Capito had offered an infrastructure proposal that totaled $928 billion in spending over eight years, but only about a quarter of that was new spending. The offer came after Biden lowered his initial $2.3 trillion demand to $1.7 trillion, and the White House pushed Republicans to come up to $1 trillion in new spending.
While the White House and Senate Republicans have spent weeks negotiating, both sides remain far apart on the top line, along with pay-fors and the definition of “infrastructure.” The White House had outlined a plan to pay for the package by revising the 2017 tax bill and increasing the corporate tax rate to 28 percent from 21 percent, a non-starter for the GOP.
During his meeting with Capito on Wednesday, Biden suggested negotiators could instead impose a new corporate version of the alternative minimum tax, set at 15 percent. He also called for $1 trillion over current spending levels, which Republicans viewed as a step in the wrong direction. Senate Republicans have proposed paying for the infrastructure bill through user fees and unspent coronavirus relief money, but Democrats are rejecting that idea.
Following Friday’s phone call, a spokesperson for Capito said the “two discussed the Republican infrastructure framework and the Biden administration’s proposal,” but did not elaborate on the details of the conversation.
The ongoing discussions come as progressives are pushing for Biden to move forward with the so-called reconciliation process, which would allow Democrats to pass the infrastructure package without Republican votes in the Senate. Speaker Nancy Pelosi (D-Calif.) has said she wants to pass a bill by July 4 and Senate Majority Leader Chuck Schumer (D-N.Y.) suggested recently that the Senate would be working on an infrastructure package during the month of July.
In her statement late Friday afternoon, Psaki said that Biden had also spoken with Rep. Peter DeFazio, chairman of the House Transportation and Infrastructure Committee, and that the president offered “his support for the committee mark-up” of a surface transportation reauthorization.
“The President and Chairman DeFazio agreed on the benefits of continued engagement with Democratic and Republican Senators as the House work on infrastructure advances this coming week,” Psaki said.
Even as liberal Democrats are pushing for Democrats to go it alone, it’s not clear that Senate Democrats have the votes at the moment for reconciliation. Sen. Joe Manchin (D-W.Va.) told NBC News this week that he did not think Democrats should move forward without Republicans on infrastructure.
