- Joe Biden’s economic advisors are drafting a proposal to recommend $3 trillion of more spending.
- The New York Times reports the White House may split its colossal infrastructure plan in two.
- The first part would focus on infrastructure and climate, the second may set up universal pre-K.
- See more stories on Insider’s business page.
Instead of pushing a single colossal spending bill through Congress, President Joe Biden’s advisers are reportedly expected to present a proposal this week that includes $3 trillion in spending aimed at boosting the economy and fighting climate change through separate legislative pieces.
The New York Times first reported that Biden’s economic advisers plan to recommend as much as $3 trillion to narrow economic inequality, reduce carbon emissions, and improve American manufacturing, beginning with an infrastructure bill. They cited people familiar with the plan, along with documents outlining its provisions.
The documents said the proposed package would spend heavily on infrastructure improvements, with nearly $1 trillion in spending alone for roads, bridges, electric vehicles, and more.
The second plan would be people-focused and spend heavily on education and programs to increase the participation of women in the labor force, including free community college, universal pre-K education, and a national paid leave program. Those elements are targeted at encouraging people to reenter the workforce and strengthen the overall economic recovery.
Administration officials said that while details on funding for the package are not yet determined, it might be financed by tax increases on the wealthy. Biden has already indicated that he would include a federal tax hike on high-earners in his next big economic package, which would be the first major federal tax hike in nearly three decades.
Insider’s Juliana Kaplan reported today that Biden is likely to look at tweaks to the current tax code, instead of a new tax targeting wealth.
But whether Republicans will support one big bill, or a series of legislative pieces, depends largely on funding, and Republican lawmakers have already indicated they will not support a tax hike on the rich.
“I don’t think there’s going to be any enthusiasm on our side for a tax increase,” Senate Minority Leader Mitch McConnell told reporters last week. The Republican opposition to tax increases could prompt Democrats to bypass the GOP using reconciliation, the same tactic used to enact the $1.9 trillion stimulus law, but passing it in this more piecemeal way could win bipartisan approval for certain aspects of the spending.
Groups of lawmakers from both parties have already met with Biden to discuss an upcoming infrastructure bill.
Democrats, like Rep. Peter DeFazio, the chair of the House Transportation and Infrastructure Committee, suggested using reconciliation in a CNBC interview to pass the next bill, but Rep. Sam Graves, ranking member of the House Infrastructure panel, said in a statement that it “cannot be a ‘my way or the highway’ approach like last Congress.”
Moderate Democratic Sen. Joe Manchin, however, said in an “Axios on HBO” interview that an infrastructure bill could be as large as $4 trillion if it’s funded by tax hikes, but would not support reconciliation.
“I’m not going to do it through reconciliation,” Manchin said. “I am not going to get on a bill that cuts them [Republicans] out completely before we start trying.”
The White House did not immediately respond to Insider’s request for comment.
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