Postmortem of a megabill

Politico

13 hours ago

With help from Chris Marquette, Pavan Acharya and Oriana Pawlyk
QUICK FIX
— Congress passed President Donald Trump's reconciliation package, which included $12.5 billion for airspace upgrades. What's next for the overhaul?
— DOT is tweaking a credit assistance program for large infrastructure projects, aiming to lessen recipients' need for federal grants.
— There's been a big dip in freight movement between the U.S. and Mexico and Canada amid Trump's chaotic tariffs policy.
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Driving the Week
A WIN FOR TRUMP, AND DUFFY: After months of negotiations, Republicans on Capitol Hill have pushed through President Donald Trump's domestic policy package, leaving the Senate's high-profile transportation provisions unchanged, Sam reports. Those include about $12.5 billion for air traffic control upgrades, which DOT Secretary Sean Duffy has been pushing for as he aims to revamp the national airspace.
— The big question: What's next? As MT readers will know, Duffy has said this money isn't enough to get the job done, raising questions about where the remaining funds will come from. Duffy's timeline of three to four years to complete the project is ambitious, and he must move quickly if he has any chance of meeting his goal.
— In an X post, Duffy said he won't rest 'until this mission is complete.' A DOT spokesperson didn't answer questions from your MT host about what Duffy will prioritize when it comes to the $12.5 billion. Rep. Troy Nehls (R-Texas), chair of the House Transportation Committee's aviation panel, told Chris he thinks Duffy wants an additional $8 billion. 'Let's see how we spend' the existing dollars, Nehls said.
TICK TOCK: The FAA is seeking proposals from companies no later July 25 on the air traffic control effort.
SO MUCH MORE: The megabill, which Trump signed into law Friday, included other provisions touching on everything from new fees on commercial space launches and reentries — a major change for the booming industry — to the termination of electric vehicle tax credits on Sept. 30, which puts a massive dent into the Biden-era push toward zero-emissions cars. There's even language that will permanently erase pre-tax commuter benefits for those who bike to work, Pavan notes.
WHAT DIDN'T MAKE IT IN: A proposal from House Transportation Chair Sam Graves (R-Mo.) to impose new registration fees on EVs and hybrids, which would have been remitted to the flagging Highway Trust Fund, wasn't in the final text. (The Senate nixed this language.) But expect the idea to stage a comeback as lawmakers begin to draft the next surface transportation bill in earnest.
POLITICAL FALLOUT: Elon Musk, Trump's former bureaucracy-slashing adviser and the world's richest man, has clashed with his one-time buddy over the megabill, and said Saturday he was launching a new political party. 'Today, the America Party is formed to give you back your freedom,' he wrote on X, his social media platform. He added in a later post: 'The way we're going to crack the uniparty system is by using a variant of how Epaminondas shattered the myth of Spartan invincibility at Leuctra: Extremely concentrated force at a precise location on the battlefield.' He vowed to roll out his strategy during the 2026 midterms.
Infrastructure
FIRST IN MT: DOT is updating a credit assistance program that provides long-term, low-interest loans to infrastructure projects of regional or national significance in a bid to speed up the completion of construction and curtail recipients' need for federal grants. Historically, only limited kinds of projects could finance up to 49 percent of eligible costs under the Transportation Infrastructure Finance and Innovation Act, or TIFIA, program, with most loans being capped at up to 33 percent. DOT is now expanding the option to finance up to 49 percent, offering it to 'all types' of infrastructure projects in the sector.
— 'Unleashing the full value of the TIFIA program represents another step forward in getting America building again,' Duffy said in a statement.
Trade
KEEP AN EYE ON IT: Freight movement between the U.S. and Canada and Mexico dipped in April, DOT data shows — and experts say Trump's tariffs may be to blame, Pavan reports. (It was the largest month-over-month drop since the height of the Covid pandemic.) The decrease came as Trump's car duties kicked into gear.
— Sen. Gary Peters (D-Mich.) said the auto industry is trying to adjust to the new trade policy, and 'that may very well be reflected in those numbers.' Check out this chart to see what happened:
APPROPRIATIONS
NOT YET: Just a reminder: the House Appropriations Committee's transportation panel won't hold a markup Monday of its fiscal 2026 budget bill. The event was initially set for today, but has been pushed back to July 14 at 6 p.m.
Aviation
MAKING PROGRESS: The FAA, as anticipated, transitioned early Thursday to a new fiber optic communications network between facilities in New York and Philadelphia — a key upgrade following a series of technology disruptions at Newark Liberty International Airport earlier this year. (The line was laid in June and got tested over the past month.)
ICYMI: The NTSB has issued a preliminary report about how four T-38 Air Force jets bound for a flyover of Arlington National Cemetery in March narrowly avoided a Delta Air Lines plane taking off from Ronald Reagan Washington National Airport — one of several concerning incidents in the local airspace this year.
Transit
BIG RAMIFICATIONS? The Supreme Court on Thursday agreed to hear two cases involving NJ Transit, which is being sued in Pennsylvania and New York after its buses allegedly hit people outside the Garden State, Ry Rivard reports.
— The routine personal injury claims caught the high court's attention because in 2019, justices ruled 5-4 that one state can't be sued in another state's courts without the first state's consent. But the decision left one key issue unclear: what state entities get such immunity, such as transit providers.
Labor
SOME IMPROVEMENT: The unemployment rate for U.S. transportation was 4.5 percent (not seasonally adjusted) in June, new Bureau of Labor Statistics data show. That's a decrease compared to the rate in the same month last year, but above the pre-pandemic level of 4.1 percent in June 2019.
The Autobahn
— 'How China's new auto giants left GM, VW and Tesla in the dust.' Reuters.
— 'US factory orders rebound in May on strong aircraft demand.' Reuters.
— 'Exclusive: Regulators warned Air India Express about delay on Airbus engine fix, forging records.' Reuters.
— 'Savannah Bet Its Economy on a Big Hyundai Plant. Now It Has to Find the Workers.' Bloomberg.
— 'United, JetBlue Defend Alliance, Blast Spirit Air's Objections.' Bloomberg.
— 'Tesla Has a Problem — and It's Not Just the Elon Musk Backlash.' Bloomberg.
— 'Could the Electric Hydrofoil Ferry Change the Way We Commute?' New York Times.
— 'Has There Ever Been a Better Time to Buy an EV?' Wall Street Journal.
— 'Tesla Stock Diehards Don't Give an Inch.' Wall Street Journal.
— 'US imports from China in May fell to lowest in five years.' POLITICO.