This article provides the latest on the various Biden Stimulus or Spending plans put forward in 2021. Jump to the relevant one via the links below
2021 Bipartisan Infrastructure Package
The US Senate has now passed a $1.2 trillion infrastructure package – called the Infrastructure Investment and Jobs Act (IIJA) – by a wide bipartisan majority vote of 69-30. This bill will provide funding to upgrade the nation’s crumbling infrastructure with funding for priorities like roads, bridges, rail, transit and the electric grid. Here are the key areas funded:
- 110 billion in roads, bridges and major work projects
- $66 billion in passenger and freight rail
- $65 billion to rebuild the electric grid
- $65 billion to expand broadband internet access
- $39 billion to modernize and expand transit systems
- $7.5 billion to build a national network of charging infrastructure for electric vehicles
- $55 billion for water infrastructure of which $15 billion of which will be directed toward replacing lead pipes
More updates to follow as the bill now goes to the House for final passage. It is then expected to go to the President by the end of September for signature.
2021 American Jobs Plan For Infrastructure and Money For Middle Class Families
The Biden administration has released its next major spending plan, dubbed the American Jobs Plan, which is a $1.8 trillion spending package consisting of the following spending measures:
- Fix 30,000 miles of highways, rebuild bridges, upgrade ports, airports and transit systems. ($621 billion)
- Deliver clean drinking water, a renewed electric grid, and high-speed broadband to all Americans.
- Build, preserve, and retrofit more than two million homes and commercial buildings, modernize our nation’s schools and child care facilities, and upgrade veterans’ hospitals and federal buildings.
- Solidify the infrastructure of our care economy by creating jobs and raising wages and benefits for essential home care workers.
- Revitalize manufacturing, secure U.S. supply chains, invest in R&D, and train Americans for the jobs of the future.
- Create good-quality jobs that pay prevailing wages in safe and healthy workplaces while ensuring workers have a free and fair choice to organize, join a union, and bargain collectively with their employers.
Make our infrastructure more resilient:
The President is calling for $50 billion in dedicated investments to improve infrastructure resilience to safeguard critical infrastructure and services, and defend vulnerable communities and maximize the resilience of land and water resources to protect communities and the environment.
Ensure clean, safe drinking water is a right in all communities by spending $111 billon to replace 100 percent of the nation’s lead pipes and service lines.
Revitalize America’s digital infrastructure with an investment of $100 billion. That investment will:
- Build high-speed broadband infrastructure to reach 100 percent coverage.
- Promote transparency and competition.
- Reduce the cost of broadband internet service and promote more widespread adoption.
Reenergize America’s power infrastructure with a $100 billion investment to cover the following:
- Build a more resilient electric transmission system
- Spur jobs modernizing power generation and delivering clean electricity to support moving toward 100 percent carbon-pollution free power by 2035.
- Put the energy industry to work plugging orphan oil and gas wells and cleaning up abandoned mines.
- Remediate and redevelop idle real property, and spur the buildout of critical physical, social, and civic infrastructure in distressed and disadvantaged communities.
- Mobilize the next generation of conservation and resilience workers.
$213 billon to Build, preserve, and retrofit more than two million homes and commercial buildings to address the affordable housing crisis in America. The President’s plan will help address the growing cost of rent and create jobs that pay prevailing wages, including through project labor agreements with a free and fair choice to join a union and bargain collectively.
- Produce, preserve, and retrofit more than a million affordable, resilient, accessible, energy efficient, and electrified housing units.
- Build and rehabilitate more than 500,000 homes for low- and middle-income homebuyers.
- Eliminate exclusionary zoning and harmful land use policies.
- Address longstanding public housing capital needs.
- Put union building trade workers to work upgrading homes and businesses to save families money.
Modernize schools and early learning facilities
- Modernize our public schools. The President’s plan invests $100 billion to upgrade and build new public schools, through $50 billion in direct grants and an additional $50 billion leveraged through bonds.
