Build Back Better Plan

President Biden speaks about the American Job Plan in Pittsburgh in March 2021

On March 31, 2021,[13] Biden unveiled details of his $2.3 trillion American Jobs Plan (which, when combined with the American Families Plan, amounted to $4 trillion in infrastructure spending),[14] pitched by him as "a transformative effort to overhaul the nation's economy".[15] The plan aimed to create millions of jobs, bolster labor unions, expand labor protections, and address climate change.[16][17]

The plan called for $621 billion of spending on transportation infrastructure. This includes $115 billion towards highways and roads, $80 billion to improve American railways, $85 billion to modernize public transportation, $25 billion towards airports, $174 billion to incentivize adoption of electric vehicles (including $15 billion for the construction of 500,000 electric vehicle charging stations by 2030), and $17 billion for inland waterways, coastal ports, land ports of entry and ferries.[13] It also calls for electrifying at least 20 percent of the country's yellow school bus fleet.[13]

The plan called for $100 billion in funding for American energy infrastructure, aiming to transition the country to 100% carbon-free electricity production by 2035. It intends to establish a "Grid Deployment Authority" within the Department of Energy to support the construction of high-voltage transmission lines.[3]

The plan included $213 billion for building and retrofitting more than 2 million homes and $40 billion to improve public housing.[13] It would also seek to end exclusionary zoning.[17] The plan included $111 billion for modernizing drinking water, wastewater, and storm water systems. $45 billion of this is intended to replace 100% of the lead water piping in the country.[3] The plan aimed to deliver universal high-speed broadband coverage.[13]

The AJP proposed a $16 billion investment in plugging "orphan wells", abandoned wells that continually release methane emissions.[18] The plan contained $100 billion to construct and upgrade public schools, $25 billion to upgrade childcare facilities, and $12 billion to spend on community colleges.[13]

The AJP contained a proposal for a Civilian Climate Corps modeled loosely after the Civilian Conservation Corps (CCC) created during the New Deal.[19][lower-alpha 1] The plan proposes that $10 billion be allocated for the program, which the White House has stated would create somewhere between 10,000 and 20,000 jobs.[18] In contrast, during its nine years in operation, around three million people participated in the original CCC.[23]

The plan would spend $180 billion on research and development, including substantial expenditures in clean energy and basic climate research.[13] It would also spend $50 billion on semiconductor technology.[13] The plan set aside $300 billion for manufacturing expenditures.[3]

The plan included $400 billion to expand access to home- or community-based care for seniors and people with disabilities.[13]

The passage of the proposed Protecting the Right to Organize Act (PRO Act) was included as part of the proposal.[24] The legislation would bolster unions by overriding state right-to-work laws[25][26] and safeguarding union elections.[27]

The source of funding was planned to come from raising the corporate tax rate as a part of a proposed "Made in America Tax Plan".[3] This would partially reverse the 2017 tax reforms that occurred under the Trump administration. The corporate tax rate would rise from 21% to 28%, bringing it closer to the pre-reform tax rate of 35%. The tax plan would aim to raise over $2 trillion by 2036,[17] with other methods including ending subsidies for fossil fuel companies, increasing the global minimum tax from roughly 13 percent to 21 percent, and deficit spending.[13][28]

Also planned was an increase of the global intangible low-taxed income (GILTI) from 10.5% to 21%.[29] GILTI taxes target intangible assets like patents, copyright, and trademarks that can sometimes be used by companies for tax avoidance.[30] This tax was created in 2017 to discourage U.S.-based companies from shifting profits to corporate tax havens.[30]

On July 28, Senate negotiators announced that a $1.2 trillion agreement for physical infrastructure had been reached.[31] According to NPR.org, this included:

• "$110 billion for roads, bridges and other major projects;
• $11 billion in transportation safety programs;
• $39 billion in transit modernization and improved accessibility;
• $66 billion in rail;
• $7.5 billion to build a national network of electric vehicle chargers;
• $73 billion in power infrastructure and clean energy transmission" and
• $65 billion for broadband development.[31]

The bill also made the Minority Business Development Agency a permanent agency.[32] The Senate voted to advance the bill by a count of 69–31 on August 10.[33][34] On November 5, the House of Representatives passed it 228–206.[35] Biden signed the legislation into law on November 15.[36]

The Center for American Progress (CAP), a liberal think tank, lauded the original AJP for its focus on climate justice.[37] The program also received support from organized labor, with AFL–CIO president Richard Trumka praising the plan for its inclusion of the PRO Act.[38] Senator Bernie Sanders spoke favorably of the plan while arguing that the White House should go even further.[39]

Political conservatives dismissed the original legislation as costly and challenged the description of policy areas traditionally not included in the realm of "infrastructure" being part of the plan.[40] Republican Senator Ted Cruz criticized the plan, arguing that it would lead to job losses and served as a "Green New Deal-lite masquerading as an infrastructure plan".[41] Republican House minority leader Kevin McCarthy called the plan "[m]ajor expansions of government agencies and even more inflation that will lead to higher costs for all Americans."[42]

The third part of the original Build Back Better agenda, the American Families Plan, set aside $1 trillion in new spending and $800 billion in tax credits (both over ten years).[43] This included:

• $200 billion in spending on childcare, ensuring that no family has to pay more than 7% of their income on childcare,
• ~$200 billion to make pre-kindergarten universally available for free,
• >$200 billion towards government-subsidized paid family and medical leave,[44]
• ~$300 billion towards making community college free for all Americans, and
• ~$200 billion on health insurance subsidies available through the Affordable Care Act healthcare exchanges.[45][43][46]

It would have extended the boost to the child tax credit made in the American Rescue Plan, which effectively turned the credit into a child allowance.[47][48] It would also revoke a federal restriction on people with felony drug convictions from obtaining food benefits through the Supplemental Nutrition Assistance Program (SNAP).[49]

The bill was to have been at least partially funded by a number of tax hikes on high-income Americans and investors,[45] including restoring the top marginal income tax rate to its pre-2017 level of 39.6% and nearly doubling the capital gains tax for people earning more than $1 million, as well as eliminating a provision in the tax code that reduces capital gains on some inherited assets, like vacation homes.[43] It would also raise revenue by boosting the budget of the Internal Revenue Service by $80 billion (distributed over ten years), which the White House estimates could raise over $700 billion in revenue that otherwise would have been lost to tax evasion.[50][51] It would also require the banks to report total account outflows and inflows to the IRS to help detect tax evasion.[52]

A $3.5 trillion reconciliation bill that included measures related to climate change, family aid, and expansions to Medicare was rolled out, but it failed to win the support of Republicans or moderate Democrats.[53][54] On October 28, the White House released a new $1.75 trillion framework, but it still struggled to win the support of Democratic Senator Joe Manchin to use the reconciliation process.[55] After it ultimately failed to match his envisioned cost, Manchin publicly rejected the bill, dooming its passage.[6]

A Data for Progress poll conducted in late June 2021 for Invest in America found that 62% of likely voters support passing both the American Families Plan and AJP together using reconciliation. Among Democrats, 86% supported the use of reconciliation, as did 59% of Independents and 36% of Republicans.[56]