President Joe Biden’s nearly $2.3 trillion American Jobs Plan, unveiled on March 31, 2021, proposes a multitrillion-dollar infrastructure and jobs investment over eight years, paid for with what the administration calls a “Made in America Corporate Tax Reform Plan” over the next decade and a half.
The biggest chunk, $1.3 trillion, would go toward infrastructure spending on two fronts: transportation and community. The balance, more than $980 billion, would involve investments in research and development (R&D), workforce development, manufacturing, and eldercare.
What follows is a breakdown of proposed spending before negotiations between Republicans and Democrats begin in earnest.
As proposed, the American Jobs Plan:
- Involves a nearly $2.3 trillion, 8-year investment paid for with increased corporate taxes over 15 years.
- Is expected to create millions of prevailing-wage jobs.
- Invests $1.3 trillion on a combination of community and transportation infrastructure spending to build, repair, and upgrade highways; provide affordable housing; build new schools; and more.
- Allocates $580 billion for research and development, workforce development, and manufacturing.
- Includes $400 billion to support home- and community-based care for the elderly and disabled.
An Expanded View of Infrastructure
The American Jobs Plan combines many of the same elements contained in previous infrastructure projects with some newer elements not found in past proposals.
Early in the nation’s history, infrastructure projects were designed to build riverways, roads, and canals. Later came railroads, telephone systems, electric lines, and natural gas pipelines. More recent proposals have included the Internet and interstate banking.
The Biden plan features similar traditional infrastructure components, including roads, waterways, and airports, but adds much that is new, including long-term care, a ban on exclusionary housing, and investments in community-based anti-violence programs. These additions have already raised objections from some who think the American Jobs Plan is more policy than spending proposal.
Spending by Category
The American Jobs Plan proposes a heavy investment in traditional transportation infrastructure along with a whole series of less traditional community infrastructure projects. The table below provides a snapshot of areas covered by Biden’s proposal.
|Transportation Infrastructure||$621 B|
|Highways, bridges, roads||$115 B|
|Public transit||$85 B|
|Electric vehicles||$174 B|
|Airports, water transit||$42 B|
|Transportation inequities||$45 B|
|Other misc. programs||$30 B|
|Community Infrastructure||$689 B|
|Clean drinking water||$111 B|
|Schools and VA hospitals||$137 B|
|Other misc. programs||$28 B|
|R&D, Workforce, Manufacturing||$580 B|
|Research & development||$180 B|
|Workforce development||$100 B|
|Home/community-based care||$400 B|
Source: Fact Sheet: The American Jobs Plan
Transportation Infrastructure $621 Billion
The president’s plan would spend $115 billion on highways, bridges and roads, including 20,000 miles of roadway and the worst 10,000 bridges.
He’s proposing $85 billion to modernize public transit, an investment that’s twice what the federal government spends now.
An additional $80 billion would go toward Amtrak’s repair backlog.
The plan would establish $174 billion in grants and other incentives to encourage state and local governments to partner with the private sector to build a national network of 500,000 electric vehicle (EV) chargers by 2030. Up to 50,000 diesel transit vehicles would be converted to electric, along with the entire U.S. Postal Service fleet and at least 20% of the nation’s school buses.
The plan also hopes to invest a total of $42 billion in airports, terminals, inland waterways, shipping ports, and the country’s freight system.
What the administration calls “historic inequities” in transportation infrastructure would see a $45 billion investment to reconnect neighborhoods, sponsor new projects, and inspire research into things like safe transportation systems.
Another $50 billion would go toward improving infrastructure resilience to protect against fires, floods, and other acts of nature.
Community Infrastructure $689 Billion
The plan proposes a $111 billion investment in clean drinking water, with $45 billion used to replace lead pipes and service lines. Other upgrades would include wastewater and stormwater systems, tackling contaminants in water systems, and providing reliable water infrastructure in rural areas.
A proposal to cover 100% of the country with high-speed broadband service would cost $100 billion if fully enacted. The administration hopes to use this investment to promote transparency and competition among Internet providers.
Another $100 billion would be spent to update the country’s electric grid. The administration points to blackouts in Texas this past winter to highlight the need for this investment. The funds would be used to build high-voltage transmission lines, offer tax credits to those who adopt renewable power and carbon capture projects, and plug abandoned oil and gas wells and abandoned mines.
Biden’s proposal would invest $213 billion in housing and other buildings, including the building and retrofitting of two million homes to improve public housing. The project would also include building and modernizing schools, childcare centers, community colleges, and VA hospitals. The White House promotes the plan as a way to mobilize union trade workers and provide jobs. This proposal would also eliminate exclusionary zoning laws that the administration says inflate housing and construction costs.
R&D, Manufacturing, Workforce Development $580 Billion
The R&D portion of this section of the proposal, $180 billion, includes a major clean-energy effort to reduce emissions, boost climate research, and build climate-related resilience into infrastructure. The plan would also seek to eliminate racial and gender inequalities in R&D.
On the manufacturing front, a total of $300 billion of the American Jobs Plan would be invested in semiconductor manufacturing, medical manufacturing, clean energy, small businesses in rural communities, and regional innovation hubs to support community-led projects.
Legislatively, the president is asking Congress to allocate $46 billion of the manufacturing total for federal purchases of EVs, charging ports, and electric heat pumps to help boost the clean-energy industry.
About $100 billion would be used for workforce development concentrated in low-income and underserved communities. The money would be used to help dislocated workers and put students on career paths for good-paying jobs before they graduate from high school.
Eldercare $400 Billion
The $400 billion that Biden hopes to spend on caregiving infrastructure would be invested in home- and community-based care for older people and those with disabilities. Some of the funds would be used to extend Medicaid’s “Money Follows the Person” program that allows people in nursing homes to move back to their own homes. The plan also calls for improved working conditions and higher wages for caretakers, many of whom are women of color.
Paying for the American Jobs Plan
The American Jobs Plan, as laid out by the administration, pledges $2.29 trillion in new spending over eight years to accomplish its stated goals.
Payment would come from a “Made in America Tax Plan” that the planners estimate “will raise over $2 trillion over the next 15 years,” consisting of the following taxes on corporations through:
- Resetting the corporate tax rate to 28% (currently 21%).
- Increasing the global minimum tax that multinational corporations must pay to 21%.
- Providing incentives for companies to have U.S.-based production and manufacturing.
- Ending tax breaks for fossil fuel companies.
- Ramping up tax enforcement of U.S. corporations that invert or claim tax havens.
- Levying a 15% minimum tax on book income reported to investors.
Whitehouse.gov. "FACT SHEET: The American Jobs Plan." Accessed April 1, 2021.
OSU.edu. "How Public and Private Enterprise Have Built American Infrastructure." Accessed April 1, 2021.