Opinion by Jeffrey D. Sachs | CNN.com
March 31, 2021
Editor's Note: Jeffrey Sachs is a professor and director of the Center for Sustainable Development at Columbia University and president of the United Nations Sustainable Development Solutions Network. His most recent book is "The Ages of Globalization" (Columbia University Press, 2020). The opinions expressed in this commentary are those of the author; view more opinion on CNN
(CNN) - President Joe Biden has delivered on his promise to follow his Covid relief bill with a long-term recovery plan. His new American Jobs Plan is a comprehensive, well-targeted and timely approach to America's many long-term economic ills, responding powerfully to 40 years of federal neglect.
Many conservatives will object, but their relentless naysaying has been the primary reason for America's growing crises of inequality, precarious work and environmental disasters.
Biden's plan is built around the idea of sustainable development: an economy that is prosperous, fair and environmentally conscious. It does so by funding upgrades to education, advances in digital technology, renewable energy and our transportation infrastructure. And the plan goes back to the basics -- echoing the boldness of past federal projects as varied as the Tennessee Valley Authority, the federal interstate highway system and the creation of the internet.
The breadth of the Biden infrastructure program is impressive and well designed, including electrified transport, safe drinking water and high-speed broadband for all Americans. These investments are combined with modernizing homes, commercial buildings, schools, hospitals and federal buildings.
The plan includes two additional pillars: research and development funding to put the US back in the lead on cutting-edge green and digital technologies; and a nationwide industrial policy to ensure that all parts of the nation share in the green and digital boom. In short, this is a jobs program for all regions, not just for today's high-tech coasts.
The logic of such an ambitious plan is simple -- public investment in these critical areas of growth will help build a more prosperous, equitable and greener future. And yet, despite this reality, the federal government has failed to pass a massive infrastructure package on this scale for decades.
The main reason? A combination of financial oligarchy and racism. These two political forces may seem disconnected, but they are not. Tax cuts and small government have served both the wealthiest Americans and the racists who rejected the federal enforcement of 1960s civil rights legislation in areas ranging from environmental justice to quality education for all. Together, they've been part of the base of the Republican Party since the 1980 election of former President Ronald Reagan.
Biden and a majority of Americans get this point, in part because former President Donald Trump made it so vivid in his four years of corporate tax cuts, despoilation of the environment, brazen neglect of crumbling infrastructure (despite his repeated promises to the contrary), attacks on public education and, of course, his loathsome racism.
The Biden plan aims to spend an additional 1% of GDP per year over the next eight years -- a total of roughly $2 trillion -- to be paid for by long-overdue taxation on corporate America, comprised of the country's leading financial oligarchs. The list of proposed tax measures is so obvious, so basic and so right, that it's a wonder how corporate America has evaded them for so long.
In the Biden proposal, the corporate tax rate would be raised from 21%, set by the 2017 Trump tax cuts, to 28% percent. Crucially, the plan also commits the Biden administration to work with other countries to implement corporate minimum taxes everywhere, and to prevent companies with management and operations in the US from artificially declaring their tax residence in a tax haven. These steps are bolstered by the promise to restore tax enforcement by the IRS, after years of dire IRS underfunding that led the agency to cut back sharply on corporate audits.
It's no accident that Biden launched the plan today in Pittsburgh. Western Pennsylvania straddles the old declining economy of fossil-fuel-based industry and the rising 21st Century economy of artificial intelligence, robotics, low-carbon steel and renewable energy -- with major innovations coming out of Pittsburgh's top universities and its leading local companies.
As the White House has explained, currently "half the jobs in our high growth, high wage sectors are concentrated in just 41 counties" -- out of over 3,100 counties in the country. The Biden plan will fundamentally change that arithmetic, by creating a new "social infrastructure to support innovation and productivity across the nation."
This is a plan for all Americans in all parts of the country. The time has come to build America's future.