The Daily - Inside the Biden Infrastructure Plan

Episode Date: April 2, 2021

President Biden is pushing the boundaries of how most Americans think of infrastructure.In a speech on Wednesday, he laid out his vision for revitalizing the nation’s infrastructure in broad, sweeping terms: evoking racial equality, climate change and support for the middle class.His multitrillion-dollar plan aims not only to repair roads and bridges, but also to bolster the nation’s competitiveness in things like 5G, semiconductors and human infrastructure.Today, we take a detailed look at what his plans entail and the congressional path he will have to navigate to get it passed.Guest: Jim Tankersley, a White House correspondent for The New York Times.Sign up here to get The Daily in your inbox each morning. And for an exclusive look at how the biggest stories on our show come together, subscribe to our newsletter. Background reading: President Biden began selling his infrastructure proposal on Wednesday, saying that it will fix 20,000 miles of roads and 10,000 bridges while also addressing climate change and racial inequities and raising corporate taxes.Here is how his $2 trillion in proposed spending on infrastructure breaks down.For more information on today’s episode, visit nytimes.com/thedaily. Transcripts of each episode will be made available by the next workday.

From The New York Times, I'm Michael Barbaro. This is The Daily. Today, President Biden is calling it an infrastructure bill. But as my colleague Jim Tankersley found, the multi-trillion dollar proposal is actually a blueprint for sweeping social and economic change. It's Friday, April 2nd. Two years ago, I began my campaign here in Pittsburgh, saying I was running to rebuild the backbone of America. And today, I return as your president to lay out the vision of how I believe we do that, rebuild the backbone of America. Jim, set the scene for us of this speech from President Biden.

So Joe Biden flies to Pittsburgh, you know, a blue-collar steel town, to give what is the first big sweeping structural economic policy speech of his presidency, what the White House is calling the American Jobs Plan. It's not a plan that tinkers around the edges. It's a once-in-a-generation investment. In the speech, he's introducing his giant infrastructure plan. Regardless your background, your color, your religion, no matter, everybody gets to come along. But he's doing it in really sweeping terms of racial equity and fighting climate change and boosting the middle class. It's big yes, it's bold yes. And we can get it done. Yeah, I was struck by how little he used the actual word infrastructure in that speech.

Yeah, he much more was focused on the concrete, and sorry for the pun, the concrete ways that the federal government spending money on roads, on bridges, on all these other things that he laid out would actually affect, you know, people's communities and lives and homes tangibly that they could see. And I think a big part of that is because Joe Biden is really pushing the boundaries here of what you and I or the American public might have thought of as infrastructure before this bill. So what exactly does infrastructure mean to Biden in the context of this legislation? Well, it actually means sort of three things, I think. We can break it down.

The first is kind of catching up for the country, fixing things that are physically broken, in need of repair, that are crucial to the way the economy works right now. The second is sort of competitiveness, kind of leaping ahead, making investments to help the country compete with other nations like China for the jobs and industries of the rest of the 21st century. And the third is a little bit squishier, but it's basically investing in people, the sort of humans who are in and of themselves infrastructure in the American economy, because they are our workers and the backbone of, you know, an economy that is very much based on services right now. So some of that human infrastructure is in this

package that the president announced in Pittsburgh, but a lot of it is coming in a second package, which the president says will be called the American Families Plan, and that'll come in the weeks to come. Okay, so let's explore these one by one, starting with the first category and definition of infrastructure, which is basically fixing physically broken stuff. What is the nature of the problem he's trying to solve here? What is the universe of broken stuff he's hoping this fixes? It's big. It just turns out the federal government has underinvested in the maintenance of our physical infrastructure for decades. And so we've got a lot of repaving to do is kind of a very shorthand way of looking at it. So Biden wants to modernize 20,000 miles of highways and roads.

