Hello and happy Thursday, and welcome back to On The Money. I’m Naomi Jagoda, filling in for Sylvan Lane, with your nightly guide to everything affecting your bills, bank account and bottom line.
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THE BIG DEAL: Biden to propose $6 trillion budget
President BidenJoe BidenPaul Ryan: Voters won’t be impressed by ‘yes-men and flatterers flocking to Mar-a-Lago’ Intelligence told White House they have unexamined evidence on coronavirus origins: report Milley says U.S. planning for potential evacuation of Afghan translators from region MORE is set to propose a budget totaling $6 trillion on Friday, The New York Times reported early Thursday, about a third higher than pre-pandemic spending levels.
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The proposal would contain major investments in infrastructure, education and health care, according to the Times, and bring federal spending levels to their highest sustained level since World War II.
Under the plan, documents for which were obtained by the Times, the federal government would spend $6 trillion in the 2022 fiscal year and spending would increase to $8.2 trillion by the year 2031.
The significance of the budget:
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- Budget documents are rarely passed in their exact form, but they reflect the administration’s priorities. This is Biden’s first budget proposal as president.
- The budget proposal indicates that the White House wants a bigger role for government in the U.S. economy.
Read more here and here about Biden’s forthcoming budget proposal.
LEADING THE DAY: Senate Republicans pitch $928 billion infrastructure offer
Senate Republicans on Thursday unveiled a $928 billion infrastructure proposal that includes $506 billion for roads, bridges and major projects and $98 billion for public transit systems.
The latest offer is substantially more than the $568 billion infrastructure framework the group led by Sen. Shelley Moore CapitoShelley Wellons Moore CapitoOvernight Energy: Biden admin backs Trump approval of major Alaska drilling project | Senate Republicans pitch 8 billion for infrastructure | EPA to revise Trump rule limiting state authority to block pipelines On the Money: Biden to propose trillion budget | Senate Republicans pitch 8 billion infrastructure offer | Biden faces dilemma on Trump steel tariffs McConnell: Republicans ‘open to spending more’ on infrastructure MORE (R-W.Va.) introduced in April, but it’s still far short of the $1.7 trillion counteroffer that White House officials came back with last week.
“Senate Republicans continue to negotiate in good faith,” Capito told reporters Thursday morning. “We’ve had a lot a good dialogue with the White House.”
“We’re trying to get to that common goal of reaching a bipartisan infrastructure agreement that we talked about in the Oval Office with the president several weeks ago and I talked with him even previous to that,” she added.
The Hill’s Alexander Bolton has more here on Republicans’ proposal.
White House reaction: The White House on Thursday welcomed the $928 billion Republican counteroffer on infrastructure as “constructive” and signaled bipartisan talks would continue into next week as President Biden pressed for swift action.
“At first review, we note several constructive additions to the group’s previous proposals, including on roads, bridges and rail,” White House press secretary Jen PsakiJen PsakiOvernight Energy: Biden admin backs Trump approval of major Alaska drilling project | Senate Republicans pitch 8 billion for infrastructure | EPA to revise Trump rule limiting state authority to block pipelines On the Money: Biden to propose trillion budget | Senate Republicans pitch 8 billion infrastructure offer | Biden faces dilemma on Trump steel tariffs Biden budget expands government’s role in economy MORE said in a statement Thursday.
“At the same time, we remain concerned that their plan still provides no substantial new funds for critical job-creating needs, such as fixing our veterans’ hospitals, building modern rail systems, repairing our transit systems, removing dangerous lead pipes, and powering America’s leadership in a job-creating clean energy economy, among other things,” she added.
The Hill’s Morgan Chalfant has more here on the White House’s thoughts.
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Biden faces dilemma on Trump steel tariffs
President Biden faces a dilemma on whether to lift tariffs on steel and aluminum imports imposed on the European Union by the Trump administration.
Biden wants to ease tensions with European allies and has faced pressure from the U.S. Chamber of Commerce and domestic industries that rely on metals to lift the tariffs.
However, the president risks angering steelworkers and other labor unions if he takes that step, particularly as the U.S. steel industry has boomed with the tariffs in place. That would give Republicans an opportunity to hit Democrats before the midterm elections in crucial swing states like Pennsylvania and Ohio where the steel industry is strong.
Read more here about the challenges Biden faces on tariffs.
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GOOD TO KNOW
- Weekly unemployment claims hit a new pandemic low in the third week of May of a seasonally adjusted 406,000.
- The Senate on Thursday advanced legislation aimed at combating China’s competitiveness after Senate Majority Leader Charles SchumerChuck SchumerSenate votes to advance China bill after Schumer strikes deal Pelosi: ‘Personally devastated’ by latest mass shooting in home state Schumer says Senate will move on Biden’s infrastructure agenda in July MORE (D-N.Y.) cut a deal, breaking an hours-long stalemate.
- The Senate Finance Committee late Wednesday deadlocked on legislation that would overhaul energy tax breaks. Democratic leaders have the authority to advance the legislation to the floor.
- Treasury Secretary Janet YellenJanet Louise YellenOn the Money: Biden to propose trillion budget | Senate Republicans pitch 8 billion infrastructure offer | Biden faces dilemma on Trump steel tariffs Yellen expects high inflation rates to be temporary Watch live: Yellen testifies before House panel MORE said Thursday that she expects the current higher inflation rates will last for another several months but will be temporary.
OPINION
- Biden’s got the right idea with the wrong funding for the IRS, by David F. Eisner and David J. Kautter, former Trump administration Treasury Department officials.
- The Biden White House has made 4 big economic mistakes in just 4 months, by Liz Peek, a former partner of major bracket Wall Street firm Wertheim & Company.