President Biden Unveils Sweeping $2 Trillion Infrastructure Plan

April 16, 2021

On Wednesday, President Biden unveiled the first installment of his two-part Build Back Better plan – a sweeping $2.25 trillion infrastructure proposal billed as the American Jobs Plan. 

In addition to fixing highways, bridges and roads, which accounts for approximately 5% of the plan ( $620 billion), the measure calls for a myriad of administration policy priorities outside of traditional transportation and broadband projects aimed at climate change, reducing use of fossil fuels, supply chain issues, research funding, community care services and targeting racial inequities.

Of particular interest for the life sciences industry is an effort to address future pandemics, providing $30 billion over four years to make major investments in medical countermeasures manufacturing, research and development, and related biopreparedness and biodiversity. Some of the research funding will be reserved for black colleges and universities.

The spending would unfold over eight years, largely paid for in 15 years by hiking the corporate tax from 21% to 28%. Other tax code changes include increasing the global minimum tax on U.S. corporations to 21% from 13% and increasing IRS audits of corporations. 

Passage of the Biden infrastructure plan is already facing headwinds from progressive Democrats who don’t think it goes far enough and moderate Democrats who are concerned about the plan’s size and scope. For Republicans, increasing taxes could be a non-starter. Any final proposal – even if Democrats choose to use Reconciliation and go it alone – will likely reflect a process of negotiation.

The Biden administration is also planning a second major package, which could cost upward of $1 trillion, that it will unveil in April. That measure, which will likely be funded by tax increases on wealthy Americans, is expected to focus on domestic issues, such as expanding health care, providing universal kindergarten, extending the child tax credit and offering paid family leave.

The second installment, the American Families Plan, which could cost upward of $1 trillion, could come as early as mid-April. It’s likely to focus on soft infrastructure investments in child care, universal kindergarten, family tax credits and other domestic programs, paid for by higher taxes on the wealthy. Sen. Bernie Sanders (VT) has indicated he wants to lower the Medicare age from 65-60 and pay for it by lowering drug prices through Medicare negotiations. 

Key elements of the infrastructure bill include:

• $620 billion: Roads, bridges, airports, ports
• $300 billion: Housing infrastructure
• $300 billion: U.S. manufacturing
• $400 billion: Clean energy initiatives
• $174 billion to invest in electric vehicles
• $400 billion: Care for elderly and disabled

The plan is said to include the House-passed  Protecting the Right to Organize (PRO) Act, which awaits Senate action. Among other things, the bill would weaken right-to-work laws in 27 states. Utah is currently a right-to-work state. The Coalition for a Democratic Workplace, representing more than 600 industry organizations, including the U.S. Chamber of Commerce, has expressed strong concerns about this legislation, which they say would significantly restructure U.S. labor laws.