When I served in the U.S. House of Representatives, it was eye-opening for me to get an inside view of how the government works. I was naïve enough to believe that once away from the hurricane of political campaigns, members of Congress would work together to advance legislation they felt benefits the public and civil society. Yet, in practical ways, it never worked as it should. Partisan bickering got in the way of nearly every discussion. In the meantime, citizens impatiently waited for the nonsense to stop.
Now, a new president will attempt to navigate this storm. President Biden says he wants a bipartisan infrastructure bill and there is broad agreement among Republican and Democrat members of Congress for improvements. Recently, the president released information about his vision for a $2.2 trillion infrastructure plan. Although Biden says he wants the bill to be bipartisan, Democrat leaders in the Senate immediately asked the Senate parliamentarian for a ruling approving the use of budget reconciliation to allow the legislation to pass with only 51 votes. Most legislation in the Senate must have 60 votes to advance. This super majority requirement ensures the public of broad consensus on legislation.
The budget reconciliation procedure prohibits the use of a legislative filibuster by the minority party in the Senate. There has been a lot of talk over the years (and especially recently) about eliminating the filibuster. Budget reconciliation is a procedural move by the majority party to allow passage of legislation without any votes from the minority party. The procedure only is used when there is one-party control in government.
Democrats could have used the procedure to pass the Affordable Care Act, known as Obamacare, but at the time of passage, their caucus held 60 seats, a supermajority, and they were able to pass their bill under normal rules without a single Republican vote. But early this year, Democrats used reconciliation to pass the $1.9 trillion American Rescue Plan. It passed both chambers with zero GOP support.
Similarly, Republicans used it to pass the Tax Cut and Jobs Act signed into law by President Trump in late 2017. Since then, Republicans have attempted to use reconciliation to disassemble the Affordable Care Act and had numerous votes to repeal the entire law. Democrats will do the same to the tax law signed by President Trump. This constant back and forth between left and right is most commonly seen when the majority forces policy on the minority.
The partisan divide is close to a 50-50 split. This should be a warning sign to the majority party to be more judicious in decision-making, but in our hyper-partisan environment, I hold little hope for that. In times like these, when the American people are divided, the country deserves leaders who will be cautious regarding legislation. If the majority were to consider the minority party’s view, legislation would more likely be accepted by the citizens. Right now, nearly 50% of citizens will feel disregarded in what the majority does, and the cycle of disruption will likely start all over.
Senate Majority Leader Chuck Schumer (D-N.Y.) asked the Senate parliamentarian for a ruling to reuse the budget reconciliation process more than once per year and received a green light to proceed. So here is what you can expect: Republicans essentially will be left out of the legislative process and the president’s infrastructure plan likely will move forward in one form or another. There will certainly be bumps in the road (pardon the pun) as Democrats push to get their pet projects in the bill. And how does this affect us in the roofing industry?
On the positive side, there will be a healthy commitment to vertical construction. In the residential and commercial roofing space, billions of dollars of investment are coming our way. There are indications of strong support for career and technical educational training and an increase in resilient construction. That means more insulation, better attachment methods, and better wind- and impact-resistant roof assemblies. All these bode well for consumers and contractors.
On the negative side, there will be a major push for more unionization of labor. That is not necessarily bad unless it is forced upon workers who prefer to work in open-shop environments or owners who prefer to run them. It also discounts most of rural America where apprenticeship training is not readily available. The roofing and broader construction industries have faced a chronic shortage of workers. This will make the existing labor problem worse.
In addition, the sheer amount of investment in roads and bridges will create increased competition for labor, which may force a reexamination of the nation’s legal immigration process, an unexpected silver lining.
Finally, at $2.2 trillion, you can expect a visit from the tax collector because taxes most certainly are going up. Small-business owners will bear the brunt of this. Rather than adjusting user fees such as modifying the gas tax for the first time since 1993, the president campaigned on raising taxes on taxpayers earning more than $400,000 per year. He also is proposing an increase in corporate taxes. Put another way, the 2% of the population that currently carries the largest tax load will have to pony up again. But even these increases won’t cover a bill this large because there simply are not enough taxpayers in that group, so expect the national debt to continue to grow. At some point, we must recognize this level of spending is not sustainable.
I could go on about this legislation given how large it’s going to be. But Congress hasn’t even started writing it yet. This likely will take up the entire legislative agenda for the rest of 2021 even though Speaker Nancy Pelosi (D-Calif.) says she hopes the bill will pass by July 4. If it passes, it will be late in the year. Soon after that, the nation will enter its midterm election cycle and the people will decide whether they like what they see.
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