Compromise on infrastructure package: US Senate wants to invest trillions

The parties in the US Senate had been wrestling for a billion-dollar infrastructure package for months – now President Biden was allowed to announce a deal. But that might not be enough for the Democrats in the House of Representatives.

In the USA, after months of negotiations, an agreement has been reached on a billion dollar infrastructure package. “We have a deal,” said US President Joe Biden after negotiations with both parties. The infrastructure package will create “millions of American jobs”. Originally, he had planned a much more extensive package.

A group of five Senators each from the Democrats and Republicans had recently submitted a compromise proposal in a month-long dispute over massive investments in infrastructure. It provides for spending of $ 1.2 trillion on roads and bridges, as well as broadband, e-car charging points and the power grid. The deal is a big step to compete with China, Biden said later. The democratic majority leader in the Senate, Schumer, who was not involved in the negotiations, signaled general approval.

No new taxes

According to the President’s Office, $ 579 billion in new spending is planned as part of the total. The package should be financed, among other things, with oil sales from the strategic US reserves and auctions of 5G frequencies.

Republican Senator Rob Portman said no new taxes were foreseen in the agreement. Biden specifically ruled out an increase in the gasoline tax, which has remained unchanged in the US at the federal level since the 1990s. More details should be released later in the day.

Originally planned almost twice as much

Biden had originally targeted $ 2.3 trillion for his infrastructure package. However, its Democrats only have a small majority in Congress. In comparison, both parties agree that the bridges and roads in the USA, some of which are ailing, must be modernized. Accordingly, the agreement on a package for “physical infrastructure” emerged recently.

The Republicans reject it, however, that Biden also includes more socially oriented projects – “human infrastructure” – such as more help for children or the fight against global warming in the infrastructure program. Many Democrats, on the other hand, are emphatically calling for this.

Calculated over five or eight years, according to government headquarters, the package will cost $ 973 billion and $ 1.2 trillion, respectively. How exactly these long-term calculations are made up was initially open.

Biden: Agreement is a “compromise”

In any case, the last word on the subject is far from being said. Biden admitted that there was a lot of work to be done to actually turn the plans into reality. He said he had no guarantee that Congress would get enough votes for the agreement. Biden, who had served in the Senate for more than 35 years, emphasized that he knew the processes in Congress only too well. He trusts the Republican senators who were involved in this agreement. And he trusts the common sense of his own party to support a package with good elements, even if it does not contain all the desired concerns.

Biden emphasized that neither side had all of their wishes granted. It is a compromise. The fact that many of his proposals are not included in the current agreement does not mean that he will not continue to fight for them.

However, it was initially unclear whether the second Chamber of Congress, the House of Representatives, would approve the agreement. The Democratic majority leader, Nancy Pelosi, had recently stated that a scaled-down version of the package would not find a sufficient majority. She was also not involved in the recent negotiations. In the USA there is no compulsory faction.