for fiscal 2022, which begins Oct. 1.

“I have long supported responsible infrastructure investment, but this bill increases deficit spending with too little to offer in return. Hardworking Arkansans are paying more for groceries, gas and other everyday goods, yet this legislation ignores that reality and piles up more costs that threaten to make living even more unaffordable,” Boozman said on Aug. 10 after HR 3684 was approved. “I’m disappointed we couldn’t reach a fiscally responsible solution to modernize and upgrade roads and bridges, water systems and broadband deployment, but instead are choosing to increase the burden on future generations of Americans to pay for more spending that’s occurring right now, while also paving the path for a $4.2 trillion spending spree of liberal wish list items.”

Concerning the $3.5 budget proposal that was adopted by the Senate on Wednesday, Boozman called the shell bill still needs House approval “a massive government overreach that will put Washington in charge of our everyday lives all while forcing hardworking Arkansans to foot the bill.”

While not law, both the House and Senate must approve the budget resolution, which establishes various budget totals, allocations, entitlements, and may include reconciliation instructions to designated House or Senate committees. Once approved, the House and Senate appoints a select group of representatives and senators to negotiate and reconcile any differences between the two budget versions in a conference report. For the budget to become binding, the final proposal must be approved by both the House and Senate.

“On the heels of so-called COVID-19 relief, the Biden administration continues its out-of-control spending spree that will further fuel inflation and make it more difficult for Arkansans to make ends meet,” said Boozman, Arkansas’ senior congressman. “Ultimately, this bill advances a left-wing agenda that includes amnesty, the Green New Deal and enormous tax hikes that threaten the livelihoods of families, small business and agricultural producers. Arkansans rightfully reject this partisan takeover.”

Although not as vocal as Boozman, Cotton also did not back the bill that former President Donald Trump called a “gift to Democrats” that also enjoyed the support of Senate Minority Leader Sen. Mitch McConnell of Kentucky and one-third of the Republican Senate Conference.

“Arkansans support real infrastructure projects like roads, bridges, waterways, rural broadband, and ongoing maintenance,” said Cotton. “They do not want President Biden’s ‘social infrastructure’ and climate alarmism, especially under the threat of increased inflation and higher taxes.”

With strong Senate backing, HR 3684 and the $3.5 trillion budget proposal now moves to the U.S. House where Democratic House Speaker Rep. Nancy Pelosi has the difficult job of keeping the Democratic Party’s progressives and moderates on the same page. Already, nine Democratic moderates have communicated to Pelosi they would not back the 2022 budget proposal until the smaller $1.2 trillion infrastructure legislation is voted on separately, enacted into law, and signed by President Biden.

On the other side, Pelosi and Democratic progressives are pushing for HR3684 to be considered first or both bills brought to the House floor together. With a thin margin in the House of only three votes over the Republicans, Pelosi must find a way to keep the House Democrats together and get both bills approved by the House with few changes.

Rising federal deficit

According to an analysis released on Thursday (here) the Congressional Budget Office, HR 3684 over the next decade would decrease direct spending by $110 billion, increase revenues by $50 billion, and increase discretionary spending by $415 billion. Altogether, the legislation would add $256 billion to projected deficits over that period.

Under both Biden and former President Donald Trump, programs and policies implemented in response to the coronavirus pandemic—notably, refundable tax credits, expanded unemployment compensation, and the Small Business Administration’s Paycheck Protection Program—substantially boosted spending in fiscal 2020 and 2021.

In addition, recent CBO estimates show that President Trump’s 2017 Corporate Tax Cut and Jobs Act supported by Boozman and Cotton and Arkansas four House members will also increase the deficit by $1.9 trillion over the 2018–2028 period. That estimate considered all changes to revenues and outlays, including the effects of macroeconomic feedback and changes in debt-service costs.

That law, among many things, cut the corporate rate from 35% to 21%, repealed the alternative minimum tax (AMT), transformed the taxation of foreign source income, introduced expensing of equipment investment, and allow corporations to take a new deduction for qualified income earned in pass-through organizations. It also temporarily reduced personal income tax rates, eliminated the personal and dependent exemption, increased the standard deduction, and expanded the child credit.

Overall, the federal budget deficit was $2.5 trillion in the first 10 months of fiscal year 2021, the Congressional Budget Office estimates—$269 billion less than the deficit recorded during the same period last year. By the end of this fiscal year on Sept. 30, if current laws governing taxes and spending remain unchanged, the budget deficit will reach $3 trillion, CBO estimates, the second largest shortfall since 1945.

That amount is nearly $130 billion less than the deficit recorded in 2020 but triple the shortfall recorded in 2019. Relative to the size of the economy, CBO projects, this year’s deficit will total 13.4% of gross domestic product, a share exceeded only by the 14.9% recorded last year.


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