“This is the largest investment in American jobs since World War II,” said President Joe Biden as he presented the first part of the plan in Pittsburgh yesterday.
He claims that the investment in infrastructure will create millions of well-paid jobs.
The first part of the plan is called the “American Jobs Plan”. It is the one that will cost NOK 19.5 trillion at today’s exchange rate.
Part two is called “American Families Plan” and will be presented in a few weeks.
The gigantic government investments will breathe new life into American capitalism in a way that takes the environment into account.
The initiative is also part of Biden’s efforts to prevent China from becoming the world’s leading economic power.
This is how he wants to do it:
1: Modernize the infrastructure for transport
- Repair 10,000 bridges and replace the 10 most important bridges with new ones.
- Improve over 32,000 kilometers of road.
- Modernize and improve the railway, not least commuter routes. The state-owned company Amtrak will receive more than NOK 670 billion for much-needed upgrades. Even the “high-speed train” between New York and the capital Washington is shaking so it is difficult to hit with the “mouse” on a laptop.
- Build 500,000 charging stations for electric cars. Reduced taxes will make it attractive for American consumers to buy American cars that run on electricity or hydrogen. This should contribute to a «greener economy».
- Replace 50,000 diesel buses with electric buses. 20 percent of the yellow school buses will switch to electricity.
2: The infrastructure in the homes
- Build or renovate over 2 million homes for low- and middle-income families.
- All homes should have access to broadband, including those living in rural areas.
- Nearly NOK 1,000 billion will be invested in clean drinking water. All lead water pipes must be replaced. That means work for US plumbers, Biden said yesterday.
- Public schools and kindergartens will be upgraded. More schools are also to be built.
- The hospitals for war veterans must be modernized.
3: Industry, research and job training
- More than NOK 1,500 billion will be invested in research and development of green energy.
- Local communities that depend on the coal mines will be helped to create alternative jobs.
- Support for apprenticeships and job training for students, former prisoners and people from closed jobs.
- The state will contribute NOK 424 billion to the production of semiconductors or computer chips. China is trying to make itself independent of the United States by producing its own semiconductors for computers, mobile phones and innovation involving artificial intelligence. Computer chips are an important part of the economic “strategic competition” between the two countries.
Biden will also introduce new rules that protect workers who organize in trade unions.
4: Health and care
- Nearly NOK 3,400 billion will be spent on home help and care for the elderly and disabled in the local community.
- More than 800,000 Americans are on waiting lists for home help. Biden wants to shorten the waiting lists in Medicaid, the public program for low-income families and the disabled. At the same time, he will look at the salaries of those who work in this sector.
Some have to pay more taxes
President Biden said yesterday that no one who earns less than 400,000 dollars, or 3.4 million kroner, will pay more tax.
But business must contribute.
- Corporation tax is increased from 21 to 28 percent. Previously, it was at 35 percent, but Trump made a historically sharp reduction to stimulate the economy. Biden pointed out yesterday that it will still be “lower than in the entire period between World War II and 2017”.
- All subsidies and loopholes for the oil and gas industry are abolished.
- From now on, American companies must tax a minimum of 21 percent of income earned abroad. That is a doubling compared to the current level. It will be less profitable to move production out of the USA. Therefore, he will also remove the right to tax exemption for the first ten percent earned abroad.
In his speech in Pittsburgh yesterday, Biden pointed out that 91 of the 500 largest companies in the world do not pay “a single penny” in federal income tax. Among them is Amazon.
He compared it to a firefighter and a teacher. They pay 22 percent.
Reactions to the proposals for increased taxes came quickly.
– We are strongly opposed to the general tax increases that the administration has proposed. They want to slow down the economic recovery and make the United States less competitive globally, it is said in a statement from the United States Chamber of Commerce.
In Congress, there are several Democrats who share the concern about the tax increase.
Senator Joe Manchin (D) has previously advocated for 25 percent corporation tax. In March, he voted against a proposal from the Biden government to increase the minimum wage to $ 15 and may well vote against the administration again.
Even in the House of Representatives, Democrats cannot afford to lose more than three votes before the majority slips.
On the left in Biden’s party, several believe that the president’s plan is too modest.
– Must be much bigger, tweeted congressional representative Alexandria Ocasio-Cortez (D).
Republican Senate Leader Mitch McConnell said yesterday that he would not support increased taxes or deficit budgeting.
The majority leader in the Senate, Chuck Schumer (D), will be in full swing to assess whether the Democrats should try to get the plan adopted at express speed, through a so-called “settlement”.
Then it is not possible to debate a law for more than twenty hours. That is, the need to muster at least 60 out of 100 senators to end an endless debate, filibuster, falls away.
A simple majority is enough. Then the Democrats can do it.
But it is not ideal for a president to force through a decision on such an expensive plan.
President Biden still hopes for cross-party support.
He pointed out yesterday that large infrastructure projects have become a reality as a result of cross-party cooperation.
– It was Abraham Lincoln who built the transcontinental railway. Dwight Eisenhower, a Republican, built the nationwide system of highways, Biden said.
He promised to invite Republicans to the Oval Office to listen. He promised to be open to “other ideas”.
Then he pointed once again to China to remind what is at stake.
– You know, there are many autocrats in the world who believe that the reason they want to win is that democracies are no longer able to reach agreement. The autocracies can.
– This is a very basic question. Can democracies still deliver to the people?
Asked President Joe Biden.
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