President Donald Trump plans to announce a $1tn infrastructure bill in an effort to push Congress to spend more on roads and bridges, as the US economy continues to reel from the impact of the coronavirus pandemic.
Three sources familiar with the plan said Mr Trump would propose spending $1tn over a 10-year period. The White House is expected to release the plan in the coming weeks, as Democrats and Republicans debate the annual spending levels for a wide range of infrastructure.
One senior official cautioned that the plan was still “fluid and could take time”. He said there would be some overlap with the infrastructure bills lawmakers are debating on Capitol Hill as part of their annual budget process, but that Mr Trump wanted a much more ambitious package.
Mr Trump has often touted the need for more infrastructure spending, but has struggled to work with Congress. He abandoned talks with Democrats over a $2tn infrastructure bill last year because he was angry that they were pursuing investigations that led to his impeachment in the House of Representatives.
Democrats and Republicans agree that the US needs to spend more money to repair its dilapidated roads, bridges and other infrastructure. But there have been big disagreements over how to pay for it.
Mr Trump has in the past signalled a willingness to support a rise in the petrol tax, but Republicans have largely been opposed. Passing significant legislation is also much more difficult in a presidential election year.
Mr Trump will need support from Democrats since they control the House. But underscoring the nascent nature of his proposal, Democrats, including Nancy Pelosi, House speaker, have not been briefed on the plan, according to several congressional aides.
One Democrat cautioned that Mr Trump had frequently talked about doing something big on infrastructure.
“Infrastructure has been like Lucy pulling away the football from Charlie Brown. Every single time he thinks ‘this time it’s real’,” he said, referring to a common joke in the Peanuts comic strip.
The House committee on transportation and infrastructure will this week consider the “Invest in America Act”. The Democratic-led bill would authorise nearly $500bn in spending on highways and roads over five years, a 46 per cent increase from current levels. It includes more money for roads, bridges and transport systems, including Amtrak, the rail service.
Rodney Slater, who served as secretary of transportation in the Clinton administration, said the markets’ positive reaction reflected optimism that the administration and Congress might be able to find common ground.
Mr Slater said the Democratic plan for $500bn over five years was not so far from the administration proposal to spend $1tn over a decade. He added that while there would be a debate about how to fund the spending, the economic shock sparked by Covid-19 could spur lawmakers to action.
“The stars may be aligning where political considerations will take somewhat of a back seat to the challenge of the moment,” said Mr Slater, a partner at Squire Patton Boggs.
Democrats and Republicans are currently far apart in terms of bridging differences as they consider a fourth stimulus rescue package.
The “Invest in America Act” is part of a wider framework set out by Democrats in January to expand infrastructure spending. Since then, Ms Pelosi has made repeated calls for more infrastructure investment in an effort to boost jobs to help the country recover from the pandemic’s economic fallout.
But Mick Mulvaney, a former chief of staff to Mr Trump, said infrastructure spending was not the best way to provide a quick economic stimulus.
“Infrastructure’s a really, really difficult tool to use as stimulus because it simply takes too long to get the money into the system,” he told Fox News.