Joe Biden will unveil an expansive $2tn proposal to rebuild the country’s infrastructure, confront climate change and curb wealth inequality, part of a sweeping spending package that could define the president’s economic legacy.
Biden’s plan, which he will lay out at a speech in Pittsburgh on Wednesday afternoon, includes “historic and galvanizing” investments in traditional infrastructure projects such as roads, bridges and highways, as well as hundreds of billions of dollars to fortify the electricity grid, expand high-speed broadband and rebuild water systems to ensure access to clean drinking water, an administration official said on Tuesday. It also seeks to expand access to community care facilities for seniors and people with disabilities and invest in research and development and workplace training.
He will propose paying for the new spending with a substantial increase on corporate taxes that would offset eight years of spending over the course of 15 years, officials said. Among the changes, Biden will call for a rise in the corporate tax rate to 28% from 21% and measures to force multinational corporations to pay more taxes in the US on profits earned abroad. The tax plan would unwind major pieces of Donald Trump’s tax-cut law, which lowered the corporate tax rate from 35% to 21%.
The package, known as the American jobs plan, is only the first part of the president’s sprawling infrastructure agenda. Aides say he will present a second legislative package next month that will focus on investments in healthcare, childcare and education. That package is expected to be paid for, at least in part, by raising taxes on the nation’s highest earners.
As a candidate, Biden promised not to raise individual taxes on those earning less than $400,000.
The scale of the proposals, together expected to cost as much as $4tn, has been compared to Franklin Roosevelt’s New Deal or Lyndon Johnson’s Great Society. A memo outlining its ambition states: “Like great projects of the past, the president’s plan will unify and mobilize the country to meet the great challenges of our time: the climate crisis and the ambitions of an autocratic China.”
Biden’s allies on Capitol Hill are gearing up for a fight over the infrastructure legislation that will likely prove to be significantly more contentious than the swift passage of Biden’s $1.9tn economic aid bill, which was enacted earlier this month with only Democratic votes.
While the urgency of the pandemic helped Democrats overcome a handful of objections to pass Biden’s coronavirus relief plan, there is infighting over what belongs in the package – and whether the administration should spend time attempting to forge a bipartisan consensus.
Both Democrats and Republicans share a goal of fixing the nation’s ageing roads, bridges and other critical infrastructure. Yet they disagree sharply on the details – how much to spend, what constitutes “infrastructure” and how to pay for the investments. This chasm was too big for either Barack Obama or Trump to overcome and both failed to make progress after promising to rebuild the country’s infrastructure.
In a briefing with reporters on Tuesday night, the administration official said Biden believed the current moment offered a rare opportunity “to demonstrate that the United States and democracies can deliver for the people that they serve”.
“The stakes of this moment are high,” the official continued, adding that the president was confident this package would prove once again that massive public investment programs have the ability to not only create millions of new jobs but “revive and revitalize our national imagination”.
“We think that these are investments that as a country we cannot afford not to make,” the official said.
But congressional Republicans are already balking at the scope of the project, warning that the tax rises will hurt American competitiveness and slow the nation’s economic growth as it struggles to rebound from the pandemic. Their opposition could force Democrats to pass the bill through reconciliation, a parliamentary process that would allow them to bypass Republicans in the Senate.
Even then, rank-and-file Democrats are far from aligned. With a narrow majority in the House and an evenly divided Senate, Biden has little room for error and the jockeying is already well underway as Democrats push an array of competing policy demands and ultimatums.
On Tuesday, congressman Josh Gottheimer, a centrist Democrat from New Jersey, said he would oppose any tax proposals that did not include a repeal of the cap on state and local tax deductions implemented as part of the Republican’s 2017 GOP tax-cut plan.
Meanwhile, liberal lawmakers want to see Biden go even bigger. On Monday, senator Edward Markey and congresswoman Debbie Dingell proposed a climate and infrastructure plan that would spend $10tn over the next decade.
There is also an internal debate over how to proceed. Moderate Democrats say the package should be targeted to attract Republicans, fulfilling a campaign promise Biden made to work with members of both parties. But many progressives see little value in compromise.
Congresswoman Pramila Jayapal, chair of the Congressional Progressive Caucus, urged the administration not to waste precious time attempting to woo Republicans.
“We can’t wait for Republicans to have some awakening on climate change here – we’ll be waiting forever if we do that,” she said on Tuesday “We’ve got a window to get this done and we have to move with the urgency and the boldness that this moment calls for.”
Source: US Politics - theguardian.com
