Republicans draw ‘red line’ in negotiations with Joe Biden on infrastructure package

WASHINGTON — Republican leaders drew a line Wednesday in negotiations with President Joe Biden on a massive infrastructure package, calling an increase to corporate taxes a “non-starter” and saying they’re only willing to pay for physical infrastructure such as roads, bridges, airports and broadband expansion.

For 90 minutes, Biden met in the Oval Office with the “Big 4” legislative leaders from both chambers including Republican Senate Leader Mitch McConnell and House Republican Leader Kevin McCarthy. But the meeting did not appear to lead to a major breakthrough as Biden seeks more than $4 trillion in spending.

Biden’s sweeping $2.3 trillion American Jobs Plan would include billions for caregiving for seniors and the disabled, the expansion of electric vehicles, research and manufacturing and other investments on top of traditional infrastructure. He’s also pushing $1.8 trillion in investments for families and children.

“Not to negotiate here, but you won’t find any Republicans who’s going to go raise taxes,” McCarthy told reporters outside the White House after the meeting. “I think that’s the worst thing you could do in this economy when you watch inflation.”

President Joe Biden speaks during a meeting with congressional leaders in the Oval Office of the White House, Wednesday, May 12, 2021, in Washington. From left, House Minority Leader Kevin McCarthy of Calif., Senate Minority Leader Mitch McConnell of Ky., Vice President Kamala, Biden, House Speaker Nancy Pelosi of Calif., and Senate Majority Leader Chuck Schumer of N.Y. (Photo: Evan Vucci, AP)

House Speaker Nancy Pelosi, Senate Leader Chuck Schumer and Vice President Kamala Harris were also on hand for the meeting, which came shortly after Republicans moved to oust Rep. Liz Cheney, R-Wyoming, from House GOP leadership. 

The president wants Congress to raise the corporate tax rate from 21% to 28% to pay for the jobs and infrastructure package, undoing tax cuts that former President Donald Trump and Republicans passed in 2017. 

“We’re not interested in reopening the 2017 tax bill,” McConnell said. “We both made that clear to the president. That’s our red line.”

Despite the disagreement over taxes, McCarthy and McConnell described the meeting as productive. McConnell said there’s a “bipartisan desire to get an outcome.” Yet they also made clear they don’t support the so-called “human infrastructure” and “social infrastructure” components in Biden’s package. 

“I think there’s an opportunity to work together on infrastructure,” McCarthy said, but added that both parties needed to start with addressing what defines infrastructure. He said it shouldn’t include “home help,” but rather roads, bridges, highways, airports and broadband. “Those are the places we can find common ground to work together.”

McConnell last week said he’s “100%” focused “on stopping” the Biden administration. Senate Republican have proposed a $568 billion infrastructure counteroffer limited to only physical infrastructure. Although the GOP plan doesn’t specify how to pay for the spending, Republicans have suggested user fees – something Biden flatly opposes. 

McConnell suggested using a portion of $350 billion in direct aid headed to state and local governments in Biden’s American Rescue Plan, approved in March, to pay for infrastructure: “Hopefully, we can capture some of that to make this infrastructure package go forward.”

Sen. Joe Manchin D-West Virginia, a key swing vote in the evenly divided Senate, has proposed a smaller corporate tax rate increase to 25%, which the White House has indicated it’s willing to consider.

House Minority Leader Kevin McCarthy of Calif., listens as Senate Minority Leader Mitch McConnell of Ky., speaks to reporters outside the White House after a meeting with President Joe Biden, Wednesday, May 12, 2021, in Washington. (Photo: Evan Vucci, AP)

Biden seeks ‘some consensus on a compromise’ 

Pelosi was upbeat following the meeting, saying she’s “more optimistic now” about being able to pass an infrastructure package “in a bipartisan way.” She said the meeting “took us a few steps forward” and that the president was sincere about his commitment to find common ground. 

“We want to build the infrastructure of America. We have to stipulate as to what that would include,” Pelosi said, adding that one area opposed by the Republican leaders in the meeting was electric vehicles. 

Biden’s plan would direct $174 billion to electric vehicles through the construction of a national network of 500,000 electric vehicle stations, replacing diesel vehicles, electrifying bus fleets and offering tax incentives and rebates to make electric cars more affordable. 

“But again, we didn’t go through a list and say ‘yes’ on this and ‘no’ on that,” Pelosi said. “But that emerged as something they might not be too fond of.”

Biden has billed the sweeping jobs proposal as a domestic investment not seen in the U.S. since the construction of the interstate highways in the 1950s and the space race a decade later.

The plan seeks to reshape an American economy struggling amid the coronavirus pandemic, while positioning the United States to fight climate change and out-compete China in manufacturing. It would pump billions into rebuilding roads, bridges and rail with a dual goal of creating millions of “good-paying union jobs.”

US President Joe Biden meets with members of Congressional Leadership to discuss policy areas of mutual agreement, in the Oval Office of the White House in Washington, DC, on May 12, 2021. (Photo: NICHOLAS KAMM, AFP via Getty Images)

Kicking off Wednesday’s meeting in front of reporters, Biden said, “The bottom line here is: We’re going to see whether we can reach some consensus on a compromise.” Asked how he will make that happen, Biden joked,“Easy. Just snap my fingers. It will happen.”

Though Biden has said he wants to pass his infrastructure bill with Republican support, he could try to pass the American Jobs Plan with a simple Democratic majority in the Senate via budget reconciliation. It would block any attempt at a filibuster waged by Republicans and mean no Republican votes would be needed to pass a package as long as Democrats are all on board.

Such a path would mirror how Biden won approval of his $1.9 trillion COVID-19 rescue plan in March after talks with Republican fizzled.

In addition to the jobs plan, Biden has proposed a $1.8 trillion “families plan” to boost the federal social safety-net with measures to subsidize child care, make prekindergarten universal, offer free community college nationally and create a national paid family leave program. The White House has not said whether it wants to submit the proposal together with infrastructure in a single bill or separately. 

In a readout of Wednesday’s meeting, the White House gave few details, saying Biden enjoyed the meeting and worked with them to identify where they could collaborate on infrastructure. The president told the leaders the “American people expect us to put the interests of families above our disagreements.”

“The President also emphasized that whatever differences exist between the parties, the real competition is between the United States and the rest of the world, and that other countries are not waiting for us to equip our people to win in the 21st Century,” according to the White House.

Biden and Democrats have said they want to see progress on the jobs and infrastructure plan in Congress by the end of May and passage this summer.

Biden is set to continue bipartisan talks on infrastructure Thursday when he will meet with a group of six Republican senators including Sen. Shelley Moore Capito, R-West Virginia, who is leading the Republican efforts. 

Staff reporter Courtney Subramanian contributed to this report. Reach Joey Garrison on Twitter @Joeygarrison.

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