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GOP Sen. Capito on funding infrastructure, raising debt ceiling and increasing taxes

A bipartisan group of senators is still negotiating the details of an infrastructure bill after a procedural vote to debate it failed yesterday. The biggest issue remains how to fund the $1.2 trillion framework, including the $600 billion in new spending. Judy Woodruff speaks with Republican Sen. Shelley Moore Capito of West Virginia, who led a separate bipartisan effort on infrastructure in June.

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  • Judy Woodruff:

    A bipartisan group of senators is still negotiating the details of an infrastructure bill, after a procedural vote to start debate failed yesterday. They say they're making progress and hope to have the details by early next week.

    The biggest sticking point in negotiations remains how to pay for it. The $1.2 trillion framework includes about $600 billion in new spending. That money would go towards public projects, like shoring up roads and bridges, expanding broadband, and investing in electric vehicles. Democrats are also planning a separate $3.5 trillion spending bill.

    For more on where infrastructure stands, I'm joined by Republican Senator Shelley Moore Capito of West Virginia. She led a separate bipartisan effort on infrastructure last month.

    And, Senator, welcome back to the "NewsHour." We appreciate your joining us.

    So, we know you're not part of this group that is negotiating the current plan, but is it your sense that there will be an agreement in coming days that both parties can sign on to?

  • Sen. Shelley Moore Capito, R-WV:

    You know, I think that the efforts of the bipartisan group has put forward has been very straightforward and very honest, very narrow in terms of a physical infrastructure, much like the package that I was negotiating, with more dollars into it.

    I do expect that, early next week, hopefully as soon as Monday, that they will have actual bill text, so we would know what we would be voting on. It may take a couple of days to work the through the system, and maybe even another week.

    But I do think they are going to be able to lay the last issues to rest and bring forward a bill. And then we can make the judgments on it when we see it.

  • Judy Woodruff:

    And, of course, we will be watching very closely for that.

    But this has been, as you suggest, in the works for weeks and weeks, even months. It is taking a long time. Much of the hangup has been over how to pay for it.

    Democrats say that Republicans have repeatedly said no to ideas like putting more money into the IRS to go after tax cheats. And what's reported right now is that Republicans are looking at something called rolling pharmaceutical rebates.

    But we know this will only pay for a fraction of the costs. So where would the money come from?

  • Sen. Shelley Moore Capito:

    Well, we have to look it.

    Certainly, the base of what goes forward paying any kind of infrastructure is the gas tax. But we know that falls short of meeting the demands of where we are. So, I think this group has worked — as I did, has worked with the White House to get the White House to rebrand some COVID dollars, a lot of COVID dollars that are not — that are either going unspent or found that they really, since we're coming out of this pandemic, are not going to be able to use in the right times.

    That may — it sounds like a little, but it's really hundreds of billions of dollars. We did not want to — we, as Republicans, did not want to touch the 2017 tax cuts, because we think they have been very successful in spurring the economy. The president himself did not want to ask users of electric vehicles to pay into any kind of user fee.

    They use the roads. They don't pay. So we had a bit of a disconnect there. I think both sides are trying to get to reasonable pay-fors. But I expect, in the end, it's going to be tough to meet all the challenges of the pay-for. I guess the question will be, is enough of it paid for, and will the economic growth take care of the shortfall? And people are going to have to answer that for themselves.

  • Judy Woodruff:

    Why have Republicans mainly opposed the idea of giving the IRS more money to go after tax cheats?

  • Sen. Shelley Moore Capito:

    Yes, that's a good question.

    I think because the overhang of some IRS issues that we had with the IRS targeting conservative groups. I think we saw tax — tax returns from the wealthiest individuals just all the sudden public information. Where did that come from? That has to be some sort of leak.

    So I think these things feed on each other and the trust of the IRS coming knocking at your door. The other thing is the parameters of which the Democrats set forward in terms of getting to, the president told me, $700 billion. I don't — I think he came off that figure but would be that banks would share records, would be that your accountant would share records.

    Are you — are we getting into a fine line of where we need to really invasion of privacy and privacy of financial records? These issues, I think, are very sensitive to us as Republicans. And I think, in the end, the group knew that we wouldn't — to the amounts that they wanted, we couldn't go with the tax gap.

