House Democrats have imposed a new deadline to pass the $1 trillion bipartisan infrastructure bill and advance the $3.5 trillion Build Back Better Act by October 31. House Speaker Nancy Pelosi (D-CA) initially said that they would hold a vote on the $1 trillion bipartisan infrastructure bill on September 30. However, progressive Democrats refused to move forward until Congress establishes a framework for the $3.5 trillion act, which also focuses on climate change, healthcare and education. Combined, this legislation will invest $4.5 trillion in Biden’s Build Back Better infrastructure agenda. Let’s break down what this could mean for you. (Note: This is a developing story, and we will continue to update the article as more information becomes available.)
How Biden’s $4.5 Trillion Plan Can Become Law
The House Budget Committee completed the virtual markup of the $3.5 trillion Build Back Better Act on September 25. The legislation will now move to the House Rules Committee for additional review and potential changes, before it can get submitted to a chamber vote.
Committee chairman John Yarmuth (D-KY) said via press release that the House is “one step closer to delivering these visionary investments to the American people” in “a paradigm shift.”
Pelosi followed with another press release a day later, saying that the chamber is “working together with the Senate and the White House on changes” to the Build Back Better Act.
The speaker initially pledged to pass the $1 trillion bipartisan bill with a September 30 deadline, which was when the extension for the Surface Transportation Reauthorization Act was set to expire.
Democrats, however, failed to meet this self-imposed deadline after progressive legislators in the party refused to support the $1 trillion bill until Congress agrees to move the $3.5 trillion Build Back Better Act forward. Pelosi then announced a new October 31 deadline in a letter to colleagues after a 30-day extension was passed for the Surface Transportation Reauthorization Act.
“We must pass BIF [stands for bipartisan infrastructure framework and refers to the $1 trillion bipartisan infrastructure bill] well before then – the sooner the better, to get the jobs out there,” she said.
The House Ways and Means Committee passed a part of the budget bill for the $3.5 trillion infrastructure plan on September 15 with a 24 to 19 vote. This legislation, which proposes over $2 trillion in tax hikes for corporations and the wealthy, did not have any Republican support. And while the tax provisions are smaller-scale than President Joe Biden’s initial proposals, one House Democrat also voted against them.
“I strongly support numerous provisions in the House Ways and Means portion of the Build Back Better Act, especially the historic provisions to combat the existential threat of climate change. But there are also spending and tax provisions that give me pause, and so I cannot vote for the bill at this early stage,” Murphy said in a press release.
The House initially voted on August 24 along party lines with 220 Democrats in favor and 212 Republicans against to pass a budget plan for the $3.5 trillion bill that was announced by the Budget Committee on July 13. As part of a compromise, Democrats have also pledged to hold a future vote on the $1 trillion bipartisan infrastructure bill that has already been approved by the Senate (adding up to $4.5 trillion in funding for Biden’s Build Back Better infrastructure agenda).
“This package, coupled with the bipartisan infrastructure plan, represents our firm belief that it’s not just the roads that get you to work that require funding, basic supports like child care and paid leave are also essential features of society worthy of investment,” said House Ways and Means Chairman Richard E. Neal (D-MA) on September 15 in a press release.
Pelosi told Democratic colleagues earlier on August 15 “to pass the budget resolution the week of August 23rd so that we may pass Democrats’ Build Back Better agenda via reconciliation as soon as possible.” She also asked the Rules Committee to “explore the possibility of a rule that advances both the budget resolution and the bipartisan infrastructure package.”
The announcement was made three days after nine moderate Democrats in the House said they would not vote on a budget resolution for the $3.5 trillion spending package that would fund Biden’s human infrastructure programs “until the bipartisan Infrastructure Investment and Jobs Act passes the House and is signed into law.”
The Senate passed the bipartisan infrastructure bill with a 69 to 30 vote on August 10. Legislators needed at least 60 votes to close the debate process and advance the legislation for approval. The debate process for the new bipartisan deal was opened on July 28 with 17 Republicans joining 50 Democrats in a 67 to 32 vote. One Senator abstained and two Republicans switched sides to support the bill in the final vote.
The bipartisan bill could authorize the federal government to spend new funds on roads and bridges, public transit, clean drinking water and waste water infrastructure, high-speed internet and clean energy, among other projects. The White House describes the legislation as “a once-in-a-generation investment in our infrastructure.”
