Where Did the “Only 10-15% of the Infrastructure Bill Went to Real Infrastructure” Canard Come From?
This week’s House Ways and Means Committee hearing on the economic impact of federal infrastructure funding featured several legislators criticizing the recent bipartisan infrastructure law (the Infrastructure Investment and Jobs Act, or IIJA) on the grounds that only “10 or 15 percent” of its funding went to “real” infrastructure. This complaint is not true, but to realize why it is not true, one needs to know where it came from.
The criticism has its origins back in May 2021, when President Biden released his long-awaited first budget request. The budget request had two parts. The changes that Biden wanted made to discretionary programs via the 12 annual appropriations bills had been sent up earlier, in broad strokes with lots of rounded numbers. But the real change was going to be in direct spending programs and tax law changes. In the regular budget, everything the Administration wanted to do in its first term was rolled up into two packages – an “American Jobs Plan” and an “American Families Plan” – that totaled $4.3 trillion in increased spending over ten years.
The budget then proposed for this $4.3 trillion to be largely offset by tax increases totaling $3.5 trillion over that same period, so that the net deficit increases attributable to the two plans totaled $799 billion, which the White House thought was an acceptable level that could be sold to Congress.
The infrastructure spending increases proposed by the President were part of the American Jobs Plan, as follows:
What President Biden Originally Proposed
|(New spending, above baseline)|
|10-Year Cost||Pct. Of||Pct. Of|
|Billion $$||AJP Gross||Total Gross|
|American Jobs Plan|
|Roads and bridges||112.3||4.3%||2.6%|
|Other transportation infrastructure (incl. EVs)||258.9||10.0%||6.0%|
|Safe drinking water||111.0||4.3%||2.6%|
|Upgrade federal buildings||27.3||1.1%||0.6%|
|Research and development||180.0||6.9%||4.1%|
|Medicaid home care providers||400.0||15.4%||9.2%|
|Clean energy tax incentives||342.3||13.2%||7.9%|
|Housing/infrastructure tax incentives||60.6||2.3%||1.4%|
|Subtotal, AJP (Gross)||2,598.9||100.0%||59.9%|
|Offsetting corporate tax increases||-2,070.0|
|American Jobs Plan (Net)||528.9|
|American Families Plan|
|Direct support to children/families||498.3||11.5%|
|Support workers, families, & econ. security||799.3||18.4%|
|Subtotal, AFP (Gross)||1,742.5||40.1%|
|Offsetting tax increases on high earners||-754.8|
|Offsetting increase in tax compliance/admin.||-717.6|
|American Families Plan (Net)||270.1|
|Total Biden Plans (Gross)||4,341.4||100.0%|
|Total Biden Plans (Net)||799.0|
One person’s definition of “real infrastructure” may differ from someone else’s. Increased road and bridge spending was, indeed, only 4.2 percent of the original AJP proposal, and if one includes the AJP and the AFP as one combined agenda, it was only 2.6 percent of the total. One can then add whether or not they consider airports, mass transit, Amtrak and other intercity railroads, broadband, etc to be real infrastructure or not, but it is possible to cobble together a list of traditional federal infrastructure roles, and if you add up the increased spending in the Biden budget on those roles, it could be between 10 and 15 percent of the combined Biden AJP + AFP agenda.
CONGRESS DID NOT PASS THE ENTIRE BIDEN AGENDA, NOR ARE THEY GOING TO DO SO.
Instead, the delays in Biden putting his plan forward allowed a bipartisan group of Senators led by Kyrsten Sinema (D-AZ) and Rob Portman (R-OH) to hijack the physical infrastructure parts of the plan, negotiate with the White House down to a level they thought was acceptable, then cut the House out of the process completely and put the bill on the Senate floor in late July 2021. In order to keep progressives from bolting en masse, House Speaker Nancy Pelosi (D-CA), along with President Biden, had to promise to treat the infrastructure-only bill as part of a larger deal, with the rest of the AJP and AFP agenda rolled together into one huge, amorphous budget reconciliation bill.
