Trump Wants $1 Trillion for Infrastructure

Trump Wants $1 Trillion for Infrastructure

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Plus, voters don't want unemployment benefits cut
Wednesday, June 17, 2020

Trump Wants a $1 Trillion Infrastructure Plan. He’ll Have to Convince His Own Party.
Senate Republicans are pushing back against the Trump administration’s still-developing plans for a $1 trillion infrastructure package designed to boost the coronavirus-ravaged economy — and the president’s reelection chances.

A draft of the plan is being prepared by the Department of Transportation, Bloomberg reported, and it focuses on typical infrastructure projects such as road and bridge construction over a 10-year period, though it also includes money for rural broadband and updated wireless infrastructure.

Conservative lawmakers are already saying the plan will be a tough sell for the administration, at least in the Senate. "I think that’s a very heavy lift," Sen. Pat Toomey (R-PA), who sits on the Finance Committee, told The Hill.

The big problem. The objection to the plan is simple: it’s expensive, and the federal government is already spending trillions of deficit-funded dollars to address the coronavirus. "Nothing we’re doing right now is fiscally responsible," said Sen. Mike Enzi (R-WY). "I’m much more inclined to stick to solving the virus problem."

In April, Senate Majority Leader Mitch McConnell (R-KY) rejected the idea of including infrastructure projects in the coronavirus relief bills then under discussion. "Infrastructure is unrelated to the coronavirus pandemic that we’re all experiencing and trying to figure out how to go forward," he said at the time.

McConnell is reportedly more focused on the five-year reauthorization of the Highway Trust Fund, a Senate version of which is expected to cost $287 billion — a far smaller sum than the Trump infrastructure plan, but a problem nevertheless in an increasingly deficit-focused upper chamber. Senate Finance Committee Chairman Chuck Grassley (R-IA) said he is still looking for ways to pay for $93 billion of the highway bill.

Room to maneuver? Still, there are some Republicans who are open to an infrastructure package. Sen. Lisa Murkowski (R-AK) said she would like to work with the House, which is currently marking up a $500 billion package focused on surface transportation, to pass a bill that also addresses water infrastructure and new energy technologies. Senate Appropriations Committee Chairman Richard Shelby (R-AL) has also said he is interested in a major infrastructure bill, though he has not discussed any details with the administration.

Democrats, however, may be wary of working with a White House that has repeatedly talked up infrastructure spending but done little to see a plan through. As one Democrat told the Financial Times, "Infrastructure has been like Lucy pulling away the football from Charlie Brown. Every single time he thinks ‘this time it’s real.’"

Poll: Voters Don’t Want Unemployment Benefits Cut
With Congress likely heading for a fight over an extension of enhanced unemployment benefits, voters in a new poll overwhelmingly say they don’t want those payments to be cut.

The survey by Politico and Morning Consult found that four in 10 registered voters say the government should increase unemployment benefits to workers who lost their jobs due to the coronavirus pandemic. Another 35% said jobless benefits should stay the same. Just 13% said the payments should be cut.

The poll of 1,987 registered voters was conducted June 12-14 and has a margin of error of 2 percentage points.

Trump administration officials and leading Republican lawmakers have said that the current benefits, including a $600 weekly boost provided as part of emergency coronavirus relief legislation, is a problem since it creates a disincentive for workers to go back to their jobs. Democrats have proposed extending the $600 increase, set to expire at the end of July, by six months.

1.5 Million Public Sector Employees Have Been Laid Off or Furloughed
State and local governments have shed about 1.5 million jobs since March, bringing employment in the sector to its lowest level since 2001, according to a review of Labor Department data by the Pew Charitable Trusts. Most of the job losses have been furloughs or temporary layoffs, with public education accounting for about two-thirds of the reductions.

As the coronavirus pandemic hit the economy in March, local "governments issued hiring freezes, furloughed staff, or laid off seasonal employees," Pew says. "School districts made significant cuts to noninstructional hourly staff, such as bus drivers and maintenance workers. Most of the hits to school payrolls so far resulted from closures, but any future downsizing would be driven primarily by budget cuts in the wake of the recession ..."

While many state and local officials view the job cuts as temporary, much depends on how schools reopen in the fall — and how quickly tax revenues return to pre-pandemic levels. On Monday, the Center on Budget and Policy Priorities, a left-leaning think tank, released its latest estimates for state revenue losses, which indicate that state and local governments face enormous losses in revenue that could last for many months.

CBPP estimates that states alone will see a $615 billion shortfall in revenues across three fiscal years from 2020 to 2022 — a much larger loss than in the previous two recessions. The deepest shortfall will occur in the 2021 fiscal year, which begins on July 1 in many states.

"The projected shortfall for the upcoming fiscal year (2021) is much deeper than the shortfalls faced in any year of the Great Recession," CBPP said. "These figures underscore the continued urgency of the President and Congress enacting substantially more fiscal relief and maintaining it for as long as economic conditions warrant."

Fiscal Flashes

Court strikes down Trump rule requiring drug prices in TV ads: A federal appeals court ruled Tuesday that the Trump administration lacks the legal authority to force drugmakers to disclose their prices in television ads. The unanimous decision by a three-judge panel — the latest in a series of setbacks for the administration’s blueprint to lower prescription drug prices — "denies Trump an easy-to-understand win on a major reelection priority for the White House," Ricardo Alonso-Zaldivar of the Associated Press writes. (Associated Press)

Fed chief talks up fiscal support: Federal Reserve Chair Jerome Powell urged lawmakers Wednesday to move slowly and carefully as they considers winding down programs that are supporting individuals and businesses during the coronavirus pandemic. "I would think that it would be a concern if Congress were to pull back from the support that it’s providing too quickly," Powell told the House Financial Services Committee. "I do think it would be appropriate to think about continuing support for people who are newly out of work and for smaller businesses who are struggling," he added. "The economy is just now beginning to recover. It’s a critical phase and I think that support would be well-placed at this time." (Bloomberg)

SBA and Treasury reduce paperwork for PPP loan forgiveness: "The Small Business Administration and the Treasury Department released a three-page "EZ" loan forgiveness form that certain borrowers from the so-called Paycheck Protection Program would be able to use. The administration said it requires fewer calculations and less documentation than the full application. The initial version of the forgiveness form was 11 pages." (Politico)

It’s not just the virus keeping people from going to the doctor: "While hospitals and doctors across the country say many patients are still shunning their services out of fear of contagion — especially with new cases spiking — Americans who lost their jobs or have a significant drop in income during the pandemic are now citing costs as the overriding reason they do not seek the health care they need," The New York Times’s Reed Abelson reports. (New York Times)

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