Senate Passes Huge Infrastructure Bill, What’s Inside and What About the House?

Today the Senate passed a Bipartisan Infrastructure Bill.  Let’s take a look at the Infrastructure Details. 

Infrastructure Details

• $110 billion would go toward roads and bridges
• $66 billion investment in rail maintenance, modernization and expansion, most of which will go to Amtrak.
• $39 billion to modernize and make public transit more accessible to the disabled and elderly. Significant chunks of that money will go to major city transit systems, like New York City’s, based on federal funding formulas.
• $11 billion in funding for highway and pedestrian safety program
• $65 billion for expanded access to broadband, including by providing low-income households a $30 monthly voucher to pay for internet service.
•  $65 billion allocated for improving the electrical grid and energy production 
• $50 billion to bolster the country’s infrastructure generally against climate change and cyberattacks. 
• $55 billion will go toward clean drinking water 
• $21 billion in removing pollution from soil and groundwater, job creation in energy communities and a focus on economic and environmental justice. T
• $73 billion to update and expand the power grid.
• $7.5 billion will go to implementing a network of electric vehicle chargers
• Another $7.5 billion will be used for zero-emission or low-emission buses and ferries. 
• Ports and airports will be boosted with $42 billion in new spending.

What’s Missing in the $1 Trillion Package?

The above items total approximately $612 billion out of a bill that authorizes roughly $1 trillion (I have not seen an exact number).  

Other specifics are buried in the Text of 2702 Page Bill. Part of the confusion is new spending vs existing spending.

The bill allegedly authorizes about $550 in new spending of which $612 billion is listed above, perhaps with some overlaps.

How Will This Be Paid For?

• $200 billion in repurposed funds originally intended for coronavirus relief but left unused
• About $50 billion will come from delaying a Trump-era rule on Medicare rebates
• $50 billion from certain states returning unused unemployment insurance supplemental funds. 
• The negotiators also expect about $30 billion will be generated from applying information-reporting requirements for cryptocurrency
• Nearly $60 billion will come from economic growth spurred by the spending
• $87 billion from past and future sales of wireless spectrum space. 
• A series of smaller pay-fors are expected to make up the difference.

Funding Goal

The goal appears not to get to $1 trillion but rather to $550 billion in “new” spending.

The above items total $477 billion, the rest is magic, and likely some of that is magic, especially estimates of growth which never seem to pan out.

What About Cryptos?

Details for how some of the revenue streams would work remain controversial and could change in the amendment process this week. Sen. Ron Wyden (D., Ore.), the chairman of the Finance Committee, criticized the cryptocurrency tax provision as “an attempt to apply brick and mortar rules to the internet and fails to understand how the technology works.” Cryptocurrency industry groups have criticized the provision as unclear and warned it could ensnare individuals and companies who don’t have actual customers, such as decentralized exchanges and miners, as opposed to more traditional exchanges that are the primary target of the changes.

What’s Next?

House Majority Leader Steny Hoyer of Maryland has said that House Democrats may want to tweak the bill to include more climate provisions. But he has also acknowledged such a move could put the bill’s chances in jeopardy in the Senate

If the House changes the bill and passes its own version, the Senate will need to vote on the House version. If they cannot pass the House version, the chambers could also go to a conference committee where they would try to bridge the gap.

Mr. Hoyer said Democratic leadership hasn’t yet decided next steps on the specific bill. However, House Speaker Nancy Pelosi of California has said the House will only take up the infrastructure bill once the Senate has also sent over the $3.5 trillion package.

Democrats are likely to be able to lose the votes of some members as the bill is expected to garner some Republican support if it remains the same. The bipartisan Problem Solvers Caucus, which includes 58 members, evenly divided, is expected to endorse the legislation, according to a person familiar with the matter.

Infrastructure Bonanza

All in all this was a bonanza for lobbyists. 

On August 7, I noted Lobbyists Spent $426 million to Reap an Infrastructure Bonanza.

Nearly 2,000 companies and other groups have engaged with Washington officials about infrastructure to shape the final deal.

One group that did not get what they wanted was the crypto lobby.

Destroy American Jobs and Growth Plan

Nancy Pelosi and AOC sa the Democrats $3.5 trillion must past first.

I discussed that on July 30, in AOC Goes After Senator Krysten Sinema With a “No Climate, No Deal” Threat

Biden calls the bill “The American Jobs Plan“. I originally proposed labeling the bill the Stagflation Guarantee Act of 2021 but Destroy  American Job act is also a fitting name.

In addition to untenable clean energy costs, the bill would expand Medicare, offer universal “free” pre-kindergarten, two years of “free” college, and other massive giveaways.

Thus my comment: The Stagflation Threat is Very Real but Congress Holds the Key

Mandating 80% clean energy by 2030 as the Democrats seek is economically crazy. Costs would be enormous and there would be a huge bit to growth. 

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