(Some of the AJP manufacturing revitalization and R&D provisions are moving separately in an economic competitiveness bill.)
The Senate passed the infrastructure bill by a large bipartisan vote on August 10, with 19 Republicans joining all 50 Democrats in support. But former President Trump, for whatever reason, attacked the bill, and some of his attacks cited the 10-15 percent talking point that had arguably been true three months earlier when discussing the entire Biden agenda but which was no longer true when discussing the infrastructure bill by itself.
Instead of putting the Senate-passed infrastructure bill on the House floor for a vote immediately, Speaker Pelosi kept it on the shelf, trying to force moderates to vote for as much of the rest of the Biden agenda as they could cram into a budget reconciliation bill. Unfortunately, this also allowed the GOP talking point to remain somewhat valid – if the Speaker was still saying that the infrastructure bill and the multi-trillion-dollar reconciliation bill were two inseparable parts of one larger package, who were Republicans to say differently?
Eventually, Pelosi had to give up on that strategy and put the infrastructure bill on the House floor anyway, where it passed by a 228 to 206 vote on November 5. By that point, House Republicans, egged on by Trump, had been bad-mouthing the combined infrastructure-reconciliation package every day for almost three months, so even when Pelosi agreed to separate them, it was too late for many of them to switch their position. Only 13 Republicans voted for the bill in the House. (The number would likely have been far higher if Pelosi had put the infrastructure bill on the House floor in mid-August, when it was riding its post-Senate momentum.)
Since then, it has become obvious that Senate Majority Leader Mitch McConnell (R-KY) was correct in his analysis – that separating physical infrastructure from the rest of the Biden plan and letting it pass solo would make it more difficult, not less difficult, for Democrats to pass the rest of the Biden fiscal agenda. Senator Joe Manchin (D-WV) made it clear just before Christmas that he would not be the 50th vote, and there has been absolutely zero work to revive the budget reconciliation bill since then.
And, since the rest of the Biden fiscal agenda appears dead for the fiscal 2022 budget cycle (with the manufacturing competitiveness bill alive but facing an uphill battle), it turns out that almost all House Republicans voted against an infrastructure bill that was heavily focused on traditional modes of infrastructure. In terms of new above-baseline outlays (so as to be consistent with the presentation of the Biden request above), the gross totals in the Infrastructure Investment and Jobs Act are around $538.5 billion over 10 years, before the “pay-fors” that offset part of that spending.
Of that gross spending total, roads and bridges get almost 25 percent. Amtrak and intercity rail capital programs get 9.3 percent, mass transit 8.3 percent, airports 4.5 percent. Looking beyond transportation, most Republicans concede that public water utilities are infrastructure, and they get about 11.6 percent of the spending (some of that is for lead pipe remediation). And, since the GOP is now a more rural party, they are more receptive to the idea that broadband internet is infrastructure, and the bill gives 11.5 percent of its money for that purpose.
All told, well over half of the above-baseline funding provided by the IIJA goes for traditional roles of infrastructure that the federal government has been providing to state and local governments for decades, and this rises to over 70 percent if you include broadband. Those who voted against the bill need to update their talking points, because it’s not May 2021 anymore.
What Has Actually Been Enacted
|(New spending (outlay estimates), above baseline)|
|Roads and bridges||134.0||24.9%|
|Water resources (Corps, BuRec)||14.8||2.7%|
|Clean drinking water/wastewater facilities||62.5||11.6%|
|Total Outlays Above Baseline (Gross), IIJA||538.5||100.0%|
(In terms of money that was actually provided by the IIJA, both under baseline and above baseline, you would have to convert outlay numbers to budget authority, but that would only be for 5 years and would not compare directly to the original Biden budget plan. But there was $293.5 billion in Highway Trust Fund contract authority in the baseline provided by the IIJA, and the outlays from that money are not included in the $134.0 billion and $43.4 billion outlay numbers in the table just above. So you could also argue that people who voted against the IIJA voted against that $293.5 billion in baseline funding as well.)