OPINION

This isn't your ex-president's 'Infrastructure Week.' Biden plan is big, serious and paid for.

The American Jobs Plan is not just a response to past failures. It's essential for our national future. We cannot recover or grow or be safe without it.

Bernard L. Schwartz and David Rothkopf
Opinion contributors

President Joe Biden has just unveiled his $2 trillion “American Jobs Plan” and already there are major misconceptions circulating around it. Because this infrastructure program is so vital and so long overdue, it is important to get to the truth about it.

This is not like the joked-about ambitions of the previous administration’s many “infrastructure weeks.” In fact, although it provides for major new improvements to highways, mass transit, electric vehicle charging systems, water systems, the electric grid, research and development and key parts of our health system, it’s not just an infrastructure plan. 

As Biden made clear through the name he gave this initiative, it is at its core a jobs plan. In his Pittsburgh speech unveiling it, he said Wall Street economists have estimated the program could generate up to 18 million new jobs.

It is not however, just a jobs plan. It is also a growth plan. Investing in infrastructure increases productivity and attracts additional investment. Economists with S&P estimated that Biden's plans (including a $1 trillion American Families Plan he said he'd announce in a few weeks) could inject $5.7 trillion into the U.S. economy and raise per capita income by $2,400.

Canceling out GOP tax cuts 

The “American Jobs Plan” plan is very different from the big recent emergency relief packages we have seen, like the $1.9 trillion American Rescue Plan. It spreads outlays over eight years, so annual spending associated with the program is under $300 billion a year. An even more important difference is that Biden calls for his plan to be fully paid for with new tax revenues. He wants to raise corporate taxes to 28% from 21% and require companies to pay higher rates on earnings from overseas. He'd also end tax breaks for fossil fuel companies and intensify efforts to collect corporate taxes. Further, the cost of many of the projects themselves will be defrayed by revenues from those projects. 

Surprising no one, Senate Minority Leader Mitch McConnell has already warned the president not to turn the program into “a massive effort to raise taxes on businesses and individuals.” What he doesn't say is that the new tax revenue would largely replace the estimated $2 trillion the U.S. Treasury lost as a result of the GOP passed tax cuts for the rich program in 2017. He doesn’t want to acknowledge the $4.1 in additional debt he and Trump racked up even before the pandemic began. 

Biden, meanwhile, says he will pay for his plan and reduce debt over the long haul.

President Joe Biden says he wants to pay for his infrastructure plan by raising corporate taxes.

Focusing on the size of the investment is misleading when you consider the high cost of not making it. The president of the American Society of Civil Engineers has estimated that on average over the next 20 years, the cost of not fixing our infrastructure will amount to $3,300 per person. As Biden noted, every $5,000 spent to replace lead pipes in our water infrastructure produces savings of $22,000 in health care costs.

We know those costs well because we have neglected our infrastructure for so long.  The ASCE gives the nation’s overall infrastructure a C-minus grade. In 11 of the group's infrastructure categories the grade is a D or lower. Just bringing the infrastructure up to standards will cost $2.6 trillion. Currently, the United States is ranked 13th in the world in infrastructure — not where you need to be if you want to be competitive or attract international investment. 

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Dwight D. Eisenhower was the last president to push for a major infrastructure overhaul. When he championed a major investment in our interstate highway system, he also emphasized the vital national security role our infrastructure plays. Biden echoed this appeal by noting the vulnerability of the power and telecom grids in states like Texas and California revealed to us in recent months. 

Finding bipartisanship outside DC

Biden had long signaled that this package would focus on industries of tomorrow, like green energy, and play a vital role of U.S. efforts to combat climate change. Republicans are launching partisan attacks on this front, and making the same mistake they made in attacking the American Rescue Plan.

The president is trying in both cases to bypass inside-Washington toxicity and divisiveness and seek bipartisanship outside the Beltway. Upgrading infrastructure has broad public support, in some instances by overwhelming majorities that span the political spectrum.

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Much remains to be worked out.  As Biden indicated, the new plan will soon be followed by a related initiative to invest in our human infrastructure — also vital to job creation, growth, and our security. In addition, the details will have to be refined. We favor, for example, creating a national infrastructure bank to help ensure we prioritize the right deals, tap markets efficiently to leverage public money and spend wisely.  

But the key is this: We urgently need this plan. It will change the lives of each family supported by its new jobs and it is essential to creating a better future for all Americans. It is not just a response to our recent crisis or even the failures of the past half century. We cannot recover or grow or be safe without it.

Bernard L. Schwartz is the CEO of BLS Investments, former CEO of Loral Corp. and publisher of the quarterly "Democracy" journal. David Rothkopf (@djrothkopf) is host of "Deep State Radio," CEO of the Rothkopf Group media and podcasting company, and a member of USA TODAY's Board of Contributors. His latest book is "Traitor: A History of American Betrayal from Benedict Arnold to Donald Trump."