Wow. He wants to repair 10,000 small bridges and then the 10 like most economically consequential bridges in the country that need repairs. Yeah. What is an economically consequential bridge look like? It's a bridge that is very important in connecting people and in particular commerce from sort of one side of a river to the other. We don't actually know what they will be. The White House hasn't said yet. But we do know that that's going to be

a sort of competitive list of communities saying, hey, we have an incredibly important bridge here that is vital to our economy. It needs repair. And so we want it done. So what else is physically going to be repaired? So airports, ports and waterways. And then I think this is a really important part of infrastructure that often gets overlooked, water pipes. You know, we have miles and miles in this country of water pipes that still have lead in them. And that's incredibly dangerous for children. There's no amount of lead in water that's safe for children. And the Biden plan would spend tens of billions of dollars just to replace every single lead-based water pipe in the

country. So a way to think about this is replacing or repairing the kind of unseen, and in some cases seen, guts of the American transportation and economic system. Yes, absolutely. And actually, even within this, again, very traditional way of thinking about infrastructure, there is a new sort of progressive liberal economist way of thinking that's been embedded in the Biden plan. And that's all about racial justice. They're going to target money in the Biden plan to a bunch of sort of left behind predominantly black or Hispanic or Native American communities that have suffered from past infrastructure decisions. So replacing those lead based water pipes is really going to help a lot of, you know,

black children in this country. In cities like Flint, the prevalence of lead in water supplies absolutely hurt black communities. And so there is a racial justice component just to getting clean drinking water to everyone, regardless of where you live. And there's a final racial element to this, which is that there's $20 billion in here for communities that were hurt by the previous expansion of the interstate highway system, like black communities in Syracuse or New Orleans that had freeways, they run right through their backyards. So like in Syracuse, New York, Interstate 81 ran straight through black neighborhoods that were bulldozed to put it up.

And it has left lingering racial disparities in that city's economy ever since. So what would the money in this bill do for a community like Syracuse? How will it actually be put to work? So what the administration says is that that money will create a new program, and I'm going to quote directly from what the administration put out this week, that will reconnect neighborhoods cut off by historic investments and ensure new projects increase opportunity, advance racial equity and environmental justice, and promote affordable access, which is a lot of really nice sounding things that we're going to have to see how that works in a plan. Right. For example, how do you reconnect a community that still has a highway

running through it? Right, exactly. Do you take down the highway? Do you move the highway? Do you build something new to bring that community more integrated into the regional economy that's grown up around the highway? These are going to be the debates, if this money is approved, that the administration is going to have to wade into. Okay, so that is the catching up element of infrastructure, the traditional meat and potatoes of fixing what's broken. Let's turn to what in this bill tackles the second definition of infrastructure, leaping ahead, making the U.S. economy smarter, more sophisticated, more competitive. Yeah, if we think about the repairs as kind of going in and strengthening what has been the backbone of the U.S. Yeah, if we think about the repairs as kind of going in and strengthening what has

been the backbone of the U.S. economy, we might think of this next group, which is hundreds of billions of dollars spending, as trying to build a new backbone for a new economy in the 21st century. The president really has a vision of an economy that competes, and it's very much about China, but other global competitors in a variety of industries that are sort of just now emerging. Things like 5G broadband or semiconductor manufacturing. There's overall a $300 billion investment in advanced manufacturing, which, you know, the president likes to say he's a union guy, but he sees union manufacturing jobs in the future being about, you know, electric powered cars and not

necessarily just about steel. And so there's $174 billion here for the electric car industry. Some of that's for manufacturing. Some of it's to build out the infrastructure you need to have electric cars all over the country, 500,000 charging stations for electric vehicles. So the spending in those areas are meant to almost be like a government effort to guide the development of the economy into places where Biden administration officials think the economy is going and where we're going to need to be more competitive with our rivals. And a huge part of this is they see all of those emerging industries, the future economy, tied in with the fight against climate change. There is no difference between the 21st century economy and a low-carbon economy in ways that they think will make American business more

