Biden unveils $2T American Jobs Plan to boost infrastructure

The White House is set to announce a massive plan for everything from highway bridges to electric-vehicle charging stations funded by tax hikes on corporations.

United States President Joe Biden's American Jobs Plan, set to be announced in Pittsburgh, Pennsylvania, will total $2 trillion in projects [File: Evan Vucci/AP Photo]

United States President Joe Biden is set to unveil an ambitious development plan Wednesday that includes boosting the country’s ageing infrastructure and fighting climate change — all paid for with a series of tax increases on corporations.

It’s the veteran inside-the-beltway dealmaker’s answer to former President Donald Trump’s lacklustre “infrastructure week”, an initiative that became a long-running, Groundhog Day-esque joke in Washington when it failed to get off the ground because it was too expensive and complicated.

Despite his previous career in real estate, Trump’s penchant for building never did shine brightly in the White House. Now, Biden has set an agenda to rebuild the US’s roads, bridges, ports, airports and more, an endeavour that comes on the heels of his $1.9 trillion American Rescue Plan that pumped stimulus money into the coronavirus-ravaged American economy.

The first half of Biden’s Build Back Better package, the American Jobs Plan, is set to be announced in Pittsburgh, Pennsylvania, with projects costing around $2 trillion. The second half of the proposal, the American Families Plan, is for big-ticket programmes around “social infrastructure” like universal pre-kindergarten and health-care reforms and will likely take shape as an additional $2 trillion bill a few weeks down the road.

“America has underinvested in infrastructure for more than a generation,” Aaron Klein, a senior fellow at the Brookings Institution, told Al Jazeera. “The devil is always in the details, but it is a promising sign that President Biden is thinking big and bold.”

“The interstate system famously began under President Eisenhower in the 1950s and ordinary Americans benefit from it every day,” he added. “Infrastructure takes time to build but the benefits last for generations.”

‘Only as strong as its weakest link’

The first step, many experts say, is to fix and upgrade old highways, tunnels, dams and levees to the tune of $1 trillion.

“We’re good at building shiny new stuff,” Rick Geddes, a professor of infrastructure policy at Cornell University, told Al Jazeera. “But we’re not good at taking care of what we already have.”

Geddes told Al Jazeera the $12bn Gateway Program typifies this type of necessary deferred work, shoring up a century-old rail connection under the Hudson River into New York City.

On the 2020 campaign trail, Biden touted his Build Back Better package and pledged to reverse the steep decline in US infrastructure, promising to invest in everything from ports and airports to schools and universal broadband.

“The Biden administration has demonstrated a commitment to building better, stronger, more resilient and sustainable infrastructure,” Emily Feenstra, the managing director of government relations and infrastructure initiatives at the American Society of Civil Engineers (ASCE), told Al Jazeera.

While it’s nice to see some quick fixes such as pothole repairs, this administration seems to want to focus on long-term, major projects that will take some time to get completed but offer the best bang for the buck and community benefits.

by Emily Feenstra, American Society of Civil Engineers

Feenstra said the new plan will “tackle our growing maintenance backlog, which will improve existing infrastructure assets such as [mass] transit, roads, and water systems, and bring them to a state of good repair”.

Feenstra also highlighted how the proposal will call for major investments in sustainability and climate-focused projects around renewable energy sources.

Those upgrades are sorely needed; ASCE recently released a 2021 report card showing the immense infrastructure challenges in the US, including the impact of the coronavirus pandemic on infrastructure revenue streams.

US President Joe Biden and Transportation Secretary Pete Buttigieg met with Congressional transportation and infrastructure leaders in the Oval Office of the White House to discuss infrastructure projects on March 4 [File: Andrew Harnik/AP Photo]

In that analysis, ASCE gave a “D” grade to many US legacy transportation and water-resource systems, which the report said suffer from “chronic underinvestment”.

“Our infrastructure system is connected and only as strong as its weakest link,” said Feenstra, adding that the cost of inaction already amounts to $3,300 per year for every US family.

Another study from ASCE revealed that — if left to fester — infrastructure inadequacies could cause the loss of $10 trillion in gross domestic product and $23 trillion in lost business productivity over the next two decades.

“While it’s nice to see some quick fixes such as pothole repairs,” Feenstra said, referring to anticipated signs of roadwork, like orange cones everywhere, “this administration seems to want to focus on long-term, major projects that will take some time to get completed but offer the best bang for the buck and community benefits”.

‘Another infrastructure week’

But not everyone is on board with the federal government leading the charge to fix broken bridges, ageing rail lines and leaky water mains.

“I guess we’ve got another infrastructure week,” Robert Krol, a senior affiliated scholar for the libertarian-leaning Mercatus Center at George Mason University, said facetiously. “But we don’t know the details yet.”

Krol told Al Jazeera that infrastructure investment “is not designed to speed up recovery out of a recession because there are not that many shovel-ready projects”.

He explained that the long process for identifying projects, designing them and finding the right contractors takes many years. Krol also criticised the “misleading” assumption that millions of jobs will be created, “as not everybody can switch from the service sector to highway construction jobs”.

It’s going to be tough to get a bill passed if you lump all that (infrastructure from different sectors) together, but there will be some really interesting horsetrading going on.

by Robert Krol, Mercatus Center

Calling the infrastructure plan a “monster” package, Krol said that states could be more efficient, targeted and flexible in funding their own priorities.

He also threw cold water on the effectiveness of increasing personal tax rates, suggesting that “you really want users of roads or bridges or a transit system [to be] the ones paying for it”.

Undoubtedly, the price tag of Biden’s multifaceted infrastructure vision could endanger legislative success if Democrats get tripped up on arcane rules about what counts as “budget reconciliation”.

On Monday, Transportation Secretary Pete Buttigieg ruled out that a petrol or mileage tax would be a part of the plan. The funding sources remain somewhat of a mystery.

“It’s going to be tough to get a bill passed if you lump all that [infrastructure from different sectors] together, but there will be some really interesting horsetrading going on,” added Krol.

‘Revolution in economics’

For many Democrats, Biden’s gambit to secure massive infrastructure spending has the potential to be earth-shattering and could boost Americans very broadly.

“Biden is not going to let Republicans hijack the economic future of the American people,” Paul Bledsoe, a strategic adviser at the Progressive Policy Institute, told Al Jazeera. “It will address the lack of access to the building blocks of a successful livelihood.”

Bledsoe, who worked on climate policy in the administration of former US President Bill Clinton, called Biden’s infrastructure aims nothing less than a “revolution in economics”.

“The sheer size of the $3 trillion package would dwarf anything ever been done, anywhere in the world,” Bledsoe told Al Jazeera, calling it “the largest infrastructure effort in history”.

He said the plan “reflects new belief that government funding should be in the service of long-term economic investment” and added that many Americans now have “less concern about debt and inflation”.

The infrastructure package, Bledsoe said, could drive “the rebirth of the American growth rate to three or four or five percent for many years in a row”.

Source: Al Jazeera