The $3.5 trillion Build Back Better Act is expected to support bipartisan initiatives to rebuild physical infrastructure and push beyond to embrace Biden’s health, education and climate change legislation.
While some Republican Senators support the $1 trillion bipartisan infrastructure deal, they are expected to oppose the broader $3.5 trillion infrastructure agreement, which will most likely drive Democrats to pass legislation through the budget reconciliation process. This will enable them to get around the 60-vote Senate approval rule with a simple majority of one vote.
“We must keep the 51-vote privilege by passing the budget and work with House and Senate Democrats to reach agreement in order for the House to vote on a Build Back Better Act that will pass the Senate,” Pelosi said in a statement on August 24.
The legislative process to pass Biden’s $4.5 trillion infrastructure plan into law could take weeks or longer. A representative must first sponsor the bill and then get it assigned to a committee for review before the legislation can get voted on, debated or amended. Changes made to the legislation must also get approved in both chambers of Congress before it can get signed into law. Biden will have 10 days to sign or veto the bill after bicameral approval.
The president met with House Democrats on October 1 after they could not reach an agreement on the $3.5 trillion Build Back Better Act, and echoed Pelosi’s determination to pass the legislation.
“I’m telling you, we’re gonna get this done,” Biden told reporters.
What’s in the $550 Billion Bipartisan Infrastructure Bill?
The president joined a group of bipartisan Senators on July 28 to announce that they had reached a deal “to make the most significant long-term investment in our infrastructure and competitiveness in nearly a century.”
The 2,702-page legislative text for a $1 trillion infrastructure bill was presented on August 1. This legislation combines previously approved funds with $550 billion in new spending that the Senate approved as part of a bipartisan deal on July 28.
Let’s break down in the table below key components from this new bipartisan infrastructure bill. Budgets and programs are based on the White House Fact Sheet that was presented on July 28:
|$550 Billion Bipartisan Infrastructure Bill|
|$110 Billion||Roads, Bridges and Major Projects||Bridge and road repairs will focus on climate change mitigation, resilience, equity and safety for users, including pedestrians and cyclists. The proposal includes $40 billion for bridge repair, replacement and rehabilitation; and $16 billion for major projects. The White House says this is the largest investment in bridges since the interstate highway system was approved in 1956.|
|$105 Billion||Public Transit/Passenger and Freight Rail||Modernize and expand the transit rail networks for millions of Americans nationwide. The White House says this is the largest federal investment in public transit history ($39 billion), and the largest federal investment in passenger rail ($66 billion) since Amtrak was created.|
|$73 Billion||Power Infrastructure||Build thousands of miles of new, resilient transmission lines. This will facilitate and expand renewable energy. The White House calls this largest clean energy transmission investment in American History.|
|$65 Billion||High-Speed Internet||Inspired by historic effort to electrify every American home almost one hundred years ago, this plan aims to connect every American with reliable high-speed internet. The White House says this framework will lower service prices and close the digital divide.|
|$55 Billion||Clean Drinking Water||Deliver clean drinking water to 10 million American families and more than 400,000 schools and child care facilities. This will also remove lead service lines and pipes. The White House says this is the biggest investment in clean drinking water and waste water infrastructure in American History.|
|$50 Billion||Resilience and Western Water Infrastructure||Prepare infrastructure for the impacts of climate change, cyber attacks and extreme weather conditions. The White House says this is the biggest investment in the resilience of physical and natural systems in American history. Resilience can be defined as an infrastructure’s ability to absorb changes while retaining basic functionality and capacity.|
|$25 Billion||Airports||Modernize American airports with terminal renovations and multimodal connections that aim to provide affordable access for passengers and workers.|
|$65 Billion||Additional Programs||These include: Environmental Remediation ($21 billion). Ports and Waterways ($17 billion). Safety ($11 billion). Electrical Vehicle Infrastructure ($7.5 billion). Electric Buses/Transit ($7.5 billion). Reconnection Communities ($1 billion).|
What’s in the $3.5 Trillion Infrastructure Agreement?
Democratic legislators reached a $3.5 trillion Budget Committee agreement on July 13 to make the “biggest investment in the middle class in decades and act on the climate crisis.” The agreement, combined with the $1 trillion bipartisan plan, would add up to $4.5 trillion.
Senate Majority Leader Chuck Schumer (D-NY) says this will fund every major program that Biden asked for in his Build Back Better legislation proposals and make additions that expand Medicare, as well as healthcare funding for dental, vision and hearing.
