- Carlos Barria/Reuters
President Donald Trump is reeling after his first major legislative defeat, and he’s reportedly changing his plans to score some wins.
According to reports, Trump is making changes to two of his biggest economic-agenda items – tax reform and infrastructure spending – after the GOP’s attempt to reform healthcare failed on Friday.
After the Republican healthcare bill was pulled from a planned vote on the House floor Friday because of disagreements between moderate and conservative factions of the GOP, Trump is looking to find bipartisan efforts that can be achieved more simply.
Seeking a signature win, Trump is planning to move up the timetable on large-scale infrastructure spending to this year, reported Jonathan Swan at the news website Axios, citing a source in the White House.
Trump promised $1 trillion in infrastructure spending through public and private investment on America’s roads, bridges, airports, and more during his campaign, and he reiterated that desire soon after his inauguration. Reports had suggested, however, that Trump had decided to push that part of his agenda back to 2018.
Now, according to Axios, the need to establish a bipartisan win could shift forward the timetable for Trump’s infrastructure plan.
Doing so could give Trump a popular legislative victory, show he can work with Democrats, and possibly push economic growth closer to his stated goal of 4% annual gross-domestic-product growth (though Trump and his administration officials have talked that down toward 3% annual growth).
Additionally, Axios reported that the investment may come at the same time Trump and the GOP attempt to cut taxes. Both House Speaker Paul Ryan and Trump said tax cuts were the next issue they would tackle after pulling the healthcare bill from the House floor on Friday.
But the tax plan may not be as generous as originally thought.
During the campaign, a central part of Trump’s economic plan was to cut the federal statutory corporate tax rate to 15% from its current 35%.
This may have been adjusted a bit, according to Andrew Ross Sorkin at The New York Times, citing sources with knowledge of the plans.
Trump himself shifted the expectations when he told a group of manufacturing CEOs at a meeting in February that the rate would be cut to “15 to 20%.”
Now, Sorkin said, the plan for tax cuts is starting at a 20% corporate rate and could be even higher, possibly up to the 28% that was suggested by President Barack Obama in 2012 and 2013.
This would still be a cut and revenue-neutral, Sorkin wrote, but it is a far cry from the 15% continually promised by Trump and may make Wall Street rethink its forecasts for increased profits that would come as a result of lower tax bills.
But the smaller cut may be more palatable for Democrats and could provide some bipartisan cover to make sure the plan does not slip through the same cracks in the GOP conference that doomed the healthcare bill, the American Health Care Act.
As Trump attempts to regroup from the “Trumpcare” debacle and move forward with the passage of significant legislation, it appears his administration is willing to reconsider its policy goals and their timetables.