McConnell: ‘Zero’ GOP Support for Biden’s Big Plans

By Yuval Rosenberg

McConnell Says There’s ‘Zero’ Republican
Support for Biden’s Big Plans

As President Joe Biden works to sell his $4.1 trillion
plans for infrastructure and safety-net programs — and the tax
hikes on corporations and the wealthy that he proposes to help pay
for them — Republicans are looking to set the terms for upcoming
negotiations.

Senate Minority Leader Mitch McConnell (R-KY) said Monday
that Biden isn’t likely to get any Republican support for his
current spending proposals.

“I think it's worth talking about but I don't think there
will be any Republican support — none, zero — for the $4.1 trillion
grab bag that has infrastructure in it but a whole lot of other
stuff,” McConnell
said at a press conference at the University of
Louisville.

Senate Republicans have proposed a $568 billion
infrastructure package that Democrats have criticized as providing
too little new money. McConnell reportedly said that the GOP
proposal
isn’t a hard cap, but emphasized that his party
wants to limit the scope of the package.

"We're open to doing a roughly $600 billion package which
deals with what all of us agree is infrastructure," McConnell said.
"If it's going to be about infrastructure, let's make it about
infrastructure."

What’s next: White House Chief of
Staff Ron Klain said Sunday that Biden would invite several
Republicans to the White House this week for talks.

“The White House wants to see counteroffers to Biden's
$2.25 trillion infrastructure plan by the middle of this month, and
if progress isn't being made by Memorial Day, officials will
reassess their strategy of trying to build bipartisan support,”
Sahil Kapur and Shannon Pettypiece of NBC News
report, citing a person familiar with the
negotiations.

The two sides are approaching the negotiations warily,
with each worried that the other side isn’t bargaining in good
faith.

"Let's decide what are they prepared to consider in terms
of what constitutes infrastructure, how much of it, and then we can
talk about how to pay for it if we get to the point that we
actually have a real number," Biden told reporters last week after
a phone call with Sen. Shelley Moore Capito (R-WV), who is heading
the GOP’s infrastructure efforts. "If it's like last time — and I
don't, I think she's serious — but if, like last time, they come in
with one-fourth or one-fifth of what I'm asking and say, 'That's a
final offer,' then it's a no-go for me."

The fight over corporate taxes: How to
pay for infrastructure spending has always been a sticking point,
and the two sides still face fundamental disagreements over the
idea of tax increases.

Rep. Kevin Brady (R-TX), the top Republican on the House
Ways and Means Committee and a leading architect of the 2017 tax
cuts that Biden wants to largely reverse, predicted in an interview
with
CNBC Monday that “there’s going to be a real fight
over these tax increases.”

Brady said that there was room for compromise on
infrastructure but suggested that lawmakers should fund any package
by first seeking to eliminate waste and fraud from federal tax
credit programs and rededicating tax provisions that he said used
to fund infrastructure but have suffered what he called “mission
creep.” Brady also said the private sector should play a larger
role. "U.S. lags the rest of the world in attracting private
capital into infrastructure for some reason. That is an area that
Congress needs to get serious about because private capital rather
than tax dollars can help us fund basic infrastructure," he
said.

On the Democratic side, Senate Finance Committee Chair Ron
Wyden (D-OR) said he wanted to find common ground but that the
Republican position that multinational corporations “should not pay
a penny for infrastructure" made it harder to do so. "Pretty hard
to make anything bipartisan out of that," he said.

Biden on Monday defended his call for higher corporate
taxes. “I come from the corporate capital of the world,” he
said. “More corporations are incorporated in the state of Delaware
than all the rest of the nation combined. And I’m not
anti-corporate, but it’s about time they start paying their fair
share."

The president also sought to make the case for his plans
to raise taxes on the rich. “Do we want to give the wealthiest
people in America another tax cut? Or do you want to give every
high school graduate the ability to earn a community college
degree?” Biden asked. “Is it more important to keep these tax
loopholes for millionaires — for good people, not bad folks — or
would we rather put $7,200 in the pockets of working moms and dads
every year if they have two children?"

The bottom line: Infrastructure has
long been described as one policy area where there’s room for
bipartisan cooperation. We may find out this month whether there’s
any truth to that.

Yellen Makes the Case for Tax Hikes on the
Rich

Treasury Secretary Janet Yellen on Sunday defended President Joe
Biden’s plan to raise taxes on corporations and the richest 1% of
Americans, telling
CNN that the benefits of increased spending on
education and infrastructure outweigh any negative effects that
could be produced by the tax hikes.

“The greatest threat to our economic recovery – and our
long-term economic prospects – is not a marginally higher tax rate
for large corporations or the top 1% of taxpayers,” Yellen said.
“It's a lack of support for America's workers and families.”