    So I expect that to be in their larger bill, in their $3.5 trillion larger bill.

  • Judy Woodruff:

    Senator, you have expressed concern also about this infrastructure legislation being tied to the separate $3.5 trillion so-called reconciliation bill…

  • Sen. Shelley Moore Capito:

    Right.

  • Judy Woodruff:

    … what the Democrats are calling social infrastructure.

    But it is being described — Democrats are saying this is the most consequential piece of legislation for working families in modern American history. They talk about the money in there for home health care workers, for pre-K, for child care, for the poor, elderly.

    Why are these things not worth spending money on?

  • Sen. Shelley Moore Capito:

    Well, we do now spend money on these things.

    I think — I think these are discussions that we need to work through our committees. Do we need to increase — I believe home health care is something, after having my parents go through this, I realize the tremendous cost to families. These are issues that we need to work on together. We don't need to ram through.

    What I disagree with on where the Democrats are going, they have set an amount. They have said, OK, we're going to spend $3.5 trillion. And then they're filling up the buckets. Shouldn't we be looking at the needs, and then look at what the cost is?

    And so I think, if we're going to make consequential, huge social reform all across this country, we should be doing that together. And it won't be that. It will be singularly done. This was a huge tax increase on the American public. And it's also a lot of reckless spending going along with it.

  • Judy Woodruff:

    But when you say there's already money, that the country — I mean, sorry — that the government is already spending money on these things like home health care, I mean, we hear from Democrats, that's just not the case, that much, much more needs to be done.

  • Sen. Shelley Moore Capito:

    Yes, I'm not saying that we're spending as much as we need to or we're — that we're meeting the need. That's what I'm saying. Let's define the need.

    How much more do we need to spend? What will keep a senior in their home longer to be able to have home health care and not make a greater cost to Medicaid or to the family? These are the kinds of discussions we need to have.

  • Judy Woodruff:

    Different subject, quickly, Senator.

  • Sen. Shelley Moore Capito:

    Yes.

  • Judy Woodruff:

    And that is the federal government debt ceiling, the amount of money the government has to pay for its bills, to keep running it.

    This has typically been not a popular thing, but a necessary and a routine thing in order to keep the government open. However, the Senate minority leader, Mitch McConnell, is saying right now that all Republicans will vote against raising it.

    We know you voted for it — we looked it up — three times under President Trump. Why would now be different?

  • Sen. Shelley Moore Capito:

    Well, I think — I will tell you what. The debt ceiling vote is always a difficult vote.

    And it always has some source of controversy through the years. And I'm sure you know that, having covered it probably dozens of times. And I think what we need to look at is, we have spent $1.9 trillion on a rescue package that we now see our communities flooded with money, and some of the money cannot be unspent, for instance, in the unemployment area, because governors have pulled back on that.

    I think we see now a $1.2 trillion infrastructure package coming down the road. We now see a $3.5 trillion package coming down the road after that. I mean, I think, at some point, we have got to look at what impacts this is having on our whole finances in this country.

    The debt ceiling, in all likelihood, will be raised. It has every time in the past. We're not going to default on our responsibilities. But I think we need to look at the spending and find out, who's it costing individuals and what's this do to future generations? That's the discussion we need to have.

  • Judy Woodruff:

    Does it matter to you that the chief economist at Moody's, Mark Zandi, is saying that passing these two infrastructure bills, both social infrastructure and the other one, are going to boost the economy and reduce all the concerns about inflation, in other words, that the concern that there's too much spending is overdone?

  • Sen. Shelley Moore Capito:

    Well, I think — I have been here for 20 years. We used to talk in billions. It's now trillions.

    Remember, in 2010, when President Obama came forward with a trillion-dollar package, and we all about fell over. We're now up to almost $10 trillion. So, I mean, I think every economist has a different opinion. I have great respect for Mark Zandi. And it — but I think you could find an economist who thinks differently, who thinks too much money is being flooded into the system.

  • Judy Woodruff:

    Senator Shelley Moore Capito, we appreciate it. Thank you.

  • Sen. Shelley Moore Capito:

    All right, thanks, Judy.

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