Another $2 Trillion: Here Are The Key Components of Biden’s Massive Infrastructure Plan
Following the passage of his $1.9 trillion American Rescue Plan, President Biden announced the next phase of his legislative agenda: a $2 trillion infrastructure omnibus package.
During a speech in Pittsburgh, the 46th President billed his American Jobs Act as a “once in a generation investment in America, unlike anything we’ve seen or done since we built the interstate highway system, and the space race decades ago.”
“In fact, it’s the largest American jobs investment since World War II,” he added.
From the first day of his administration, Biden has drawn inspiration from President Franklin D. Roosevelt, who passed massive infrastructure and jobs programs through his New Deal domestic agenda — a move which drastically increased the size and scope of the federal government. Indeed, Biden’s Oval Office hosts a large portrait of the Great Depression-era Commander-in-Chief.
The American Jobs Act seeks to “reimagine and rebuild a new economy” — specifically, by addressing the “climate crisis,” the “ambitions of an autocratic China,” and “persistent racial injustice.” Components of the $2 trillion legislation are sprinkled with provisions that claim to address these policy areas.
Here is an in-depth look at Biden’s latest major legislative proposal.
Roads and bridges — $621 billion
The largest portion of the American Jobs Act is a $621 billion allotment to roads, bridges, public transit, rail service, electric vehicles, and ports.
Stating that one in five miles of major American roadways is “in poor condition,” the Biden administration is asking for “$115 billion to modernize the bridges, highways, roads, and main streets that are in most critical need of repair.”
Part of this funding will involve money “to improve air quality, limit greenhouse gas emissions, and reduce congestion.” Biden calls for the prioritization of “the worst 10,000 smaller bridges, including bridges that provide critical connections to rural and tribal communities.” Under the $115 billion price tag will be a $20 billion fund for states and localities to improve road safety, “especially for cyclists and pedestrians.”
Noting that “households of color are twice as likely to take public transportation,” the plan allocates $105 billion for the Department of Transportation to fix 24,000 buses, 5,000 rail cars, and 200 stations. The plan would effectively double federal spending on public transportation, even after Congress allocated $20 billion to transit through the American Rescue Plan and $14 billion through the COVID-19 stimulus package passed in December.
Biden also wants to allocate $80 billion toward Amtrak to address the agency’s repair backlog, modernize the Northeast Corridor, and connect new city pairs.
Citing Chinese investment in electric vehicles, Biden proposed a $174 billion injection into the electric vehicle (EV) market. The legislation would “enable automakers to spur domestic supply chains from raw materials to parts, retool factories to compete globally, and support American workers to make batteries and EVs,” while offering “point of sale rebates and tax incentives” for electric vehicle consumers.
The legislation would also “replace 50,000 diesel transit vehicles and electrify at least 20 percent of our yellow school bus fleet through a new Clean Buses for Kids Program at the Environmental Protection Agency, with support from the Department of Energy.” Biden is eyeing a school bus and post office fleet completely reliant on electric vehicles.
Biden also calls for a $25 billion investment in airports and $17 billion in the port system — which includes a “Healthy Ports program to mitigate the cumulative impacts of air pollution on neighborhoods near ports, often communities of color.”
In another play to racial equity, the legislation will include $20 billion for “a new program that will reconnect neighborhoods cut off by historic investments and ensure new projects increase opportunity, advance racial equity and environmental justice, and promote affordable access.”
Energy and broadband internet — $200 billion
The American Jobs Act would shell out $200 billion to energy grid and internet improvements.
The first $100 billion would push the energy grid toward “cheaper, cleaner electricity.” The plan “will use the federal government’s incredible purchasing power to drive clean energy deployment across the market by purchasing 24/7 clean power for federal buildings” in a drive to reach carbon-pollution-free power by 2035.
Another $100 billion would fund broadband internet in “unserved and underserved areas so that we finally reach 100 percent high-speed broadband coverage.” The plan clarifies that it will ensure “funds are set aside for infrastructure on tribal lands and that tribal nations are consulted in program administration,” while promoting workers’ ability to “bargain collectively.”
Schools and housing — $213 billion
The American Jobs Act will allocate $213 billion to “build, preserve, and retrofit more than two million homes and commercial buildings to address the affordable housing crisis.”
This spending would fund the retrofitting of “more than a million” houses for “rental opportunities to underserved communities nationwide, including rural and tribal areas.” It would also “build and rehabilitate” over half a million homes for “low- and middle-income homebuyers” by offering $20 billion in tax credits through the Neighborhood Homes Investment Act.
The legislation will use $40 billion to improve “the infrastructure of the public housing system in America” to “disproportionately benefit women, people of color, and people with disabilities.”
The $213 billion in spending also includes a $100 billion payout to “upgrade and build new public schools, through $50 billion in direct grants and an additional $50 billion leveraged through bonds.” Also granting $12 billion to community colleges and $25 billion to childcare facilities, the legislation cites its resultant reduction in greenhouse gas emissions.
The education sector was also a recipient of billions in taxpayer dollars under the American Rescue Plan, which spent $130 billion on K-12 schools and $35 billion on universities.
Care infrastructure — $400 billion
The American Jobs Act also includes massive spending on the home care industry.
Stating that caregivers are “disproportionately women of color,” the plan would “put $400 billion toward expanding access to quality, affordable home- or community-based care for aging relatives and people with disabilities.”
The plan would likewise leverage Medicaid to expand home and community-based services, which will “support well-paying caregiving jobs that include benefits and the ability to collectively bargain” — which, according to the plan, would again benefit “low-income communities and communities of color.”
Research and development — $180 billion
Noting that “countries like China are investing aggressively in R&D,” the American Jobs Act would spend $180 billion on federal research programs.
Among these expenditures include $50 billion for the National Science Foundation’s research into “semiconductors and advanced computing, advanced communications technology, advanced energy technologies, and biotechnology.” Biden’s legislation also sets aside $40 billion to upgrade brick-and-mortar research facilities — half of which is earmarked specifically for Historically Black Colleges and Universities and other Minority Serving Institutions.
The legislation would likewise build a “new national lab focused on climate that will be affiliated with an HBCU.”
In addition to the $20 billion in infrastructure improvements, Biden is calling for another $10 billion in R&D investments at HBCUs, as well as $15 billion to build “200 centers of excellence that serve as research incubators at HBCUs and other MSIs.”
Again emphasizing the issue of climate change, the legislation would spend “$35 billion in the full range of solutions needed to achieve technology breakthroughs that address the climate crisis and position America as the global leader in clean energy technology and clean energy jobs.”
Corporate tax increase — 21% to 28%
Biden expects to fund the infrastructure plan by setting the corporate tax rate at 28% — an increase from the 21% rate established by President Trump. Biden’s plan says that such a shift would reverse the “damage” of the Tax Cuts and Jobs Act of 2017, while fundamentally reforming “the way the tax code treats the largest corporations.”
The plan would also raise taxes for American multinational companies that invest overseas while eliminating preferences for fossil fuel companies.
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