⚡ Punchbowl News Special Edition: Biden-Capito negotiations break down

BY JOHN BRESNAHAN, ANNA PALMER AND JAKE SHERMAN

Infrastructure negotiations between President Joe Biden and Sen. Shelley Moore Capito (R-W.Va.) have broken down, with both sides concluding they were too far apart to reach a deal, according to White House and Senate sources. 

Capito has been negotiating with Biden for weeks, but the two sides never got within striking distance of an agreement. Senate Republicans and the Biden administration disagreed on the fundamentals of how much to spend and how to pay for a large-scale public works bill. For example, Republicans did not want to raise taxes, and instead were hoping to offset the cost with unspent Covid relief money. The White House wanted a large-scale, $1-trillion package. The Biden administration griped that they moved toward the Republicans, but the GOP never reciprocated. Republicans said the White House wants to spend far too much money.

Focus will now shift to other bipartisan talks in the House and Senate. Biden is expected to now engage with groups of Republicans and Democrats — not only Republicans. However, Democratic leaders are preparing to move forward with a party line  reconciliation bill in July if there is no two-party agreement.