“We are very proud of this plan. We know we have a long road to go. We’re going to get this done for the sake of making average Americans’ lives a whole lot better,” he told press.
The president met with the Senate Democratic Caucus on July 14 to support the Budget Committee agreement. The White House said that Biden described the Build Back Better agenda as a continuation of the American Rescue Plan, and emphasized that both economic policies are “built from the bottom up, with a recognition for the role that a good job plays in peoples’ lives.”
You should note that while the new bipartisan agreement aims to revitalize the American economy, it targets funds mostly for roads, water, electricity, broadband internet and other physical infrastructure projects.
Comparatively, the additional $3.5 trillion Budget Committee agreement focuses more on human infrastructure programs that expand Medicare funding and coverage, support affordable childcare and free college education initiatives, and create pathways for employment, as well as transform the country’s energy system to address climate change needs.
Budget Committee Chairman Bernie Sanders (I-VT) told press that the new Democratic agreement would “create millions of good paying union jobs rebuilding this country not only from a physical infrastructure, but dealing with the human needs of our people which are many, and which have long been neglected.”
The table below breaks down key components from the $3.5 trillion infrastructure agreement. Budgets and programs are based on the FY 2022 Budget Resolution Agreement Framework presented by Senate Democrats on August 9:
|$3.5 Trillion Infrastructure Agreement|
|$726 Billion||Committee on Health, Education, Labor and Pensions||Fund universal pre-K for 3- and 4-year olds. Provide child care for working families. Create tuition-free community college. Invest in HBCUs, MSIs, HSIs, TCUs, and ANNHIs. Increase the maximum Pell grant award. Invest in school infrastructure, student success grants, and educators. Fund primary care. Invest in maternal, behavioral and racial health equity. Fund pandemic preparedness initiatives. Promote workforce development and job training, among other initiatives.|
|$332 Billion||Committee on Banking, Housing and Urban Affairs||Create and preserve affordable housing. Provide down payment assistance, rental assistance, and other homeownership initiatives. Develop and revitalize communities through zoning, land use and transit improvements. Invest in public housing and sustainability.|
|$198 Billion||Committee on Energy and Natural Resources||Create a clean electricity payment program. Fund consumer rebates to weatherize and electrify homes. Finance domestic manufacturing of clean energy and auto supply chain technologies. Procure energy efficient materials. Fund climate research, infrastructure research for DOE National Labs, hard Rock mining and Department of Interior programs.|
|$135 Billion||Committee on Agriculture, Nutrition and Forestry||Fund agriculture conservation, drought and forestry programs to help reduce carbon emissions and prevent wildfires. Invest in rural development and rural co-op clean energy. Fund agricultural climate and infrastructure research, among other initiatives.|
|$107 Billion||Committee on the Judiciary||Seek lawful permanent status for qualified immigrants. Invest in smart and effective border security measures. Fund a community violence intervention initiative.|
|$83 Billion||Committee on Commerce, Science and Technology||Invest in technology and transportation. Fund research, manufacturing and economic development. Invest in coastal resiliency and healthy oceans. Fund National Science Foundation research and technology directorate.|
|$67 Billion||Committee on Environment and Public Works||Create clean energy technology accelerator to fund low-income solar and other climate-friendly technologies. Make environmental justice investments in clean water affordability and access, healthy ports and climate equity. Fund EPA climate and research programs. Make Federal investments in energy efficient buildings and green materials. Invest in clean vehicles. Administer a methane polluter fee to reduce carbon emissions.|
|$37 Billion||Committee on Homeland Security and Governmental Affairs||Electrify the federal vehicle fleet (including USPS and Non-USPS). Electrify and rehabilitate federal buildings. Improve cybersecurity infrastructure. Make border management investments, among other initiatives.|
|$25 Billion||Committee on Small Business and Entrepreneurship||Provide small business access to credit, investment, and markets.|
|$20.5 Billion||Committee on Indian Affairs for Health, Education and Housing Programs for Native Americans||Fund Native American health programs and facilities. Invest in education programs and facilities, as well as housing programs, energy programs, resilience and climate programs, BIA programs and facilities, language programs and the Native Civilian Climate Corps.|
|$18 Billion||Committee on Veterans Affairs for Upgrades to VA Facilities||Upgrade VA facilities.|
How Will Biden Pay for the Infrastructure Plan?