competitive, but also sort of position the country for this future where everyone is transitioning away from fossil fuels around the world. So this definition of infrastructure is the government, not to mix metaphors, laying down the tracks with its own money for this future economy that is, for example, filled with electric cars and clean energy jobs based on the belief that industry won't get there fast enough in the U.S. on its own. So the government needs to nudge it forward. Yeah, I think we get to give it as it's both building the tracks to guide the economy to where it thinks it needs to be in the future and also increasing the fuel for the industries that are already there. So if you're a business in the clean energy space now, the administration wants you to be able to grow bigger, faster. And that's what a lot of the spending is going to, you know, in their mind, enable you to do.

of spending is going to, you know, in their mind, enable you to do. Finally, Jim, you mentioned this third category and definition of infrastructure, which is human infrastructure. So what do we know about that? So the idea here for the administration is to invest in the people who work in the economy and to give them the skills and the support they need to work as much as they can and earn as much as they can. And that means a bunch of different things. In the American Jobs Plan, what that means is a very specific group of workers are being invested in, home health care workers. So those are disproportionately black women,

and they are predominantly underpaid. They make about $12 an hour as a group, but they do really important work helping older Americans and the disabled who need care in their homes. And there's a backlog. There's not enough of that care. So the plan would spend $400 billion to increase the amount of that care and to pay those workers much better to make it not a poverty level job anymore. So that's the big thing in the American Jobs Plan. But remember, there's another large package of stuff coming in a couple of weeks, the American Family Plan. And that's going to have a bunch of this type of thing in

it as well. We don't know all the details yet, but I've done a lot of reporting on what is likely to be in it. And it includes things like investing in education, both in early childhood with universal pre-kindergarten and in higher education. So everyone being able to go to community college for free. It means a national paid leave program and efforts to make childcare much more affordable, both of which are targeted at women being able to work more. So those are all efforts kind of together to boost these groups of workers who are critical to our economy, but for one reason or another, are not able to perform to their full potential because of policy holding them back.

So Jim, just to zoom way out, this plan to invest in infrastructure is a plan to invest in the traditional highways, bridges, roads, pipes. But in reality, taken all together from what you've just said, this is a massive society-wide plan for pretty self-consciously progressive change in many quarters of the economy that's being called infrastructure. Absolutely. And that is why it is immediately running into a lot of resistance from Republicans in Congress. They're calling it a liberal wish list. They're calling it a Trojan horse. And they're zeroing in, in part, on these racial justice and climate change initiatives embedded in the bill to basically say, hey, this is not infrastructure as we understand it. They're putting out pie charts saying only a small

fraction of this is traditional infrastructure. So this is the debate that Joe Biden is going to have to have if he wants to approve the plan. And it's going to happen over the next several months. We'll be right back. So Jim, you just talked about the fight ahead for Biden in Congress to get this giant infrastructure program through. And I suppose one of those fights is going to be over how to pay for both of these, the American Jobs Plan and the American Families Plan. So how is Biden going to pay for them? Well, first and foremost, he says he's going to pay for it, as opposed to just borrowing the money and running up the budget deficit like he did with his relief bill earlier this year. And while we don't know all the details

for the American Family Plan, we do have the White House's details on how they're going to pay for the American Jobs Plan. And the basic gist of it is they're going to raise a lot of taxes on corporate America, particularly multinational corporations. And the way the White House runs the numbers is this. The spending in the bill would play out over about eight years. Over about 15 years, the tax increases would pay back that spending. Now, that's almost twice as long, but it does pay for that spending. Okay, walk us through that. Sure. The first thing they're going to do is increase the corporate income tax rate. President Trump, you might remember, did a big corporate income tax cut,

