How much of the Biden administration’s big infrastructure plan is about infrastructure?
Some Republican critics contend that hardly any of it is. “Only about 5% to 7% of it is roads and bridges and ports and things that you I would say is real infrastructure,” Russell Vought, President Trump’s director of the Office of Management and Budget, said recently. Is he right?
Like all humongous-scale legislative efforts, the Biden administration’s new $2.2 trillion infrastructure plan contains surprises—unrelated provisions that are hitching a ride on a juggernaut. In this case they’re not like barnacles on a giant ship. Some of these surprises are surprisingly large.
It’s worth remembering that while the media call the initiative an infrastructure plan, the Biden administration doesn’t. Officially, it’s the American Jobs Plan, and it consistently proposes creating or protecting jobs, especially union jobs. But the administration’s fullest description of the plan, a nearly 12,000-word fact sheet, leans heavily on infrastructure from the beginning. A close reading reveals just how much is really there.
Infrastructure as many people think of it—construction or improvement of bridges, highways, roads, ports, waterways, and airports—accounts for only $157 billion, or 7%, of the plan’s estimated cost. That’s apparently what Vought was referring to. The definition of infrastructure can reasonably be expanded to include upgrading wastewater and drinking water systems, expanding high-speed broadband Internet service to 100% of the nation, modernizing the electric grid, and improving infrastructure resilience. That brings the total to $518 billion, or 24% of the plan’s total cost.
Some of the plan’s remaining budget would be spent on what might be called “suprastructure”—not infrastructure, but rather things that use infrastructure. For example, the plan calls for building, preserving, or retrofitting more than 2 million homes. Another provision would subsidize and incentivize the production and purchase of American-made electric vehicles plus the installation of electric vehicle (EV) charging stations by state and local governments and private companies.
And then there are the plan’s elements that may or may not be worthy policy objectives but don’t claim any relationship to infrastructure. One of the plan’s largest programs, budgeted at $400 billion, would create jobs and raise pay for home care workers. Another of the most expensive programs, at $300 billion, would give targeted aid to manufacturers and small businesses across industries, regardless of any infrastructure connection. A program that immediately sparked controversy would budget $180 billion for public investment in technology and research and development including $50 billion for the National Science Foundation to establish a “technology directorate”—applauded by proponents of government-funded basic research, abhorred by critics of government efforts to pick winners. It’s a legitimate debate; it isn’t about infrastructure as that term is widely understood.
Other non-infrastructure elements of the plan would change laws in important ways without spending money. Most significantly, the plan would heavily increase corporate taxes, raising the basic tax rate from 21% to 28% while also reducing or eliminating deductions. In addition, the fact sheet says the plan “tackles inequities based on gender,” though it doesn’t say how. It would mostly require that all government projects use American-made goods that are shipped on U.S.-flag, U.S.-crewed vessels.
The grab bag of initiatives is not surprising, though it’s often overlooked by the general public. The $1.9-billion COVID-19 relief bill in February contained several below-the-radar COVID-free provisions—changing the way multinationals allocate interest costs and bailing out multi-employer pension plans, for example; two changes that had been in the works for years and had nothing to do with the pandemic.
But unlike the pandemic bill, the infrastructure plan doesn’t demand urgent action, so don’t expect any of it to become law soon. It hasn’t yet been transformed into a bill that the House and Senate can debate, and that eventual bill will be hundreds or thousands of pages. Getting to an up-or-down vote may take the rest of the year. Along the way it’s possible that some of the off-topic provisions could be pruned—and just as likely that others will be added.