The Congressional Budget Office said on August 5 that the bipartisan infrastructure bill will increase the U.S. deficit by $256 billion from 2021 to 2031. This means that roughly half of the $550 billion in new spending for highways, transit programs, and other projects will be paid for by adding to the national debt.
Data from the University of Pennsylvania’s Penn Wharton Budget Model elevates the deficit to $351 billion. However, the analysis also concludes that the “proposal would have no significant effect on GDP by end of the budget window (2031) or in the long run (2050)”.
For reference, the Congressional Budget Office projects that the federal budget deficit will reach $3 trillion in fiscal year 2021 and average $1.2 trillion per year from 2022 to 2031. You should note that this estimate is based on the assumption that the current tax and spending laws remain the same.
The White House initially said that the bipartisan infrastructure plan would be financed by “closing the tax gap, redirecting unspent emergency relief funds, targeted corporate user fees, and the macroeconomic impact of infrastructure investment.”
Biden had also announced during his presentation of the American Jobs Plan in March that half of the infrastructure and jobs package could be paid for by raising corporate taxes from 21% to 28%, which would generate $1 trillion in additional revenue.
“We’re going to raise the corporate tax,” he said on March 31. It was 35%, which is too high. We all agreed, five years ago, it should go down to 28%, but they reduced it to 21%. We’re going to raise it back to — up to 28%. No one should be able to complain about that. It’s still lower than what that rate was between World War Two and 2017. Just doing that one thing will generate $1 trillion in additional revenue over 15 years.”
Note that the House Ways and Means Committee later proposed a lower graduated corporate tax increase up to 26.5% in September (see the House Ways and Means Committee Corporate Tax Proposals table below). This tax change aims to roll back President Donald Trump’s 2017 Tax Cuts and Jobs Act, which set the current 21% flat tax rate for all businesses. Trump’s tax reduction was a big change from previous tax years, which charged marginal rates across eight income tax brackets listed in the table below:
|2017 Corporate Tax Rates|
|$0 – $50,000||15%|
|$50,000 – $75,000||25%|
|$75,000 – $100,000||34%|
|$100,000 – $335,000||39%|
|$335,000 – $10,000,000||34%|
|$10,000,000 – $15,000,000||35%|
|$15,000,000 – $18,333,333||38%|
You should keep in mind that even when the corporate tax rate was as high as 35%, a 2013 report from the Government Accountability Office (GAO) initially estimated that U.S. corporations paid an average effective tax rate of 12.6%. This was later revised to 22.9%, but tax experts generally agree that most businesses do not pay the full corporate tax rate after claiming deductions and credits.
In an effort to rally support for the corporate tax hike, the president said during his March speech that almost one-fifth of Fortune 500 companies, including Amazon, took advantage of tax loopholes to avoid paying federal income taxes.
“In 2019, an independent analysis found that…91 Fortune 500 companies — the biggest companies in the world, including Amazon — they used various loopholes so they’d pay not a single solitary penny in federal income tax,” he said. “I don’t want to punish them, but that’s just wrong. That’s just wrong. A fireman and a teacher paying 22%? Amazon and 90 other major corporations are paying zero in federal taxes?”
Biden has also said that he would raise additional revenue to pay for the American Jobs Plan by establishing a global minimum tax rate of 21% to eliminate loopholes and foreign tax credits that large multinational companies could claim to avoid paying federal taxes.
“We’re establishing a global minimum tax for U.S. corporations of 21%,” the president said. “We’re going to level the international playing field. That alone will raise $1 trillion over 15 years. We’ll also eliminate deductions by corporations for offshoring jobs and shifting assets overseas.”
On April 5, Treasury Secretary Janet Yellen rallied behind Biden’s plan, calling for a global minimum corporate tax rate.
“Together we can use a global minimum tax to make sure the global economy thrives based on a more level playing field in the taxation of multinational corporations, and spurs innovation, growth, and prosperity.”
Six days after the American Jobs Plan was announced, Amazon founder and CEO Jeff Bezos said via Twitter that he also supports the rise of the corporate tax.
“Both Democrats and Republicans have supported infrastructure in the past, and it’s right time to work together and make this happen. We recognize this investment will require concessions from all sides — both on the specifics of what’s included as well as how it gets paid for (we’re supportive of a rise in the corporate tax rate).”
