Republican leadership drew a “red line” in the negotiations over the president’s infrastructure plan, insisting it not raise corporate taxes or change anything from the 2017 tax bill passed under former president Trump.
Congressional leaders from both parties met with President Biden and Vice President Kamala Harris on Wednesday to discuss the White House’s proposals for infrastructure spending, which the administration has dubbed the “American Jobs Plan.” The top Republicans in Congress, Senate Minority Leader Mitch McConnell and House Minority Leader Kevin McCarthy, attended, as did the top Democrats, House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer.
The infrastructure proposal includes spending on the country’s roads, bridges and airports, in addition to bringing clean water to communities who desperately need it. The bill also addresses what the administration calls “care” infrastructure, such as home and community care for veterans, disabled people and seniors, as well as upgrading and building new child care facilities to help working parents — all of which Republicans claim is not infrastructure.
Biden hopes to pay for the more than $2 trillion plan through tax increases, although he has promised not to raise taxes on people making less than $400,000 per year. To fund the plan, the administration has proposed raising the top corporate tax rate from 21 percent to 25-28 percent (before the 2017 tax cut, it was 35 percent), raising the global minimum tax for U.S. multinational corporations that go offshore and closing tax loopholes. But that’s where Republicans are balking, protecting their tax bill from 2017, which the Tax Policy Center estimates is adding $1 to $2 trillion to the federal deficit. The tax bill contained some tax decreases for most people, but the overwhelming majority of the cuts — at Trump’s insistence and with support from nearly all Republicans — went to corporations and the wealthy.
But would Republicans, who insist they’re very concerned about deficits, be willing to bend some of those tax cuts to help fund things that keep the economy growing and keep life livable for millions of people?
“We’re not interested in re-opening the 2017 tax bill. We both made that clear with the president. That’s our red line,” McConnell told reporters after the meeting. “This discussion… will not include revisiting the 2017 tax bill.”
“You won’t find any Republicans going to go raise taxes,” McCarthy said, adding, “I think it’s the worst thing to do in this economy.”
In this economy, parents are struggling to find care for their children as they return to the workplace. In this economy, communities are still drinking water from lead pipes. These are problems the country can fix, but you won’t hear McCarthy or McConnell talking about these issues when they have tax cuts to protect.
“I’m generically encouraged that there’s room to have a compromise on a bipartisan bill that’s solid and significant,” Biden said to reporters after the meeting. But, in a later MSNBC interview, he signaled he is open to pushing forward without Republicans. “Let’s see if we can get that agreement to kick-start this and then fight over what’s left, and see if I can get it done without Republicans if need be,” Biden said.
The president has been meeting with moderate Democrats to get their support, and he met this week with Democratic Senators Kyrsten Sinema and Joe Manchin. Passing the bill along partisan lines may become Biden’s only choice if Republicans continue to refuse to cede ground, which is likely, considering what McConnell told the Louisville Courrier Journal just last week: “One hundred percent of my focus is standing up to this administration.”