President Joe Biden told a bipartisan group of lawmakers on Monday that he's "prepared to compromise" on a $2.3 trillion infrastructure plan that has sparked GOP criticism for its steep price and ambitious scope.
That overhaul not only seeks to repair America's bridges, roads, and highways, but also focuses on building infrastructure that reverses the effects of climate change and redresses long-standing racial injustice — and it would pay for such measures largely with a hike on corporate taxes from 21% to 28%.
In an interview that aired Monday on Yahoo Finance Live, U.S. Sen. Susan Collins, a Republican from Maine, said that her fellow Republicans have "long supported a robust infrastructure package."
But Collins, who was interviewed along with her colleague from across the aisle, U.S. Sen. Jeanne Shaheen of New Hampshire, sees a "real issue with three major principles" of Biden's plan.
"One is scope, which goes way beyond traditional infrastructure. The second is the cost. The top line of $2.3 trillion on top of the spending for COVID is enormous," Collins said. "And the third is the pay-fors. So those are going to be issues which are going to take a lot of work to bring us together."
While repairing physical infrastructure is typically a bipartisan priority, the expansive nature of Biden's plan has attracted criticism from Republicans like Collins. The plan prioritizes improving so-called "human infrastructure," setting aside $100 billion for workforce development programs targeting underserved groups. It also asks Congress to eliminate a law allowing disabled workers to receive sub-minimum wages.
The expansive nature of Biden's plan also includes proposals to tackle climate change, such as a $174 billion investment in the electric vehicle market.
"I'm always for additional research to make our transportation structure more efficient and more climate friendly," Collins told Yahoo Finance on Monday. "But I gotta say, I don't think it makes sense to spend $174 billion on electric vehicles, which is more than roads, bridges, sea ports, airports, and waterways combined."
'How do we pay for this package?'
The $2.3 trillion plan would exceed the $1.9 trillion COVID relief bill, which addressed Americans' more immediate needs by extending expanded unemployment benefits and mailing out stimulus checks. The president's plan to pay for the overhaul with a corporate tax hike has drawn some criticism, and on Monday the Wall Street Journal reported that Biden and some lawmakers had floated the notion of a smaller increase on the taxes of corporations.
A group of moderate Republicans revealed their own proposal last week to overhaul the nation's infrastructure, which the Washington Post reported would cost between $600 billion and $800 billion.
For her part, Shaheen, the Democratic senator from New Hampshire, told Yahoo Finance that she'd like lawmakers from both sides of the aisle to continue working together on an infrastructure overhaul.
"It is an opportunity for us to talk to each other. And one of the challenges is, how do we pay for this package?" Shaheen acknowledged. "But there are a whole range of things that have been discussed, not just this year, but over several past Congresses."
The New Hampshire senator suggested the funds could come from a number of sources, pointing out that the IRS Commissioner recently said $1 trillion in taxes goes uncollected each year. She also pointed out that the gas tax — which pays for infrastructure projects — isn't capturing all the vehicles on the road since it doesn't apply to electric vehicles.
"So those are all the things that I'm sure are going to get discussed in the coming weeks," Shaheen said. "And hopefully we can come to some agreement on, if not the whole package, on certain aspects of the package that we can support. And let's start with that."
Erin Fuchs is deputy managing editor at Yahoo Finance.