President Joe Biden made his sales pitch on Wednesday for an infrastructure plan with a price tag of $2.3 trillion, a sweeping measure that includes $621 billion for transportation projects, $111 billion for water infrastructure and $100 billion for broadband.
“It’s a once-in-a-generation investment in America,” Biden said in a speech in Pittsburgh about his “American Jobs Plan.” He returned to the city in the swing state of Pennsylvania after having given his first 2020 presidential campaign speech there before a union audience.
“It’s big, yes. It’s bold, yes, and we can get it done,” he added.
The president’s infrastructure plan will unleash spending over eight years, the White House said in a “fact sheet” on Wednesday ahead of his speech.
The White House said proposed tax changes will “raise over $2 trillion over the next 15 years and more than pay for the mostly one-time investments in the American Jobs Plan and then reduce deficits on a permanent basis.” The changes include raising the corporate tax rate to 28% from 21%, hiking the global minimum tax on U.S. multinational companies, establishing what’s called a 15% minimum tax on book income, eliminating tax preferences for fossil fuels and ramping up enforcement against corporations.
“These are my ideas on how to pay for this plan,” Biden said during his speech, as he touched on the tax hikes. “If others have additional ideas, let them come forward. I’m open to other ideas, so long as they do not impose any tax increase on people making less than $400,000.”
Biden also promised to “bring Republicans into the Oval Office” and “listen to them.”
The $621 billion in transportation-related spending includes $115 billion to “modernize the bridges, highways, roads, and main streets that are in most critical need of repair,” $20 billion to improve road safety for all users, $85 billion to boost existing public transit and help agencies expand their systems, $80 billion to support Amtrak and other rail projects, $174 billion to help the U.S. electric-vehicles industry, $25 billion to aid airports, $20 billion for a new program to reconnect neighborhoods cut off by past infrastructure projects, and $17 billion to boost inland waterways, ports and ferries.
Biden’s plan would provide $400 billion for “the infrastructure of care in our country,” targeting the facilities or systems that care for the aging and those with disabilities, according to the White House.
It also calls for $213 billion to “build, preserve, and retrofit more than 2 million homes and commercial buildings to address the affordable housing crisis,” $100 billion for power infrastructure, $100 billion for workforce-development programs and 100 billion to upgrade and build public schools.
In addition, there is $180 billion for public investments in research and development to advance U.S. leadership in critical areas such as computing and climate science, $300 billion to “retool and revitalize American manufacturers and small businesses,” $25 billion to help upgrade child-care facilities and increase the supply of child care and $18 billion for the modernization of Veterans Affairs hospitals and clinics.
“Although we think there is a reasonable chance that Congress will pass some form of the Biden plan, it will be tougher to pass this plan than it was to pass the COVID-relief bill,” said Brian Gardner, chief Washington policy strategist at Stifel, in a note Wednesday.
“Some divisions are already apparent among Democrats,” Gardner added. “For example, some northeast Democrats have threatened to oppose an infrastructure bill if the state and local tax (SALT) deduction is not restored, and progressives are upset that this proposal did not include more on climate change. Climate-related proposals will likely be included in a ‘human infrastructure’ plan that could include education, family care and health-care proposals.”
In about a month, Biden is expected to roll out that second plan related to human infrastructure — which is also anticipated to have a price tag of about $2 trillion.
Hopes for increased infrastructure spending often have been dashed in recent years, turning “Infrastructure Week” into a joke in Washington. Republican lawmakers criticized Biden’s proposal on Wednesday.
“Unfortunately, the latest liberal wish-list the White House has decided to label ‘infrastructure’ is a major missed opportunity by this Administration” said Senate Minority Leader Mitch McConnell, the Kentucky Republican, in a statement.
“This proposal appears to use ‘infrastructure’ as a Trojan horse for the largest set of tax hikes in a generation. These sweeping tax hikes would kill jobs and hold down wages at the worst possible time, as Americans try to dig out from the pandemic,” McConnell added.
A key U.S. infrastructure ETF
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finished up by 0.4% and has advanced 18% over the past six months.