July 28, 2021

It appears that it is finally infrastructure week.

Today, negotiators hammered out a deal on a bipartisan bill, which includes $550 billion in new spending. This evening, the Senate voted to move the bill forward by a vote of 67 to 32, with 17 Republicans joining all the Democrats to begin debate on the measure.

The bill is not fully hammered out yet, and the Congressional Budget Office, which examines bills to see how much they will cost, has not yet produced a final number, but it appears that the bill will cost about $1.2 trillion over 8 years. It puts together unspent monies from other programs and from new “user fees” to pay for it, but Republicans demanded that funds to increase funding for the IRS to enable it to crack down on tax cheats, who cost the United States about $1 trillion a year, be stripped from the bill. 

The White House said the bill would create about 2 million “good-paying” jobs a year for the next decade. It provides $110 billion for roads and bridges, $39 billion for public transit, $66 billion for passenger rail, $73 billion to upgrade the electrical grid; $7.5 billion for electrical vehicle chargers on highway corridors, $17 billion for rebuilding our ports, $50 billion for addressing climate change and cybersecurity, and $55 billion for clean drinking water. 

The bill also calls for $65 billion to expand broadband internet, tying all Americans into the same grid and lowering prices. In the White House statement, Biden explicitly tied the expansion of broadband to the nation’s 1936 expansion of access to electricity through the Rural Electrification Act. Through that act, the government tried to level the playing field between urban Americans who had electricity through private companies and rural Americans who did not because the profit margins weren’t high enough to make it worthwhile for private companies to bring electricity to them.

Electrification not only enabled rural Americans to enjoy the new products created in the early twentieth century, but also created a new industry of consumer products that helped the post–World War II economy boom. Then, as now, federal funding for a vital infrastructure need opened up the door to government oversight and regulation of that utility, a principle that today’s Republicans oppose, especially when it comes to broadband. (It’s an interesting thought, though: could regulation of publicly supported broadband help address the problem of disinformation on social media?) 

That is only one of the ways in which this bipartisan bill remains precarious. There are others. It is always possible that the Republicans cannot muster the 10 votes they need to pass the bill, and continuing to tinker with it is simply a way to run out the clock on the congressional session so that the Democrats cannot get the infrastructure deal they want so badly. 

From the other direction, progressive Democrats have made it clear they will not accept this bill, which focuses on “hard” infrastructure like roads and bridges, unless it goes along with a larger “soft” infrastructure bill that focuses on human infrastructure. There are not enough Republican votes to pass that second measure over a Senate filibuster, so it will have to pass the Senate through budget reconciliation, which requires only a simple majority. But that means it will need all 50 Democratic votes, and today Arizona Senator Kyrsten Sinema said she does not support the bill in its current form. She apparently wants adjustments, but what they are and whether progressives will accept them remains unclear.

Still, the idea of this new, sweeping infrastructure package becoming reality is huge. Former president Donald Trump, who wanted badly to pass an even larger infrastructure bill during his own term of office but who couldn’t do so, has responded to the idea that Biden might manage to pull this off with a demand that Republicans scuttle the entire thing. That several prominent Republicans are ignoring him illustrates the potential of this deal to weaken the Trump supporters in the party as the weight begins to shift toward measures that are popular with voters and away from the party’s more common obstructionism.

News of this historic investment in the country happened to come on the same day researchers Laura Wheaton, Linda Giannarelli, and Ilham Dehry of the Urban Institute think tank, established by the Lyndon Johnson administration to study the results of antipoverty laws passed during its years in power, published a study of the effects of the American Rescue Plan.

That $1.9 trillion economic stimulus package, passed without a single Republican vote and signed into law by President Joe Biden on March 11, 2021, was projected to reduce the annual poverty rate to 8.7% for 2021—it had been 13.9% in 2018—and to cut child poverty by more than half. The new study shows that, in fact, the poverty rate for 2021 looks to be on track to hit 7.7%. The study’s authors project the 2021 poverty rate to be highest for Hispanic people (11.8%), non-Hispanic Asian American and Pacific Islanders (10.8%), and Black, non-Hispanic people (9.2%). For white, non-Hispanic people, the rate is projected to be 5.8%.

The study pointed to federal stimulus checks as the more important piece of this development. Those checks alone raised 12.4 million people out of poverty. Taken all together, recent antipoverty measures reduced child poverty from 30.1% to 5.6%. 

For all that other issues are getting more dramatic headlines, the infrastructure bill marks a sea change from the past forty years of slashing government investment and regulation to the more traditional vision of a government that promotes the general welfare. The latter vision was behind the Rural Electrification Act that, more than eighty years later, still shapes the national economy. Getting today’s Republicans to sign onto such a measure would be momentous indeed.

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Notes:

https://www.npr.org/2021/07/28/1021768174/bipartisan-senate-negotiators-say-they-reach-a-deal-on-infrastructure-after-hicc

https://www.washingtonpost.com/politics/senators-white-house-in-talks-to-finish-infrastructure-bill/2021/07/27/6f22d026-ee9b-11eb-81b2-9b7061a582d8_story.html 

​​https://thehill.com/opinion/finance/564860-public-private-partnerships-key-to-providing-high-quality-broadband-to-all

https://www.urban.org/research/publication/2021-poverty-projections-assessing-impact-benefits-and-stimulus-measures