WASHINGTON — President Joe Biden wants $2 trillion to reengineer America’s infrastructure and expects the nation’s corporations to pay for it.
The president travels to Pittsburgh on Wednesday to unveil what would be a hard-hatted transformation of the U.S. economy as grand in scale as the New Deal or Great Society programs that shaped the 20th century.
White House officials say the spending over eight years would generate millions of new jobs as the country shifts away from fossil fuels and combats the perils of climate change. It is also an effort to compete against the technology and public investments made by China, the world’s second-largest economy and fast gaining on the United States’ dominant position.
White House press secretary Jen Psaki said the plan is “about making an investment in America — not just modernizing our roads or railways or bridges but building an infrastructure of the future.”
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Biden’s choice of Pittsburgh for unveiling the plan carries important economic and political resonance. He not only won Pittsburgh and its surrounding county to help secure the presidency, but he launched his campaign there in 2019. The city famed for steel mills that powered America’s industrial rise has steadily pivoted toward technology and health care, drawing in college graduates from western Pennsylvania in a sign of how economies can change.
The Democratic president’s infrastructure projects would be financed by higher corporate taxes — a trade-off that could lead to fierce resistance from the business community and thwart any attempts to work with Republicans lawmakers. Biden hopes to pass an infrastructure plan by summer, which could mean relying solely on the slim Democratic majorities in the House and the Senate.
The White House says the largest chunk of the proposal includes $621 billion for roads, bridges, public transit, electric vehicle charging stations and other transportation infrastructure. The spending would push the country away from internal combustion engines that the auto industry views as an increasingly antiquated technology.
Another $111 billion would go to replace lead water pipes and upgrade sewers. Broadband internet would blanket the country for $100 billion. Separately, $100 billion would upgrade the power grid to deliver clean electricity. Homes would get retrofitted, schools modernized, workers trained and hospitals renovated under the plan, which also seeks to strengthen U.S. manufacturing.
The new construction could keep the economy running hot, coming on the heels of Biden’s $1.9 trillion coronavirus relief package — economists already estimate it could push growth above 6% this year.
Separately, Biden will propose in the coming weeks a series of soft infrastructure investments in child care, family tax credits and other domestic programs, another expenditure of roughly $2 trillion to be paid for by tax hikes on wealthy individuals and families, according to people familiar with the proposal.
Funding the first $2 trillion for construction and “hard” infrastructure projects would be a hike on corporate taxes that would raise the necessary sum over 15 years and then reduce the deficit going forward, according to a White House outline of the plan. Biden would undo the signature policy achievement of the Trump administration by lifting the corporate tax rate to 28% from the 21% rate set in a 2017 overhaul.
To keep companies from shifting profits overseas to avoid taxation, a 21% global minimum tax would be imposed. The tax code would also be updated so that companies could not merge with a foreign business and avoid taxes by moving their headquarters to a tax haven. And among other provisions, it would increase IRS audits of corporations.
White House officials led by National Economic Council Director Brian Deese offered a private briefing Tuesday for top lawmakers in both parties. But key GOP and business leaders are already panning the package.
“It seems like President Biden has an insatiable appetite to spend more money and raise people’s taxes,” Rep. Steve Scalise of Louisiana, the GOP whip, said in an interview.
Scalise predicted that, if approved, the new spending and taxes would “start having a negative impact on the economy, which we’re very concerned about.”
The business community favours updating U.S. infrastructure, but it dislikes higher tax rates. An official at the U.S. Chamber of Commerce who insisted on anonymity to discuss the private talks said the organization fears the proposed tax hikes could undermine the gains from new infrastructure. The Business Roundtable, a group of CEOs, would rather have infrastructure funded with user fees such as tolls.
Pittsburgh is a series of steep hills and three intersecting rivers. Its steel mills once covered the sky in enough soot that men needed to take spare white shirts to work because their button downs would turn to gray by lunch. Only last year the city, amid the coronavirus pandemic, met Environmental Protection Agency standards for air quality, even though it is increasingly the home of tech and health care workers with college degrees.
Infrastructure spending usually holds the promise of juicing economic growth, but by how much remains a subject of political debate. Commutes and shipping times could be shortened, while public health would be improved and construction jobs would bolster consumer spending.
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Standard & Poor’s chief U.S. economist, Beth Ann Bovino, estimated last year that a $2.1 trillion boost in infrastructure spending could add as much as $5.7 trillion in income to the entire economy over a decade. Those kinds of analyses have led liberal Democrats in Congress such as Washington Rep. Pramila Jayapal to conclude Tuesday, “The economic consensus is that infrastructure pays for itself over time.”