The table below breaks down seven specific corporate tax changes based on the proposals that the House Ways and Means Committee presented on September 13:
|House Ways and Means Committee Corporate Tax Proposals|
|Increase Graduated Corporate Taxes to 26.5%||The graduated corporate tax structure raises 18% on the first $400,000 of income; 21% on income up to $5 million, and 26.5% on all other income above that. The graduated rate phases out for corporations making more than $10 million. Personal services corporations are not eligible for graduated rates.|
|Raise Corporate Taxes on Overseas Earnings to 16.6%||The Global Intangible Low-Taxed Income (GITLI), which taxes earnings by U.S. controlled foreign corporations (CFCs), currently ranges from 10.5% to 13.125%. This proposal would raise the tax rate to 16.5625%.|
|Reduce the Qualified Business Asset Investment (QBAI) Exemption to 5%||The QBAI exemption allows companies to deduct 10% in foreign tangible assets like property and equipment from its GITLI income. The House proposes reducing this exemption to 5%. Biden initially wanted to eliminate the exemption altogether.|
|Raise the Base Erosion and Anti-Abuse Tax (BEAT) to 12.5% in 2024 and 15% in 2026 and After||BEAT levies a minimum 10% tax on foreign and domestic corporations doing business in the U.S. It aims to prevent large multinationals from moving profits outside of the country to avoid domestic tax liability. The proposal would raise BEAT up to 12.5% after December 31, 2023, and 15% after December 31, 2025. The the base erosion minimum tax amount would also be determined by taking into account tax credits.|
|Increase the Holding Period for Carried Interest and Capital Gains to Five Years||Investment funds currently holding assets for more than three years can benefit from the lower long-term capital gains tax, which the House proposes raising the top federal rate from 20% to 25% (28.8% with the 3.8% net investment income tax.) Assets held for less than three years are taxed at the higher ordinary income tax rate (the top marginal individual income tax rate is 37%, but the House also proposes raising it to 39.6%.) The new holding period for long-term capital gains would now be extended to five years.|
|Exclude Taxpayers With AGI Over $400,000 From Qualified Small Business Stock (QSBS) Exemptions||Currently capital gains from QSBS are exempt from federal taxes. The proposal amends section 1202(a) of the tax code to limit special 75% and 100% exclusion rates to taxpayers with an adjusted gross income less than $400,000. However, the baseline 50% exclusion rate would still be available to all taxpayers.|
|Invest $79 Billion in IRS Resources||This provision appropriates $78,935,000,000 for necessary IRS expenses to strengthen tax enforcement, increase voluntary compliance, and modernize information technology to support enforcement activities effectively.|
For a comparison, the table below breaks down eight initial corporate tax changes that the White House fact sheet presented on March 31:
|Biden Tax Plan for Corporations|
|Raise Corporate Tax Rate to 28%||Roll back Trump’s 2017 corporate tax reduction, which currently set a 21% flat tax for all businesses. This increase aims to generate $1 trillion in additional revenue over 15 years.|
|Increase Global Minimum Tax to 21%||Increase the global minimum tax on U.S. corporations from 10.5% to 21%. Multinationals currently shift profits and jobs overseas with a tax exemption for the first 10% return on foreign assets, and the rest is taxed at half the domestic rate. Biden said this will generate an additional $1 trillion in 15 years.|
|Prevent Tax Havens for U.S. Corporations||Prevent U.S. corporations from inverting or claiming tax havens as a residence to avoid paying taxes. Currently, U.S. corporations can acquire or merge with foreign companies to claim that they are a foreign company even while managing and running operations in the U.S.|
|Eliminate Expense Deductions for Offshoring Jobs||Eliminate and replace tax expense deductions that U.S. companies can write off from offshoring jobs and provide a tax credit to support the on-shoring of jobs.|
|Eliminate Loophole for Intellectual Property||Eliminate the Foreign Derived Intangible Income (FDII) enacted by the Trump tax plan, which the White House describes as an intellectual property loophole that allows corporations to get tax breaks for shifting assets abroad. This revenue will be used to expand R&D investment incentives.|
|Enact 15% Minimum Tax on Large Corporations||Apply a 15% minimum tax on the book income of the largest corporations. Corporations use this income to report profits to investors.|
|Eliminate Tax Preferences for Fossil Fuels||Eliminate current subsidies, loopholes and special foreign tax credits available to the fossil fuel industry. Make polluters pay into a Superfund Trust Fund to cover the cost of cleanups.|
|Invest in IRS Resources||Increase IRS funding to enforce the tax law and prevent tax evasion from corporations. The White House says that 10 years ago almost all large corporations were audited annually. Today that number has fallen to less than half.|
How Does Biden’s Original $2.3 Trillion Plan Compare?
