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Ethics & Religion
Column #2,071
April 19, 2021
Infrastructure Proposal Flawed
By Mike McManus

Biden's proposed $2.3 trillion infrastructure bill is welcome, but seriously flawed.

What the President calls "The American Jobs Plan" proposes a relatively small share for infrastructure: $521 billion. Certainly, there is a need for that investment. Rail tunnels under the Hudson are more than a century old. It would invest $115 billion to revamp highways and roads including 10 major and 10,000 smaller bridges in need of reconstruction.

Also needed is an $85 billion investment to modernize existing transit systems and $80 billion to fix Amtrack's repair backlog. It is also sensible to invest $174 billion to build a national network of 500,000 electric-vehicle chargers by 2030. There are also sensible proposals of $25 billion to upgrade airports and $17 billion for inland waterways.

These reasonable proposals account for about half of the proposed $2.3 trillion cost.

There are also sensible proposals to invest $213 billion to build and retrofit more than 2 million homes for the poor and $40 billion to improve public housing. It is also wise to invest $111 billion for clean drinking water, $5 billion to replace lead pipes which would reduce lead exposure in 400,000 schools and child-care facilities. Also reasonable is $100 billion of upgrade and build new public schools and $12 billion to invest in community college infrastructure and $25 billion to upgrade child-care facilities.

President Biden correctly declared: "It's a once-in-a-generation investment in America unlike anything we've seen or done since we built the interstate highway system."

However, the proposal also includes $400 billion to expand access to home or community-based care for seniors. What has that got to do with infrastructure? Also questionable is higher wages and benefits for caretakers of the elderly.

Another questionable element is $580 billion for research and development to reduce emissions and boost climate-focused research.

That's about $1 trillion for possibly worthy outlays, but have nothing to do with infrastructure development.

Another questionable element of Biden's proposal is that it is supposed financed by increasing the corporate tax rate from 21 percent to 28 percent. Trump reduced the corporate tax rate from 35 percent to 21 percent at the end of 2017.

However, it is unwise to pay for eight years of spending with 15 years of taxes. Either Biden should have raised the corporate tax back to what it had been earlier. Or better, he should have raised taxed on the super wealthy - those earning $400,000 or more - who had them cut by Trump by nearly a trillion dollars.

"Paying for eight years of spending with 15 years of taxes is a classic Washington gimmick that always end up proving to not work," charges Brian Riedl, a top budget advisor to the GOP presidential campaign of Sen. Mitt Romney.

Or the President should have reduced his package to infrastructure-only elements. Nearly 20 percent of the bill goes toward expanding care giving for the elderly and disabled by building more care centers and expanding access to home-based care. Another 13 percent goes toward boosting the U.S. manufacturing sector with large investments in semiconductors and green energy.

Those investments aren't typically seen as traditional infrastructure but align with the administration's focus on caregiving and reviving U.S. manufacturing.

Clearly, Biden is generally expanding spending across-the-board, while incorrectly calling it infrastructure.

The federal deficit in 2020 alone was $3 trillion. That was due, in part to the collapsed economy because of the COVID-19 crisis. Fortunately, the nation's economy is now reviving. But the deficit in 2021 is likely to be in the range of $1 trillion to $2 trillion, without any new spending such as the infrastructure proposal.

This is not a time to add to the deficit with Biden's eye-popping $2.3 trillion infrastructure bill - much of which has nothing to do with infrastructure.

Therefore, I propose that American Jobs Plan be cut back to the most essential infrastructure investments of perhaps $1.5 trillion.

Furthermore, it should be totally paid for by higher taxes on wealthy individuals and corporations within the 8 years of spending.


Copyright (c)2021 Michael J. McManus, a syndicated columnist and past president of Marriage Savers. To read past columns, go to Hit Search for any topic.


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