Happy Friday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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A fond farewell: Today we say so long and best of luck to Niv Elis, our Baron of the Budget and Archduke of Appropriations, who just capped off his last day at The Hill. Niv has anchored our coverage of federal spending and deficits, trade and labor policy, and a wide range of economic issues and will be dearly missed as he becomes the Managing Director of External Communications for Jewish Federations of North America!
THE BIG DEAL—Centrists gain leverage over progressives in Senate infrastructure battle: Centrists have gained leverage in the Senate battle over an infrastructure package after 11 more senators backed a $974 billion infrastructure framework.
- Twenty-one senators in all are supporting the proposal, which is much smaller than what the White House and liberals prefer—11 Republicans, 9 Democrats and an independent who caucuses with Democrats.
- Liberals who were calling on fellow Democrats to “cut bait” only a few days ago now grudgingly acknowledge they will have to review the details of what the centrists will come up with before deciding their next move.
- And centrist Democrats are touting the support of their 11 Republican colleagues for the five-year spending plan, arguing it is a strong indication that it can pick up 60 votes and pass the Senate outside the budget reconciliation process.
“There’s a lot of momentum,” said Sen. Mark Warner (D-Va.), who helped craft the framework.
“In terms of Republican supporters, I think we’re way north of the 11 who are public and there are many more.” The Hill’s Alexander Bolton tells us how we got here.
The obstacles: Warner acknowledged there are still major differences between centrist and liberal Democrats over the size of a reconciliation package that progressives want to pass in conjunction with a smaller bipartisan infrastructure bill.
- Progressives have called moderates to promise to support a reconciliation package before they agree to vote for a scaled-down bipartisan infrastructure bill.
- And several are frustrated that the bipartisan package won’t raise taxes at all on corporations or high net-worth individuals, who have seen their wealth grow dramatically since the 2008-2009 recession.
Questions over how to pay for it are also an issue, especially with Democrats by and large ruling out a gas tax hike.
- The tax has long been seen as a regressive measure that hits the poor and middle class, as well as people in rural parts of the country, disproportionately.
- But it is also something that Democratic presidents have embraced over the years, from former President Carter, who in 1977 supported raising the tax by 5 cents a year for 10 years, to former President Clinton, who with Vice President Al Gore backed the last hike in 1993.
“When you have Jeff Bezos making as much money as he is, it is not fair for us to then raise the gas tax,” Rep. Pramila Jayapal (D-Wash.) told The Hill.
Jayapal, who chairs the Congressional Progressive Caucus, said the thinking around the issue has indeed evolved within the party.
“Over time, as we have become more and more aware of the different ways in which tax structures are regressive or progressive … it has crystallized for progressives … that this is not the way to go,” she said. The Hill’s Hanna Trudo explains why.
Read more: White House reiterates opposition to raising gas tax amid infrastructure debate
LEADING THE DAY
Inflation concerns spark new political fights for Biden: Biden administration officials are insisting that the recent inflation spike will be temporary, but political challenges are already emerging from the historically high price levels that have yet to show any signs of receding.
Inflationary speed bumps are hitting the economy as it recovers from the coronavirus pandemic, causing anxiety in the business community and prompting Republicans to reposition themselves as the fiscally responsible party heading into a debt ceiling fight.
The Hill’s Alex Gangitano and I break it down here.
ON TAP NEXT WEEK
Tuesday:
- The Senate Banking Committee holds a confirmation hearing on the nominations of Brian Eddie Nelson to be Treasury undersecretary for Terrorism and Financial Crimes, and Elizabeth Rosenberg to assistant secretary for Terrorist Financing at 10 a.m.
- Federal Reserve Chair Jerome Powell testifies about the Fed’s response to the COVID-19 pandemic before the Select Subcommittee on the Coronavirus Crisis at 2 p.m.
- A Senate Finance subcommittee holds a hearing on trade policy in the Asia-Pacific region at 2:30 p.m.
Wednesday:
- The House Financial Services Committee holds a markup of pending legislation at 10 a.m.
- Housing and Urban Development Secretary Marcia Fudge testifies before the House Budget Committee on the department’s fiscal 2022 budget request at 10 a.m.
- A House Health, Education, Labor and Pensions subcommittee holds a hearing on expanding access to the retirement savings system at 10:15 a.m.
- Treasury Secretary Janet Yellen testifies before a Senate Appropriations subcommittee on the department’s fiscal 2022 budget request at 2 p.m.
Thursday:
- The House Oversight Committee holds a hearing on the need for paid family leave at 10 a.m.
- The Senate Banking Committee holds a hearing on bipartisan bills to increase access to housing at 10 a.m.
GOOD TO KNOW
- Irish Finance Minister Paschal Donohoe said Friday that he thinks countries should work to reach a compromise on a global minimum corporate tax.
- James Bullard, the president of the Federal Reserve Bank of St. Louis, predicted during an interview with CNBC that the central bank would raise interest rates in late 2022 due to rising inflation
- Fifty-two percent of Americans said that they are in favor of blanket student loan forgiveness “for all borrowers,” according to a new Go Banking Rates poll released Thursday.
ODDS AND ENDS
- Chinese apps could face subpoenas and bans under President Biden’s new executive order to protect U.S. residents’ personal information, people familiar with the matter told Reuters.
- Carnival Cruise Line says customer and employee data may have been exposed in a data breach in March.