Friday 25 June 2021 7:38 am

Biden turns on the investment taps with $1.2 trillion bill agreement

The US Senate has finally agreed on a $1.2 trillion infrastructure bill, which was watered down some $1.1 trillion from Biden’s original pitch.

The deal, worth an eyewatering £860bn, accompanies an eight-year plan to fund roads, bridges, the power grid, public transport and the internet.

However, left-wing Democrats have called the deal ‘paltry’ after Biden failed to secure funding for green reforms and social programmes.

The investments are long overdue, Biden said, adding that the package would create “millions” of jobs.

“We’re in a race with China and the rest of the world for the 21st Century,” he continued, adding: “This agreement signals to the world that we can function, deliver and do significant things.”

How will it be spent?

The US’ roads and bridges will be supported by a boost of $109bn, railways will get $66bn, $49bn for public transport and $25bn for airports, according to a White House statement.

An additional $73bn will be pumped into the power grid and $65bn for making broadband internet more accessible to rural Americans.

How will it be paid for?

The trillion-dollar bill is meant to be paid for with unused coronavirus aid money and returned state jobless benefits.

The plan will also not raise taxes on middle-income Americans, nor reverse the cuts to business taxes that were passed during the Trump presidency, according to reports.

Democrats have also urged the bill’s proposed $40bn investment in the Internal Revenue Service would generate a net gain of $100bn in extra tax revenue.

What about green investment?

Biden wants to include investments for green initiatives in another bill, which would be worth around $6 trillion.

The $6 trillion bill, being drafted by senator Bernie Sanders, will seek to invest in his party’s priorities on climate change, education, paid leave and childcare benefits.

The newer bill, which has not yet been agreed upon, is expected to include tax hikes on the wealthy and corporations.