- Investing in community college infrastructure. Invest $12 billion to address these needs. States will be responsible for using the dollars to address both existing physical and technological infrastructure needs at community colleges and identifying strategies to address access to community college in education deserts.
- Upgrade child care facilities and build new supply in high need areas. Provide $25 billion to help upgrade child care facilities and increase the supply of child care in areas that need it most. Funding would be provided through a Child Care Growth and Innovation Fund for states to build a supply of infant and toddler care in high-need areas. President Biden also is calling for an expanded tax credit to encourage businesses to build child care facilities at places of work. Employers will receive 50 percent of the first $1 million of construction costs per facility so that employees can enjoy the peace of mind and convenience that comes with on-site child care.
Invest in R&D and the technologies of the future: President Biden believes America must get back to investing in the researchers, laboratories, and universities across our nation. But this time, we must do so with a commitment to lifting up workers and regions who were left out of past investments. He is calling on Congress to make an $180 billion investment that will.
Retool and revitalize American manufacturers and small businesses
President Biden is calling on Congress to invest $300 billion in order to:
- Strengthen manufacturing supply chains for critical goods by investing $50 billion in semiconductor manufacturing and research, as called for in the bipartisan CHIPS Act.
- Protect Americans from future pandemics. This funding provides $30 billion over 4 years to create U.S. jobs and prevent the severe job losses caused by pandemics through major new investments in medical countermeasures manufacturing; research and development; and related biopreparedness and biosecurity.
- Jumpstart clean energy manufacturing through federal procurement to enable the manufacture of those cars, ports, pumps, and clean materials, as well as critical technologies like advanced nuclear reactors and fuel, here at home through a $46 billion investment in federal buying power, creating good-paying jobs and reinvigorating local economies, especially in rural areas.
- Make it in ALL of America. Invest $14 billion in NIST to bring together industry, academia, and government to advance technologies and capabilities critical to future competitiveness.
- Increase access to capital for domestic manufacturers.
- Create a national network of small business incubators and innovation hubs.
- Partner with rural and Tribal communities to create jobs and economic growth in rural America.
Made in America Tax (MAT) Plan
The President’s American Jobs Plan will invest about $2 trillion this decade. If passed alongside President Biden’s Made in America corporate tax plan, it will be fully paid for within the next 15 years and reduce deficits in the years after.
The MAT plan is aimed at fixing the corporate tax code so that it incentivizes job creation and investment here in the United States, stops unfair and wasteful profit shifting to tax havens, and ensures that large corporations are paying their fair share. Together these corporate tax changes will raise over $2 trillion over the next 15 years and more than pay for the mostly one-time investments in the American Jobs Plan and then reduce deficits on a permanent basis
- Set the Corporate Tax Rate at 28 percent. The President’s tax plan will ensure that corporations pay their fair share of taxes by increasing the corporate tax rate to 28 percent. His plan will return corporate tax revenue as a share of the economy to around its 21st century average from before the 2017 tax law and well below where it stood before the 1980s. This will help fund critical investments in infrastructure, clean energy, R&D, and more to maintain the competitiveness of the United States and grow the economy.
- Discourage Offshoring by Strengthening the Global Minimum Tax for U.S. Multinational Corporations. The President’s tax reform proposal will increase the minimum tax on U.S. corporations to 21 percent and calculate it on a country-by-country basis so it hits profits in tax havens. It will also eliminate the rule that allows U.S. companies to pay zero taxes on the first 10 percent of return when they locate investments in foreign countries. By creating incentives for investment here in the United States, we can reward companies that help to grow the U.S. economy and create a more level playing field between domestic companies and multinationals.
- Enact A Minimum Tax on Large Corporations’ Book Income. The President’s tax reform will also ensure that large, profitable corporations cannot exploit loopholes in the tax code to get by without paying U.S. corporate taxes. A 15 percent minimum tax on the income corporations use to report their profits to investors—known as “book income”—will backstop the tax plan’s other ambitious reforms and apply only to the very largest corporations.
