Overnight Finance: Republicans warn Biden over infrastructure deal | White House pushes back on criticism | Biden phones Sinema | Consumer spending flat in May, personal incomes drop
Happy Friday and welcome back to On The Money, where we’re hoping to eclipse Conan eventually. We’re Sylvan Lane and Naomi Jagoda, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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THE BIG DEAL — GOP senators warn they could pull support for Biden deal: Republican senators are warning that they could drop their support for a bipartisan infrastructure framework amid growing GOP fury over President Biden’s plan to link it to a Democratic-only bill.
GOP Sens. Jerry Moran (Kan.) and Lindsey Graham (S.C.) both signaled on Friday that their support, and eventual vote, for the bipartisan infrastructure deal — announced at the White House just yesterday — is tenuous if Democrats insist it has to move in tandem with a larger Democratic-only infrastructure plan.
The comments from the senators underscore how rocky the footing is for the bipartisan infrastructure package just a day after the core group of 10 Senate negotiators and Biden announced that they had reached an agreement.
Moran and Graham were not part of the group at the White House, but they were part of a larger group of 21 senators who have thrown their support behind the framework. If they drop their support, that would knock the number of Republican senators supporting the framework down from 11 to nine, below the 10 Republicans needed in addition to every Democrat to defeat a 60-vote legislative filibuster.
The Hill’s Jordain Carney has more here on the growing complaints from Republicans.
Additionally, The Hill’s Alexander Bolton took a look at some of the GOP concerns about the substance of the bipartisan infrastructure framework, including the proposal to give the IRS more money for enforcement.
White House pushes back on GOP criticism: The White House is pushing back on complaints from Republicans over Democrats’ plans to simultaneously pursue a bipartisan infrastructure package and one that can pass via reconciliation without GOP support.
“I think the American people are quite focused on how we’re getting work done on their behalf, less focused on the mechanics of the process. Now it is up to Republicans … to decide if they are going to vote against a historic investment in infrastructure that’s going to rebuild roads and railways and bridges in their communities, simply because they don’t like the mechanics of the process,” press secretary Jen Psaki told reporters on Friday.
“That’s a pretty absurd argument for them to make. Good luck on the political front on that argument,” she added.
The Hill’s Alex Gangitano has more here on Psaki’s comments.
Biden talks to Sinema on infrastructure: President Biden on Friday spoke with Sen. Kyrsten SinemaKyrsten SinemaOvernight Finance: Republicans warn Biden over infrastructure deal | White House pushes back on criticism | Biden phones Sinema | Consumer spending flat in May, personal incomes drop GOP senators warn they could pull support for Biden deal McCarthy pans deal: Biden gave GOP ‘whiplash’ MORE (D-Ariz.) to reiterate his support for a two-track path for a bipartisan infrastructure deal she helped broker alongside a reconciliation bill with Democratic priorities, even as his support for that strategy has led to some criticism on Capitol Hill.
Biden “reiterated his strong support for the compromise agreement, and they discussed his plan to try to build support for the Agreement among both Democrats and Republicans,” according to a White House readout. But the president made clear he would seek to move the bipartisan deal forward simultaneously with a budget resolution that is likely to only garner Democratic support.
“These are two critical priorities to the President that he wants to see advance through the legislative process as quickly as possible, pass as quickly as possible, and be presented to him for signing as quickly as possible,” the White House said. “The President looks forward to signing both these bills.”
The Hill’s Brett Samuels has more here about the significance of Biden’s outreach to Sinema.
LEADING THE DAY
Personal incomes drop, consumer spending stays flat in May: Personal incomes dropped and consumer spending stayed flat on net in May but remained well above pre-pandemic levels, according to data released Friday by the Commerce Department.
Income to households fell by 2 percent in May as the number of stimulus checks authorized by the March COVID-19 relief bill continued to dwindle and more Americans ran out of pandemic unemployment aid.
Consumer spending as measured by personal consumption expenditures (PCE) stayed flat on net, as a $71.5 billion decrease in spending for goods negated a $74.3 billion increase in spending on services, the Commerce Department said.
Spending on recreation, restaurants and bars, and accommodations led consumer expenditures in May, countered by a sharp decline in spending on motor vehicles and parts.
“The great consumer spending rotation gathered steam in May as households shunned now-expensive goods in favor of once-familiar services,” said Lydia Boussour of Oxford Economics in a Friday analysis. Sylvan has more here.
Inflation rising: The PCE price index — the Federal Reserve’s preferred gauge of inflation — rose 3.9 percent from a year ago and 3.4 percent minus volatile food and energy prices. While Fed officials and many economists expect inflation to settle down before the end of the year, the dynamic still poses considerable challenges for both the central bank and President BidenJoe BidenSenate Republicans urge CDC to lift public transportation mask mandate AOC said she doubts Biden’s win would have been certified if GOP controlled the House Overnight Defense: Intel releases highly anticipated UFO report | Biden meets with Afghan president | Conservatives lash out at Milley MORE.
“Consumers are shifting their focus from spending on goods to services, but the underlying trend for consumer spending remains red-hot. The result is showing up in prices,” wrote Diane Swonk, chief economist at Grant Thornton, in a Friday analysis.
ON TAP NEXT WEEK
The House Financial Services Committee holds a hearing on overhauling the credit reporting system at 10 a.m.
The House Small Business Committee holds a hearing on legislative proposals from panel members at 10 a.m.
A House Financial Services subcommittee holds a hearing entitled “The Legacy of George Floyd: An Examination of Financial Services Industry Commitments to Economic and Racial Justice” at 3 p.m.
A House Financial Services subcommittee holds a hearing on the retirement savings implications of the cryptocurrency boom at 10 a.m.
A House Small Business subcommittee holds a hearing on filling the entrepreneurship gap at 10 a.m.
A House Financial Services subcommittee holds a hearing on building resilience within the financial system to climate-related risks at 2 p.m.
GOOD TO KNOW
The Department of Education has failed to get back more than $1 billion owed from nearly 1,300 colleges, according to a new report from an education advocacy group.
The Supreme Court on Friday ruled that corporations set up by Congress for Alaskan Natives are eligible for a portion of the $8 billion in coronavirus relief funds that lawmakers set aside for tribal governments.
ODDS AND ENDS
The United Kingdom’s competition watchdog is launching an investigation into fake reviews on Amazon and Google, the regulator said Friday.
A business coalition led by Goldman Sachs, the Bipartisan Policy Center and Center Forward is pushing lawmakers to help small businesses access federal government contracts.