Biden’s original infrastructure proposal called for an infrastructure and jobs plan that would have spent more than $2 trillion, or 1% of the U.S. GDP annually. His American Jobs Plan, which was presented in March, similarly focused on clean-energy, electric automobiles, nationwide broadband access and workplace development programs, among other investments.
For a comparison with the bipartisan deal, more than half of the president’s first infrastructure plan targeted transportation, elderly and disabled care, and manufacturing—adding up to $1.321 trillion. The plan also called specifically to fund $213 billion for housing and $180 billion for tech research and development, as well as investing $311 billion in water, clean-energy and internet systems; $100 billion to upgrade and build schools and child care centers, and $100 billion in workforce training over the next eight years.
The table below breaks down key components from Biden’s original infrastructure and jobs plan. Programs and budgets are based on the White House Fact Sheet that was presented on March 31:
|Biden’s $2.3 Trillion American Jobs Plan|
|$621 Billion||Transportation||Repair roads and bridges ($115 billion). Modernize public transit ($85 billion). Invest in passenger and freight rail service ($80 billion). Build electric vehicles ($175 billion). Improve ports, waterways and airports ($42 billion). Redress historic inequities and advance future infrastructure ($45 billion). Improve infrastructure resilience ($50 billion).|
|$400 Billion||Elderly and Disabled Care||Expand access to affordable homes or community-based care. This includes: Expanding access to long-term care services under Medicaid. Create infrastructure for well-paying caregiving jobs.|
|$300 Billion||Manufacturing||Strengthen manufacturing supply chains for critical goods. This includes: Creating a new office at the Department of Commerce to monitor domestic industrial capacity and fund production ($50 billion). Semiconductor manufacturing and research ($50 billion). Invest in countermeasures to protect against future medical pandemics and prevent severe job losses. ($40 billion). Clean energy manufacturing ($46 billion). Invest in regional innovation hubs and a Community Revitalization Fund ($20 billion). Invest in domestic manufacturers ($52 billion). Create national small business incubator and innovation hub network ($31 billion). Partner with rural and Tribal communities to create jobs and support economic growth ($5 billion).|
|$213 Billion||Housing||Produce, preserve and retrofit over two million affordable and sustainable homes. This includes: Tax credits to rehabilitate or build 500,000 low and middle class homes ($20 billion). Improve public housing system infrastructure ($40 billion). Clean energy investment to upgrade homes and businesses ($27 billion).|
|$180 Billion||Tech Research and Development||Upgrade American research infrastructure ($40 billion). Promote collaboration and build on government programs ($50 billion). R&D job creation and innovation ($30 billion). Clean energy technology and clean energy jobs ($35 billion). Climate-focused research and climate R&D projects ($20 billion). R&D investment at HBCUs and other MSIs ($25 billion).|
|$111 Billion||Water||Replace lead pipes and service lines ($45 billion). Upgrade and modernize national drinking water, wastewater and stormwater systems; and tackle new contaminants and support rural clean water infrastructure nationwide ($66 billion).|
|$100 Billion||Internet||Build high-speed broadband infrastructure to reach 100% coverage nationwide. Promote price transparency and competition among internet providers. Reduce broadband internet cost through widespread service.|
|$100 Billion||Power||Build an electric transmission system that moves cheap, clean electricity nationwide. Modernize power generation to deliver clean electricity. Plug orphan oil and gas wells and clean up abandoned mines ($16 billion). Remediate and redevelop Brownfield and Superfund sites ($5 billion). Public land and water conservation jobs ($10 billion).|
|$100 Billion||Schools||Upgrade and build new public schools ($50 billion direct grants, $50 billion leveraged through bonds). Invest in community college infrastructure ($12 billion). Upgrade and build new child care facilities ($25 billion).|
|$100 Billion||Workplace||Support workers with next generation training programs. This includes: Creating a new Dislocated Workers Program and sector-based training ($40 billion). Target workforce development opportunities in underserved communities ($17 billion). Increase the capacity of existing workforce development and worker protection systems ($48 billion).|
|$28 Billion||VA Hospitals and Federal Buildings||Modernize Veterans Affairs hospitals and clinics ($18 billion). Buy, build or renovate federal buildings ($10 billion).|
Keep in mind that Republicans had also presented an alternative infrastructure plan worth approximately one-quarter of Biden’s original plan ($568 billion) on April 22. The Republican counterproposal limited spending to rebuilding roads and bridges, airports and ports, public transit systems, water, broadband and other networks.