cut it from 35% down to 21%. Biden would take it back up, not all the way, but to 28%. So that's the start. Then he would force multinational companies to pay more in tax to the United States on income they earn around the world in an attempt to sort of end this practice that a lot of companies have of moving profits around the globe in order to search for lower tax rates. I believe, Jim, it's a well-known fact that large corporations have really good lobbyists and that I suspect they are opposing this increase in the corporate tax rate and efforts to make international companies pay more to the U.S. Definitely. Every big business group in Washington

is out with a statement opposing these tax increases. Many of them say, hey, we support what the president's trying to do here on infrastructure, but we need to find a different way to pay for it. And they're going to put a lot of pressure, not just on Republicans, who are pretty uniformly opposed to raising taxes on business, but on moderate Democrats to try to stop this from being the pay for for an infrastructure bill. And what would be their argument to those lawmakers? They make two big arguments.

The first is, hey, now is a terrible time to raise taxes on business. You're trying to make the economy more competitive with an infrastructure bill. But if you raise taxes, you're going to make our companies less competitive because they're paying more tax than the rest of the world. The second argument they're making is that the people who benefit from infrastructure should pay for that infrastructure. So user fees, like if you're going to make a highway better, the people who drive on the highway, whether they're families going to soccer practice or long-haul truckers delivering goods across the country, they should pay for those improvements basically through higher gas taxes or a vehicle miles travel tax.

Huh. Is there legitimacy to these concerns and to these counter proposals? There are all sorts of economists all over the map who would tell you different things about the pay-fors, but there's general consensus, I think, among economists that user fees often are very good ways to raise money for infrastructure. There is a huge divergence, I think, in the policy community in Washington, really along ideological lines, about how bad it would be to raise corporate taxes right now. Conservatives really argued that, hey, the rest of the world has been cutting corporate tax rates for a while. And if we go in the other direction, we're going to make it very unattractive to locate businesses here compared to, you know, Ireland or anywhere else around the world with a lower tax rate. Whereas liberal economists say, listen, the Trump tax cuts,

which were an attempt to boost that sort of competitiveness, did not produce the huge boom in investment in the United States that we were promised. And they did not stop the practice of companies moving, you know, money to Bermuda to avoid taxes. So going back on that's not going to make things worse. Got it. Jim, you started to hint at this, but my sense is that there is universal opposition to this program from congressional Republicans, which leaves us with a question of exactly how Biden is supposed to get this through and just how much support he even has from Democrats. Well, first, we know what the president himself said this week in his speech, which was he's going to keep up the pressure on

Republicans. He sees them as, hey, this is a party that's been saying for years and years and years, we want to do infrastructure. So while none of them have come out in support of his plan yet, he has a real hope that he's articulating, at least, that if he invites enough of them to the White House, if they talk enough about the details, they could maybe come to some sort of agreement. And in particular, he has challenged them, if you don't like the tax increases, Republicans, that I've proposed, please suggest your own pay-fors. You just have one rule. You can't raise taxes on people making less than $400,000 a year. Interesting. And have they come forth with any plans? There have been some Republicans who have talked about some plans. For example, Senator Mitt Romney of Utah has talked about a carbon tax. But there have not

been comprehensive Republican plans offered. And that is a bit the sort of White House gambit here. Put the onus on the Republicans to come forward with their own plan and then strike a deal if they do. And if they don't, they have a backup, which is they try to pass it on a party line vote through the House and the Senate through this special process known as budget reconciliation, which only requires 50 votes as opposed to the 60 you need to get past a Senate filibuster. And so if they can keep every single Democrat on board and clear a bunch of procedural hurdles that that process throws at you, then they could once again ram a very large bill through the Congress without a single Republican vote, just like they did with the last economic bill, the president's relief bill. And is your sense that all 50 Democrats would be willing to do that with a bill of this scale? What we know is that all of the Democrats in the House and the Senate are on record sort of saying they want to do a big infrastructure package. They disagree on some details. There's going to be a lot of negotiation. There's a lot of progressives pushing for an even bigger plan than Biden has done now. And then there are some moderates who want maybe different pay-fors

or maybe different structure. It's going to take months for them to work this out. But very importantly for the White House, the party wants to do a big bill, which is a big change, I think, from past Democratic caucuses in the Senate. And so it's just really a question of, can they get the details right to hold every single vote they need? Mm-hmm. So based on what you're saying, there's a relatively high chance

that some form of this bill will be adopted in the coming months. I would call it, yeah, a decently high chance that they could pass some kind of big infrastructure bill in the coming months. I don't think we have any great idea yet what that might look like, whether it's very close to what the president just announced or whether it's, you know, much farther off than it evolves in all of these negotiations.

