Senate passes boost for infrastructure in victory for Biden

[WASHINGTON] The Senate passed a US$550 billion infrastructure plan that would represent the biggest burst of spending on US public works in decades and notch a significant victory for President Joe Biden's economic agenda.

The bipartisan 69-30 vote Tuesday was a breakthrough that has eluded Congress and presidents for years, despite both parties calling infrastructure a priority and an issue ripe for compromise.

Senate passage of the infrastructure Bill came after months of negotiations and days of slow-moving Senate debate during which Republicans opposed to the legislation forced Democrats to run out the clock on procedural motions.

"It's been a long and winding road but we have persisted and now we have arrived," M r Schumer said before the vote. The spending in the legislation will "strengthen every major category of our country's physical infrastructure.'

The Bill still faces hurdles in the House, which is scheduled to be on break until Sept 20. House Speaker Nancy Pelosi, under pressure from progressives who want their priorities addressed, has said she will not allow a vote on the bipartisan package until the Senate has passed the broader economic plan. Moderates, meanwhile, are clamoring for the House to take up the Bill sooner than that. The House may also seek changes to the infrastructure Bill.

Still, the Senate vote after months of fraught negotiations was a crucial first step for both Mr Biden's economic agenda and his broader hopes of showing the world Washington can work again to solve big problems after a particularly divisive era in American politics.

If the infrastructure package ultimately clears both chambers, every state would feel the effects. It includes about US$110 billion in new spending for roads and bridges, US$73 billion for power grid upgrades, US$66 billion for rail and Amtrak, and US$65 billion for broadband expansion. It also provides US$55 billion for clean water and US$39 billion for transit.

Mr Biden had dispatched top aides to negotiate directly with a group of Republican and Democratic senators putting the Bill together and engaged personally with meetings and phone calls. The vote also is a significant achievement for Mr Schumer and the bipartisan group of 22 senators led by Republican Rob Portman of Ohio and Democrat Kyrsten Sinema of Arizona, who stepped in after initial negotiations between the White House and Republicans collapsed in June.

Republicans can claim a victory in that the package includes big spending on their priorities without raising taxes, while Mr Biden can lay claim to an accomplishment decades in the making without including unpopular gas taxes or other levies that would have hit the middle class.

The Congressional Budget Office said the infrastructure legislation would add US$256 billion to the federal budget deficit over the next decade. The CBO has previously forecast the deficit would hit US$3 trillion this year alone before narrowing to US$1.15 trillion in 2022.

Republicans who opposed the plan as too expensive cited the CBO's prediction of additional debt and warned the Bill could spur additional inflation.

But some of the senators who drew up the legislation contended the Bill would be paid for by a variety of means that the CBO couldn't account for.

"The new spending under the Bill is offset through a combination of new revenue and savings, some of which is reflected in the formal CBO score and some of which is reflected in other savings and additional revenue identified in estimates, as CBO is limited in what it can include in its formal score," Mr Portman and Ms Sinema said in a joint statement.

With the bipartisan deal out of the Senate, Mr Schumer will turn immediately to the task of teeing up consideration of Mr Biden's $3.5 trillion economic package, a partisan drive to overhaul policies on climate change, taxes, health care, immigration and other areas.

Mr Schumer plans to force a vote on the fiscal blueprint that helps them trigger a Senate procedure that would short-circuit a GOP filibuster. Republicans in turn can make the process painful by forcing numerous amendment votes via an all-night process knows as a vote-a-rama.

The Biden administration and Democratic leaders want to pack that resulting package, which would move forward after the August recess, with tax hikes on the wealthy and corporations to pay for spending on a broad social agenda, including child care, middle class tax cuts, paid family leave and subsidies for higher education.

But Mr Biden and Mr Schumer will need every Democratic vote in the 50-50 Senate, including moderates like Joe Manchin of West Virginia and Ms Sinema, who insisted on and led the push for the bipartisan deal but aren't sold on the price tag or all of Mr Biden's proposed tax hikes.

BLOOMBERG