But the Biden administration is taking a more cautious approach than some Democrats might like. After $1.9 trillion in pandemic aid and $4 trillion in relief last year, the administration is trying to avoid raising the debt to levels that would trigger higher interest rates and make it harder to repay.
Psaki said Tuesday that Biden believes it’s “the responsible thing to do” to pay for infrastructure through taxes instead of borrowing. But the White House in its outline of the plan also couched the tax hikes as a matter of fairness, noting that 91 Fortune 500 companies paid $0 in federal corporate taxes in 2018.
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“An official at the U.S. Chamber of Commerce who insisted on anonymity to discuss the private talks said the organization fears the proposed tax hikes could undermine the gains from new infrastructure. The Business Roundtable, a group of CEOs, would rather have infrastructure funded with user fees such as tolls”. The Chamber of Commerce, the Business Round Table were anti -Trump and now they are crying with Biden in office. What a joke!!! Lower raises for American workers and raising prices for the consumer, all products of raising taxes. But, like Joe said, the middle class will not pay more in taxes, but they will pay more for consumer products.
AND then pay as more companies MOVE BACK OVERSEAS thus killing the job market.
When will these moronic self-serving Politicians understand that corporations DO NOT PAY TAXES. They Pay bribes in the form of campaign donations, and pass the taxes on to the consumers in the form of higher prices, or lower quality products. The entitlement receiving social dependents can’t pay, so the working-class productive Americans are the ones who pay the cost of the taxes socially redistributed in the form of higher prices, and their children pay the interest in the form of national debt, and devalued American currency. This political shill game is as dishonest a crime as anything the Crime Lords and mafia guys dreamt up to convince their victims of the necessity of the imagined protection money spent to provide social benefits and protection that NEVER actually appear, or measure up to the promises made. We are now a nation run by a party of Criminals, disguised as social workers educated and designed to only work to the benefit of themselves. All others just become their victims in the form of useful idiots. The media become their advertising agencies and co-conspirators in the theft.
THEY ALREADY KNOW That.. They just don’t give a stinking pile of maneure..
Biden wants $2 trillion to reengineer America’s infrastructure and expects the nation’s corporations to pay for it.
Corporations don’t pay taxes, consumers pay taxes.
True but sadly there a great many who see this and say “he’s taxing the but not me”. That’s how dumb a lot of Americans are.
AND folks wonder, WHY I want an IQ test, to register to vote!
Hell, maybe we need to start instituting a min IQ level, to BREED!!
Gee . . .there was an old fable about killing the goose that laid the golden eggs. Apparently either the lesson is lost on the left or these demonic parasites know exactly what they are doing and what the consequences will be to the economy and the resulting bankruptcy of the nation.
First you have to skin the animal, before you can eat it whole.
the destruction of our economy means nada to the leftist demons in washington dc aka hell.
the repubicans are feckless and have no cohones to fight for americans or america.
my government sickens me and disgust me,they steal my money and give it away to other countries undesirables who flood across our borders at will.
politicians need to go to jail for this.
IMO the destruction of our economy IS ONE OF THEIR MAIN GOALS, in the road to destroying america itself.
Like we didn’t expect this to happen. Set us up with the One of the Two punch and Covid bailouts and now the Two with this knuckle headed idea.
Why bother, if the taxation goes into effect and the infrastructure is built no one will be able to afford to use it, neither the businesses nor the ordinary citizens, only politicians and their toadies!
There is none so blind as he who will not see. Fools and blind!
Raising Corporate Taxes will only make WE the PEOPLE pay more to Services & Items they represent.
Look at Prices now going up. In the last couple of months a can of dogfood for my dog went from .83 cents to $1.09. Just take a walk through your grocery store, plus fuel prices w/o the Pipeline & Job Loses. Its going to get worse people. Something we have Never seen before.
Gov’t Democrats do Not Care about the American people.
Heck they just gave our Stimulus money for Illegals to Stay in Hotels $83 MILLION TAX DOLLARS, that does not include everything else they will need to live. Adding to our National Debt.
WAKE UP AMERICANS, before theres NO Return
I honestly feel we’re already PAST that point of no return.. ALL NO thanks to the demented democrat voters, AND ALL THe unions who’ve brainwashed generation after generation into hating this nation.
Democrats are able to sell the premise that only “rich people” and “corporations” will be punished and have to pay for their drunken sailor spending of “infrastructure improvement” to their double digit IQ followers. Comparable to “Only the rich people on the promenade deck will be hurt when we steer the Titanic toward the ice berg—not the poor people below deck.