Jim, what would it mean for Biden to get this society-altering, multi-trillion-dollar infrastructure plan passed into law after the multi-trillion dollar stimulus bill, which was itself pretty sweeping in its attempt to remake the social safety net for adults and for children. We've talked about that bill on the show. What would it signal if he was able to get those done back to back? It would be easily the most sweeping, sprawling, however you want to call it, expensive set of government initiatives passed since the Great Society in the 1960s, and in dollar terms could end up being the largest expansion of federal spending ever. And in that

sense, it would put Joe Biden in league with past really ambitious Democratic presidents to expand government. Lyndon Johnson, you know, Franklin Roosevelt. He, I think, sees, and certainly the people around him see the possibility of that sort of a legacy, and they're trying to do it all within this man of his first year. Mm-hmm. But he will have done it in a single-party fashion, which, since you mentioned Lyndon Bain Johnson, is not what he

did. LBJ's programs were defined by support from both parties. Both of these bills from President Biden are almost exclusively supported by Democrats. Biden does very much want to have a bipartisan legacy, and I think he would much prefer to do a bipartisan infrastructure bill, for sure. But politics are different today than they were under LBJ or FDR, and I think that that's important to note. It's just a more polarized political party environment. You don't have, you know, liberal Republicans and conservative Southern Democrats who routinely cross the aisle anymore to vote for each other's plans. And in this case, what the real accomplishment would be politically for Biden would be holding the relatively conservative still senators from Arizona and West Virginia in his own party on the same bill as like AOC and the very progressive Democrats in the House.

So if he can do that, that would be, I think, a different sort of legislative feat than Johnson pulled off, but a difficult one nonetheless. Thank you, Jim. We appreciate it. Thank you. We'll be right back. Here's what else you need to know today. I walked up to the individual. Noticed he wasn't moving. I didn't see any chest rise or fall on this individual. And when you approached, he said he was in handcuffs. As you

approached him to inspect further, were the officers still on top of him? The officers were still on him when I approached. On the fourth day in the murder trial of Derek Chauvin, a paramedic who arrived on the scene testified that Chauvin remained on top of George Floyd, despite visible evidence that Floyd appeared to be dying. And what did his condition appear to be to you overall? In lay terms, I thought he was dead. The paramedic, Derek Smith, said police officers could have tried to revive Floyd with chest compressions before paramedics had arrived, but did not. And the

leaders of several major corporations based in Georgia, including Coca-Cola and Delta Airlines, have publicly denounced the state's new election law, a sweeping measure backed by the state's Republican lawmakers that restricts access to voting. Let me be crystal clear and unequivocal. This legislation is unacceptable. It is a step backwards and it does not promote principles we have stood for in Georgia. Their statements appeared to be a response to a letter signed by dozens of prominent Black executives this week, calling on fellow corporate leaders to fight a wave of restrictive voting bills being advanced by Republicans in more than 40 states.

In response, Georgia's Republican governor, Brian Kemp, accused Coca-Cola and Delta of caving to pressure from what he called, quote, partisan activists. Today's episode was produced by Stella Tan, Rachel Quester, Asta Chaturvedi, and Alexandra Lee Young. It was edited by M.J. Davis-Lynn and Dave Shaw, and engineered by Brad Fisher. That's it for The Daily. I'm Michael Barbaro. See you on Monday.