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The Senate passed the $1 trillion infrastructure plan on Tuesday after weeks of wrangling between Republicans and Democrats. This bipartisan plan will be one of the largest infrastructure investments seen in decades in the United States.
The vote ended 69-30, with 19 Republicans joining the 50 Democratic Party votes in favor of implementing the infrastructure plan. States will have the autonomy to allocate federal funds from this plan to projects that local governments deem a priority.
This outcome is the product of weeks of negotiation between the bipartisan team of 10 senators and the White House. The current legislation will authorize reinvestment in existing federal public infrastructure programs, as well as $550 billion for water and sewer projects, power grid renewal and maintenance of existing infrastructure.
For years, both Republicans and Democrats have expressed their intentions to implement a new infrastructure plan, however, differences in the focus of resources (Democrats favoring railroads and Republicans favoring highways) had prevented agreement.
Although Senate lawmakers reached an agreement on the infrastructure plan, the bill still has a long way to go. House Speaker Nancy Pelosi stated that the House would not vote on the infrastructure plan until the Senate passed the other $3.5 trillion plan to attack poverty and climate change.
What will the money in the infrastructure plan be used for?
Of the $550 billion earmarked in the infrastructure plan, $110 billion will go to building and renovating roads and bridges, $66 billion to railroads and $40 billion to fund new public transportation systems.
65 billion will go to broadband expansion in the U.S., which will include a 30 per month subsidy to fund Internet access for low-income families.
The bill also includes a budget to mitigate the consequences of climate change. 65 billion will be used to renew the electric grid and make it compatible with new generation sources. 50 billion will be used to make U.S. infrastructure more resilient to cyberattacks and the effects of climate change.
Nearly $7.5 billion will go to build electric and hybrid charging stations across the country. Another $7.5 billion will go to replace the aging fleet of school buses and ferries with lower-emission vehicles.
Republicans who oppose the bill argue that the costs of implementing the new infrastructure plan outweigh the benefits and that this plan truly does not make any substantial investments, nor does it prioritize any infrastructure.
Some economists suggest that the impact of the infrastructure plan, which will be implemented over the next 10 years, will be limited on short-term growth. However, the infrastructure investment made during the implementation of this plan will boost the country’s productivity.
One of the biggest points of difference between Democrats and Republicans is over how the money to fund the plan will be raised. The former largely favored the corporate tax increase, while those in the GOP openly oppose any tax increase.
In the end it was decided that funds for the infrastructure plan will be raised by redirecting money that has not yet been executed from previous stimulus plans to counteract the effects of the pandemic, as well as using Medicare reimbursements and money raised from broadband spectrum auctions in the United States.
The Congressional Budget Office also determined that the estimates for paying for the Infrastructure plan fell short and ultimately the bill that over the next decade could add as much as $256 billion to the nation’s deficit.
Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica