The Biden administration’s $ 2.3 trillion American jobs plan promises a revival of the nation’s infrastructure. But an infrastructure program will increase productivity and future wealth. That is, it should focus on investment, not current consumption. In the long run, such a program would use federal funding to support aggregate demand, giving entrepreneurs more confidence in private investment.
The US Employment Plan doesn’t do this. Worse, if passed, it would actually make future efforts to invest in the nation’s infrastructure more difficult.
The proposed Biden plan only spends $ 115 billion on roads and bridges – much less than the $ 400 billion it would spend on long-term care for the elderly and the disabled. Even taking into account infrastructure, 180 billion dollars for research and development of the plan, the program spent more on consumption than for investment.