Yellen explained that the Biden administration sees taxing and
spending as inseparably connected and argued that the combination
of policies it was promoting would produce a clear benefit in the
form of stronger economic growth.

“Asking 'will these tax increases hurt the economy?' is not the
right question,” Yellen said. “The right question is: 'Is trading
higher taxes on high-income taxpayers for middle-class tax cuts and
major economic investments pro-growth?' And the answer to that
question is a resounding yes.”

Republicans stick to their guns: GOP opposition to
Biden’s plan portrays the proposed tax increases as something close
to an economic disaster. In the Republican response to Biden’s
address to Congress last week, Sen. Tim Scott of South Carolina
charged that Biden was planning “the biggest job-killing tax hikes
in a generation.”

Big business tends to agree. As CNN’s John Harwood reports, 98%
of CEOs surveyed by the Business Roundtable said the proposed tax
hikes would hurt their firms’ competitiveness, and substantial
majorities said the increases would result in reduced hiring and
R&D.

Given the Republican insistence on the power of tax cuts to
produce economic growth, and its supply-side approach more broadly,
this opposition to Biden’s plan comes as no surprise. The problem,
Harwood says, is that both the historical data and economic
modeling don’t show much support for GOP claims.

The Republican “attacks sound familiar because they echo jibes
against tax hikes enacted by the last two Democratic presidents,”
Harwood says. “As it happened, Bill Clinton oversaw an economic
boom and Barack Obama the longest streak of private sector job
growth in American history.”

Estimating the effects: Analyses by right-leaning think
tanks show negative economic effects from Biden’s proposed tax
increases, but the effects are relatively small. The Tax Foundation
estimates that Biden’s plan would result in an economy that is
1.62% smaller in 2050, but Republican economist Doug Holtz-Eakin
says it would be just 0.2% smaller, once the growth produced by the
associated spending is taken into account.

The American Enterprise Institute found an even smaller effect,
estimating that the economy would be 0.16% smaller. "I would not
say it is a job-killing disaster," AEI's Kyle Pomerleau told
CNN.

Other think tanks have produced more positive results. The
Penn-Wharton Budget Model found that Biden’s tax increases would
slightly reduce the economy by 2030, relative to the baseline, but
then increase it by 2050. Economist Mark Zandi of Moody's found
similar results, with the tax producing a short-term drag but then
higher growth as the spending kicks in.

Challenging the tax cut faith: While Republicans are
sticking with the economic ideology they have embraced for four
decades, the Biden administration is trying to revive the idea that
taxes can help pay for social investments that eventually produce
higher growth.

Washington Post columnist Jennifer Rubin
argues Monday that the problem for the GOP is that
its faith in its fiscal policies is drifting ever further away from
the facts on the ground. “Republicans simply ignore the mountain of
evidence disproving the benefits of supply-side tax cuts,” Rubin
writes, adding that decades of research suggests that tax policies
have little effect on growth and employment.

Yellen argues that the Biden plan marks a turning point in
Washington’s approach to taxing and spending. “Since the Reagan
years, we've been enduring a particularly potent economic ideology
in this country -- one that says tax cuts, as a rule, promote
growth while government investment, as a rule, is wasteful,” she
told CNN. “This ideology has never made much sense given what we
know about the payoffs from government investments in people,
infrastructure and R&D.”

Why the US May Never Achieve 'Herd
Immunity'

Nearly 45% of Americans have received at least one dose of
Covid-19 vaccine and nearly a third are fully vaccinated, according
to the Centers
for Disease Control and Prevention. As the vaccination
total has grown, new infection rates have fallen, with the
seven-day average of new cases dropping below 50,000 this weekend
for the first time since October.

But as the vaccination rate slows — it averaged
2.4 million a day over the past week, down from
3.4 million a day as of April 13 — many of those left unvaccinated
either have difficulty accessing the shots or are
hesitant to receive them.

Those challenges and others now have scientists and public
experts saying that the United States isn’t likely to reach

“herd immunity,” the point at which enough of the
population is immune to the virus that its spread becomes less
likely and even the unvaccinated have some protection. Apoorva
Mandavilli of The New York Times
reports:

“[T]here is widespread consensus among scientists and
public health experts that the herd immunity threshold is not
attainable — at least not in the foreseeable future, and perhaps
not ever.
“Instead, they are coming to the conclusion that rather
than making a long-promised exit, the virus will most likely become
a manageable threat that will continue to circulate in the United
States for years to come, still causing hospitalizations and deaths
but in much smaller numbers. …
“If the herd immunity threshold is not attainable, what
matters most is the rate of hospitalizations and deaths after
pandemic restrictions are relaxed, experts believe. …
“Over the long term — a generation or two — the goal is
to transition the new coronavirus to become more like its cousins
that cause common colds. That would mean the first infection is
early in childhood, and subsequent infections are mild because of
partial protection, even if immunity wanes.”


Read more at The New York Times.

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