Infrastructure was a road to nowhere for former presidents Donald Trump and Barack Obama. But Joe Biden believes he can use it to drive America to the future after a dozen years of false starts. The trip is unlikely to be smooth.
Biden’s $2.3 trillion infrastructure package, released Wednesday, would go well beyond the usual commitments to roads and bridges to touch almost every part of the country. It’s a down payment on combating climate change, a chance to take on racial inequities, an expansion of broadband, an investment in manufacturing and a reorienting of corporate taxes to pay for everything. To succeed where his predecessors stalled, Biden will have to navigate a conflicting set of political forces with winners and losers all around.
The president resisted calls by business groups to pay for his plan with higher gas taxes and tolls, since the costs would be borne by working Americans and Biden had promised no tax hikes on anyone making less than $400,000. That’s according to an administration official who insisted on anonymity to discuss private conversations.
Yet the decision to keep that particular promise likely dooms any chance of wider bipartisan unity.
Biden’s proposal would gut the core of Trump’s 2017 tax cuts — an affront to many Republican lawmakers, who would also prefer that infrastructure stay in a narrow lane. The corporate tax rate would jump to 28% from 21% under Biden’s plan, and a global minimum tax would be charged to prevent companies from avoiding taxes.
Even before Biden delivered his opening speech on the plan, Republicans had latched on to Reagan-era labeling, dismissing the package as tax-and-spend liberalism. That’s an attack designed to erode public support as different components of the package get divvied up among congressional committees and begin their journey through Congress.
We sit down with two economists to dissect the plan and its potential impacts.
With files from the Associated Press.
Michael Mandel, chief economic strategist at the Progressive Policy Institute, a center-left think tank in Washington D.C.; senior fellow at the Wharton School of the University of Pennsylvania; he tweets @MichaelMandel
Chris Edwards, economist and director of tax policy studies at the Cato Institute, a libertarian leaning think tank in Washington D.C.; he is also editor of DownsizingGovernment.org, a Cato project that focuses on federal spending; he tweets @CatoEdwards