Better roads, more public EV chargers? We're on board with that.
It has taken President Biden just two months to put together a bill to rival Roosevelt's New Deal. After guessing what would be included, and seeing the letter sent to Biden from the UAW, we now have a clear picture of what this bill will mean if it's passed. Spoiler alert: it doesn't ban the sale of gasoline vehicles.
First, the details. Biden's plan, which he revealed in Pittsburg yesterday, is "about making an investment in America - not just modernizing our roads or railways or bridges but building an infrastructure of the future," according to press secretary Jen Psaki.
The $2.25 trillion package's largest chunk consists of $621 million for roads, bridges, public transit, electric vehicle charging stations, and other transportation infrastructure. As we know anecdotally, our roads and bridges aren't great. Since the American Recovery and Reinvestment Act in 2009, the bridges have improved. Now only a single-digit percentage of bridges are rated as "structurally deficient." The roads, however, peaked in 2011, and now a large majority are in poor or mediocre condition.
Sewers and broadband for the masses is also on the docket, for $111 billion and $100 billion, respectively. We're interested in the $100 billion for upgrading the power grid to deliver cleaner electricity. Homes could get retrofitted; schools will get modernized.
The first $2 trillion will come from a hike on corporate taxes, "that would raise the necessary sum over 15 years and then reduce the deficit going forward," according to the White House. That includes going back to the 28% rate from the 21% percent rate that was set in 2017. It also has a new global minimum tax of 21%, which would help keep companies from shifting profits overseas to save taxes.
For the record, Psaki noted that almost 20% of Fortune 500 companies pay zero dollars in taxes. That includes Netflix, Amazon, Chevron, Delta Airlines, General Motors, Halliburton, and others.
The benefits to the regular folk like us are manifold. Besides keeping the economic growth going after the Covid relief bill, infrastructure deals like this reduce shipping times and commutes, public health is improved and the added construction jobs boost consumer spending.
You can also expect fewer repairs for tires and suspension, especially in areas like Detroit; more public chargers and a smarter grid will increase the adoption of EVs. And that's good for enthusiasts because as the corporate average fuel economy (CAFE) limit rises, automakers have to balance their fleets. If Chevy sells a million Bolt EUVs that don't use any fossil fuels, it can sell more Corvettes that use a ton of them.