American Jobs Plan: V2, a compromise

This White House link takes you to the Fact Sheet for the bipartisan compromise of the American Jobs Plan. There you will see that this plan is still enormous, still containing two-thirds of the original resources dedicated to the “clean transportation infrastructure, clean water infrastructure, universal broadband infrastructure, clean power infrastructure, remediation of legacy pollution, and resilience to the changing climate”.

The framework lists 10 areas of concentration:

  • modernize and expand transit and rail networks across the country; the largest public investment in railroads since the creation of Amtrak;
  • repair and rebuild roads and bridges; the largest public investment in bridges since the construction of the interstate highway system;
  • creation of a national network of Electric Vehicle (EV) charging stations with a goal of 500,000;
  • electrification of thousands of school and transit buses;
  • replacement of thousands of miles of lead service and water supply lines;
  • connection of every American household to reliable high-speed internet; a scope not seen since the Rural Electrification Project 100 years ago;
  • upgrading the American power infrastructure by creating a Grid Authority bringing renewable energy sources online and creating new efficiencies in power transmission;
  • creating an Infrastructure Finance Authority leveraging billions of dollars for investment in clean energy projects;
  • addressing legacy pollution by investing billions of dollars in cleanup efforts that will, in turn employ millions in high-pay union jobs;
  • preparation of much of our infrastructure for the effects of climate change, extreme weather and protection from cyber attacks.

The V2 Plan details the spending in two categories; Transportation and Other Infrastructure. Transportation budgets $579B in 10 areas; Other budgets $266B in 6 areas. Financing the ambitious plan comes from 13 areas beginning with “reducing the IRS tax gap” and ending with “macro-economic impact of infrastructure spending”. There is also public-private partnerships, private activity bonds, a repurposing of unused unemployment compensation of the Rescue Plan, and many others. Noteworthy absent from the revenue sources is the increase in the corporate tax rate that was in V1. The macro-economic impact revenue source is interesting in that it is indirect but of significant possibility. This refers to the efficiencies of commerce that is created with new infrastructure. It anticipates an increase in the Gross National Product; i.e. the value of all goods and services sold in the country. Production of enormous additional goods and services adds wealth to the nation that, in part become government revenue It is to the Biden Administration’s credit that this compromise was created. It is now up to the Republican leadership in Congress to see it through.

Transforming America: The American Jobs Plan: Part 1

The American Jobs Plan will ambitiously “reimagine and rebuild a new economy”. Jim Hannley LLC is presenting a series of posts to highlight some parts of this plan as presented in this White House link. It will bring tens of millions of workers who are under employed or long term unemployed into the workforce by attracting them to jobs with high pay and benefits. Many of these workers have been discouraged from applying for jobs because they have not been employed in a very long time and/or believe that their skillsets and education make their prospects for employment very dim. Some of these are working but are not being paid. Part 1:

SOLIDIFY THE INFRASTRUCTURE OF OUR CARE ECONOMY BY CREATING JOBS AND RAISING WAGES AND BENEFITS FOR ESSENTIAL HOME CARE WORKERS

One very great objection Republicans have to the plan is the budgeted $400B to compensate American care givers “…toward expanding access to quality, affordable home- or community-based care for aging relatives and people with disabilities.” This link to the Caregiver Action Network shows that “…The value of the services family caregivers provide for “free,” when caring for older adults, is estimated to be $375 billion a year.” Some of the other statistics show that millions of children care for elderly in their homes; women make up the vast majority of care givers; that most care givers are employed outside the home and that (their) employers estimate that some $34B in productivity is lost annually due to this obligation of their employees.

Caregiver Action Network points out that the $375B value of this work is more than twice ($158B) what is currently spent on nursing home and homecare services. Not only are the estimated 65 million care givers providing an uncompensated service to society through their labor but in 2007 they also spent, out of pocket $5,531 (10% of their household income). Without the compassionate care America’s elderly and disabled people receive, typically in their own home, from family members, they would be dying sooner or living lives of lonely desperation. It is easy to imagine the added burden without this care that our hospitals and medical clinics would be bearing to address the resultant acute medical conditions of these people; likely at a cost to society of tens of billions of dollars.

Women care givers are more than 2.5 times as likely to live in poverty and five times as likely to be receiving Supplemental Security Income (SSI). Households that have at least one disabled member have 15% lower incomes than those without this burden. Logic dictates that this poverty is closely related if not a result of this burden. So, the billions of dollars of compensation that these care givers and those who will be employed in more formal care settings will significantly ramp up consumer demand; creating a snowball effect for secondary employment. Next: Part II, Roads and Bridges