News Update: Momentous Infrastructure Bill Passes in the U.S. Senate

On August 10, 2021, President Biden stated: We’re on the cusp of an infrastructure decade that… will transform America”. He said that as a polarized Congress passed a momentous infrastructure bill to invest in the nation’s crumbling infrastructure.

The result is a $1 trillion dollar historic bill that promises to bringing infrastructure and supply chain to the forefront.

After months-long negotiations, Congress passed this bill against the odds and. The bill passed with all Democrats voting for it along with 19 Republicans. The final vote was 69 – 30 with one senator not voting. Hence we have a bipartisan bill that will now go to the House of Representatives for further action.

This bill, while a potentially pivotal achievement, must also pass in the House. And that is far from guaranteed. With that, this post will go over the next steps and the outlook for passage into law. It will also put this bill in perspective and wrap up with how this may shape the New Normal.

Next Steps. To begin with, the House of Representatives is on its summer break.

Representatives won’t return to the chamber until August 25, 2021. But, the Speaker, Nancy Pelosi has stated she will not take up the bill immediately.

Rather, she wants to lay the groundwork for a larger $3.5 trillion spending bill. That would address many of the “human” of ‘soft” infrastructure issues progressives want to include that the Senate bill omits.

The Senate bill addresses very little of the “soft” infrastructure investments. Instead, it focuses on traditional infrastructure investments. They include roads and bridges, transit, electrical grid and energy production.

Nonetheless, the Senate bill does include some investments to expand the Internet and clean energy. For example, it makes provision for investment in broadband. And it also addresses “Green” initiatives, such as charging stations for electric vehicles.

Specifically, Speaker Pelosi wants to set the framework for a Reconciliation Bill that skirts the Senate’s filibuster rule. That would open up the path to putting the bill on the floor for a vote.

Further, the Speaker wants to lock future spending down. Reconciliation would allow for funding of the “soft” infrastructure items. Those include items such as childcare, paid family leave, free community college, to name a few.

Democrats, however, can’t agree on how to proceed. Some want to get agreement on a Reconciliation Bill first, others want to address the Senate bill now. Expect delayed action on the infrastructure bill, until Democrats agree on the path ahead.

Outlook for Passage from Bill to Law.  The outlook of a fast, smooth and easy process to passage in the House is unlikely. It faces several obstacles to final passage, but in the end passage may prevail.

Besides making Reconciliation a condition before considering the Senate bill, other hurdles exist. One is the debt limit increase that’s required. Funding the final bill would require raising the existing debt limit. This a major hurdle.

Another hurdle revolves around how to fund the projected “socially-oriented investments. Republicans have made their opposition to unchecked task-and-spend well-known. Sen. Rick Scott, R-Fla., who supports infrastructure investments stated: “I believe we need to live within our means.” So, this, too, is a major hurdle.

Another issue is that the current bill leaves some spending decisions to the States. Progressives in Congress want to put restrictions in place to curtail that leeway. They prefer tight restrictions that would stop any dilution of spending on “soft” infrastructure items.

There are more hurdles, but these are the major ones. Regardless, pundits view infrastructure as an historically bipartisan issue, so they believe passage is achievable.

Putting this in Perspective.  Whether the final bill is $1trillion or $3.5 trillion, is unprecedented.  It’s the largest funding for infrastructure since the Eisenhower administration, which oversaw the investment in the nation’s interstate highway system.

It addresses hard-core, big ticket items aimed at boosting the nation’s supply chains. It sets the framework for the New Normal. It does that by addressing weaknesses and deficiencies the pandemic laid bare.

In that regard, this bill sets in motion a strategic effort to redress the gaps and shortcomings in the nation’s supply chains:

  • Dilapidated roads, bridges, and dams.
  • Inefficient transit systems.
  • An overburdened and vulnerable electrical grid.
  • The transition from unsustainable energy sources to clean energy.

All in all, the bill in its current form is a gamechanger. Richard Geddes, Cornell University’s Director of Program in Infrastructure Policy stated this bill is: “…  at least a once-in-a-generation bill.”

The major takeaway from all this activity signals supply chain’s role in the New Normal.

 

The Ascension of Supply Chain Management as a Strategic Asset

The passage of the infrastructure bill in the U.S. Senate demonstrates the ascent of supply chains as a strategic asset. Supply chains affect both the public and private sectors’ competitive advantage.

Yesterday, supply chain issues were relegated to industry trade journals and academia.

Today, you can find stories about supply chain in headline news daily. Resilience, agility, integration/seamlessness are the new watchwords. They’re in the daily news, as they dominate the transition to the New Normal.

The fact is politicians and businesspeople agree tomorrow’s supply chains need a robust supporting infrastructure.

As you’re well aware, getting to passage of this bill was not an easy task. It took many, long hours of negotiation. It took teamwork to find common ground among competing interests. And it took skillful leadership to stitch together this massive bill.

As an innovative 3PL, American Global Logistics can help you transition to the New Normal.

Like the 60 senators who succeeded in passing this gargantuan bill, we will work with you today to achieve long-lasting results.

We accomplish that with a commitment in time to your goals and objectives. And we will help you achieve your goals and objectives with teamwork and skillful leadership.

Contact American Global Logistics today to find out how we can help you keep pace with the future.