- Ramping Up Enforcement Against Corporations. A decade ago, essentially all large corporations were audited annually by the IRS; today, audit rates are less than 50 percent. This plan will reverse these trends, and make sure that the Internal Revenue Service has the resources it needs to effectively enforce the tax laws against corporations. This will be paired with a broader enforcement initiative to be announced in the coming weeks that will address tax evasion among corporations and high-income Americans.
See the personal tax changes that the Biden proposal wants to implement to further offset spending.
Biden 2021 American Rescue Plan
President Joe Biden’s $1.9 trillion stimulus proposal called the American Rescue Plan (ARP) has now been passed into law as of March 11, 2021. Two cornerstones of the Biden stimulus ARP package fulfill campaign promises around additional economic impact payments (a.k.a stimulus checks) and extended unemployment benefits until Labor day. Democrats are aiming to get the final Biden stimulus bill passed and signed into law before March 14th, 2021, the date when the current stimulus funding (under the CAA COVID relief bill) for enhanced unemployment benefits expire.
Third Round of Stimulus Checks
Direct economic impact payments of $1,400 to single adult making less than $75,000 and couples earning less than $150,000. The $1400 payment will bringing the total relief in 2021 to $2,000 when including the $600 payments made in January. This third round of stimulus checks will also include another round of $1400 dependent payments and expand eligibility to a broader range of dependents.
Unemployment Benefit Insurance Extensions and Extra Payments
There are provisions for extending COVID related enhanced unemployment benefit programs like Pandemic Unemployment Assistance (PUA) to the end of August 2021. The final bill kept the supplementary weekly unemployment benefit (FPUC) at $300 and pays it for an extra 25 weeks. You can see this article for a graphical representation of the latest extension and coverage period of all the enhanced unemployment programs to date.
The ARP also provides additional unemployment income tax breaks for those households earning less than $150,000 whereby the first $10,200 worth of benefit payments would be tax-free in 2020.
A Biden administration would also maximize work-sharing, a form of “employment insurance” to keep more workers on the job by subsidizing employers to keep employee’s on their payroll.
Student Loan Forgiveness
Forgive a minimum of $10,000 per person of federal student loans of offset impacts of COVID related economic losses to impacted students and their families
Increasing Minimum Wage
Increasing the federal minimum wage to $15 per hour, this would be a 20 to 40% jump in many states. Some like California and Washington are already at this level. However this provision was scrapped in the Senate and will NOT be in the final bill.
Housing Aid, Foreclosure and Eviction
Extending the eviction and foreclosure moratoriums until the end of September 2021. There is also roughly $20 billion of aid to help low-income households cover back rent, rent assistance and utility bills. Around $10 billion has been authorized to help struggling homeowners pay their mortgages, utilities and property taxes. $5 billion has also been provided to help states and localities assist those at risk of experiencing homelessness and another $5 billion for emergency housing vouchers for those who are homeless.
Health Care Relief
Provisions have been added to provide relief for many Americans to save on private health Insurance if they are out of a job, and on COBRA benefit from their employer or getting insurance via Obamacare (Affordable Care Act) through a health exchange. The government would pay the entire COBRA premium from April 1 through Sept. 30. Those who bought health insurance via a government exchange would also get relief through lower premiums that would cost no more than 8.5% of their income (MAGI). See more in this article.
Food Stamps/SNAP Program Extension
The final stimulus plan includes extending the currently approved 15% increase in monthly Supplemental Nutrition Assistance Program (SNAP) benefits to the end of September 2021. The plan also covers a $3 billion investment in Special Supplemental Nutrition Program for Women, Infants, and Children (WIC).
Expansion to the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC)
The proposal also includes expanding the current CTC to $3,000 annually per child (or $250 monthly) between the ages of 6 and 17, while increasing it to $3,600 for children under the age of 6 (infants), equivalent to $300 monthly. The IRS will make these payments on a monthly basis versus eligible recipients having to claim the credit via their tax return on an annual basis. A similar increase is also proposed to the Earned Income Tax Credit (EITC).
There are hundreds of billions of dollars of funding for COVID testing/vaccination, small business, local and state governments in the bill which I will cover in another article soon.