So What Could the American Jobs Plan Mean for You?
Politicians on both sides of the aisle have looked towards infrastructure as a way to lay the foundation for a unified country. But Biden said last March that the American Jobs Plan aims to do more than just fix potholes and reduce gridlock traffic. His plan aims to rebuild the middle class so that a greater number of people could prosper.
“You know, this is not to target those who’ve made it; not to seek retribution. This is about opening opportunities for everybody else,” he said in April. “And it’s time — in this time, we’ll rebuild the middle class. We’re going to bring everybody along. Regardless of your background, your color, your religion, (inaudible) everybody gets to come along.”
The American Society of Civil Engineers also points out that without necessary investments in infrastructure, families will lose more than $3,300 in disposable income every year between 2020 and 2039 – that’s roughly $9 per day or $66,000 in 20 years – due to deficiencies.
SmartAsset’s 2021 study also shows that infrastructure needs are uneven across the country. Electric outages in Arizona, for example, could last only about 53 minutes on average. While an outage in West Virginia could last more than seven times longer than Arizona. For more information, read SmartAsset’s state rankings for the best infrastructure in 2021 and 2019.
Let’s take a look at four ways the new bipartisan infrastructure plan will impact you the most:
You will save time on your commute. The U.S. Census Bureau says that the average commute for 148 million workers in 2019 took 27.6 minutes to get to work each way. This is an all-time record high since the bureau started collecting travel data in 2006. The White House also points out that households taking public transportation to work “have twice the commute time.” The bipartisan plan calls on Congress to invest $105 billion in public transit and passenger and freight rail, as well as an additional $7.5 billion that will also in part fund electric buses. These upgrades aim to ultimately reduce traffic congestion for everyone.
The government will build chargers for your electric car. Biden initially wanted to provide tax incentives and point-of-sale rebates to help “all American families afford clean vehicles of the future.” He has already proposed $174 billion for electric vehicles and charging stations, which includes $100 billion in consumer rebates. But the White House says the bipartisan plan calls on Congress to invest only $7.5 billion to “build a national network of electric vehicle (EV) chargers along highways and in rural and disadvantaged communities.” The president set an initial goal of building 500,000 EV chargers by 2030.
You will have faster and cheaper internet. Biden wants to connect “high-speed, affordable, reliable Internet wherever you live.” The White House says that more than 35% of rural America lacks access to reliable high-speed internet. And the new bipartisan deal allocates $65 billion to bridge the internet gap between rural and urban Americas with the construction of high-speed broadband infrastructure that can reach 100% coverage nationwide.
More pathways to good-paying jobs. Biden wants clean energy and infrastructure investments from the federal government to support prevailing wages and labor jobs. The White House says that the bipartisan infrastructure plan can “create good-paying union jobs and advance environmental justice.”
The House Budget Committee has advanced the $3.5 trillion Build Back Better Act. Now, the legislation will move on to the House Rules Committee, where it will get submitted to more potential changes before the chamber can vote on it. House Speaker Nancy Pelosi (D-CA) has imposed a new October 31 deadline to hold another vote for the $1 trillion bipartisan infrastructure bill and move the $3.5 trillion Build Back Better Act forward.
Biden’s combined $4.5 trillion infrastructure plan supports investments in roads, water, electricity, broadband internet and other physical infrastructure projects, and expands legislation substantially to include health, education and climate change proposals from his Build Back Better agenda.
The White House says the legislation will create good-paying union jobs and economic growth for a generation of Americans, and position the United States as a 21st century leader in technology and the environment.
“This deal signals to the world that our democracy can function, deliver, and do big things,” Biden said on July 28. “As we did with the transcontinental railroad and the interstate highway, we will once again transform America and propel us into the future.”
The infrastructure bill needs approval from both chambers of Congress before it could get signed into law.
SmartAsset will continue to update this article as soon as more information becomes available.
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