Leaders Drive Infrastructure Deal, Bypass Committee Chairmen

Ron Wyden’s latest quest on the Senate floor is to rewrite a lucrative tax provision in the Senate infrastructure deal aimed at cryptocurrency.

As chairman of the powerful tax-writing Senate Finance Committee, the Oregon Democrat would normally have been in charge of writing the language before it hit the floor. But his position of having to change a deal negotiated by a bipartisan group of rank-and-file senators is only one example of committee chairmen being out of the driver’s seat on key legislation.

The trend in recent years of Capitol Hill leaders consolidating their power over the writing and scheduling of significant legislation continued with the Senate bypassing the traditional committee route in delivering the package.

Senate Majority Leader Chuck Schumer (D-N.Y.) and Minority leader Mitch McConnell (R-Ky.) tapped favored lawmakers to lead critical negotiations on the shape and details of the $1.2 trillion package (H.R. 3684) rather than defer to the chairs of Environment and Public Works, Finance, and other committees who would have ordinarily overseen the drafting of the legislation.

The move reflects leaders’ increased assertion of control to expedite high-profile legislation in a polarized era where complicated measures risk being bogged down or buried in partisan disputes and legislative maneuvering.

“The only way to produce legislation in this kind of environment is from the top, with party leader coordination,” said Wendy Schiller, a Brown University political scientist in an interview. She said erosion of the authority of the committees has been going on for the past decade and affects not only when bills come to the floor but also their content.

Photographer: Stefani Reynolds/Bloomberg

A bipartisan group of senators speak during a July 28 news conference after reaching an agreement on infrastructure.

Schumer defended the process in which lawmakers worked behind closed doors for weeks and periodically reported to him on their progress.

“It isn’t easy to do major bills in the Senate, especially bipartisan ones, so I have tried to prod the negotiators along when they have needed it and given them the space when they have asked for it,” Schumer said on the Senate floor once the deal was reached.

Critics said this top-down approach means most lawmakers have little say in what goes into major legislation. In this case, that includes massive federal spending for a wide array of projects around the nation including highways, bridges, broadband, water pipes, mass transit, and the power grid.

“A real problem” for the bill is that only about 20 people negotiated it, Sen. John Cornyn (R-Texas) said in an interview. “It’s not a criticism of our negotiators, that’s just the fact that they’ve been talking for a long time about it and they’ve agreed among themselves, but they certainly don’t have my proxy or anybody else’s proxy for voting on something as important and significant as that.”

Circumventing committee participation shuts out lawmakers who’ve spent years developing expertise in certain areas, Rutgers University political scientist Ross Baker said in an interview.

“These things being hatched in leadership suites in the Capitol and by kind of pickup games with various gangs of senators is not regular order, it’s decidedly irregular,” Baker said.

“This is no longer a Congress of committees, it’s a Congress of hideaway offices,” he said. “While a regular legislative process is an open one, a leader-driven process is a secret one.”

Crypto Change

As an example of the importance of such expertise, Wyden(D-Ore.) has been working to change proposed cryptocurrency reporting requirements that traders and investors have criticized as overly broad.

The crypto provisions, a late addition to the bipartisan deal, are projected to raise $28 billion over a decade. Wyden told reporters Tuesday that when writing legislation for emerging technologies, like cryptocurrency, lawmakers can’t assume that “the rules of brick-and-mortar economics can just be exported to the tech sector.”

A bipartisan amendment filed Wednesday by Wyden and Sens. Pat Toomey (R-Pa.) and Cynthia Lummis (R-Wyo.) would impose IRS reporting rules on a narrower slice of the industry, leaving out people involved in mining, staking, and selling hardware or software.

Read More: Senators Float Targeted Crypto Measure for Infrastructure Bill

Photographer: Al Drago/Bloomberg

Senate Finance Committee Chairman Ron Wyden (D-Ore.) is seeking to revise a cryptocurrency tax provision included in the infrastructure bill crafted by a bipartisan group of senators.

Besides EPW and Finance committees, the Banking, Housing, and Urban Affairs, and Commerce, Science, and Transportation committees stood down while a group of some 20 Democrats and Republicans, led by Sens. Kyrsten Sinema (D-Ariz.) and Rob Portman (R-Ohio), negotiated everything from payfors to policy with the White House.

McConnell used a similar strategy when he developed several pandemic relief packages in the last Congress, including the $2.2 trillion CARES Act (Public Law 116-136) with a small group of lawmakers over the course of several days last year.

McConnell said he supports the current infrastructure bill and the process used to finalize it. “I’ve tried to support the bipartisan group in every way that we can,” he told reporters.

From Center Out

One of the leading negotiators, Sen. Joe Manchin (D-W.Va.), said the public doesn’t care about the process and is more interested in getting the roads fixed.

“When you have both leaders pushing for it on both sides of the aisle, this is something that is going to get across the finish line, and I really believe very strongly in it,” Manchin said on the Senate floor.

Portman said on the Senate floor the group had to work “from the center out” but did so with the strong encouragement of the White House every step of the way.

After the deal was struck, EPW Chairman Tom Carper (D-Del.), who served in the Senate alongside President Joe Biden, and ranking member Shelley Moore Capito(R-W.Va.) gave their blessing and said they’d shepherd the measure on the Senate floor. But Capito said their committee provided the “building blocks” for the deal by already approving water and highway infrastructure bills earlier this year.

“I’m glad the basis of this are the two bills that came out of the EPW Committee,” she said on the Senate floor.

Carper said he and Capito first met with the president soon after the inauguration to discuss infrastructure plans. He said Biden asked them to jumpstart the work on the surface transportation bill and water legislation. He said the panel went to work and unanimously approved a water bill that the Senate passed in April. The panel advanced a bill to reauthorize highway programs in late May, he said.

But work slowed over lack of agreement over how to pay for it and advancing mass transit provisions overseen by the Banking Committee. Capito, a close ally of McConnell, said she negotiated with Biden over different financing proposals for the bipartisan bill, but ultimately that effort stalled.

Carper said the group of centrists picked by leaders ultimately injected some “sanity and commonsense” into the process.

With assistance from Allyson Versprille

To contact the reporter on this story: Nancy Ognanovich in Washington at nognanov@bgov.com

To contact the editors responsible for this story: Bennett Roth at broth@bgov.com; Kyle Trygstad at ktrygstad@bgov.com