Big Tech and Corporate Tax Cuts: The Goals of Joe Biden’s Urgent Economic Plans | US News

If current trends continue and Joe Biden enters the White House on January 20, he will arguably face the greatest set of challenges a president has had to face since the end of World War II. The coronavirus hits the United States, millions of Americans continue to lose their jobs every month and the climate crisis, ignored by the Trump administration, is worsening.

Biden has set his economic and political plans, but without the Senate’s control he may have a hard time making them come true. Official third-quarter GDP figures showed that the size of the economy was still nearly 4% below its previous peak despite a 7.4% recovery since the spring lockdown.

At present, it seems certain that the Democrats will control the House of Representatives, but we will have to wait for the results of the special elections in Georgia before we know who controls the Senate. A Republican majority would block many of his proposals.

Like Donald Trump, Biden can use executive orders, basically presidential decrees, to circumnavigate political obstacles. While those orders would have important consequences, Biden will likely have a difficult time passing major legislation without Democratic control of both branches of Congress.

But these are some of the key elements of Bidenomics:

Stimulus package

The United States economy is still recovering from the impact of the coronavirus pandemic. But after an initial bipartisan bailout, additional aid stalled before the election. Biden hopes to implement an emergency action plan to save the economy in the first days of his presidency.

He intends to use wartime legislation known as the Defense Production Act (DPA) to force American companies to make personal protective equipment (PPE), medical supplies, ventilators, and anything else that the US does. They need to cope with the pandemic. The DPA gives the president broad powers to compel a company to come to the aid of the country.

Biden has also put in place plans to increase unemployment insurance, send more direct payments to struggling Americans, forgive some student loans, and provide more help to small businesses.

But, and it’s a big but, Biden will likely need Republican support for a major stimulus package. And after racking up the largest budget deficit in Trump’s history, Republicans have started talking about the need to balance the books once again.

Last month, the Congressional Budget Office estimated that the U.S. deficit reached $ 3.13 trillion in its 2020 fiscal year, which ended on September 30. As a percentage of the overall economy, the deficit is at its highest level since shortly after World War II.

New ‘green’ deal

Climate change is the “number one problem facing humanity,” Biden said last month and his administration has ambitious plans to tackle a crisis that the Trump administration has downplayed and ridiculed. Their plans include:

• Ensuring that the US achieves a 100% clean energy economy by 2035 and reaches net zero emissions by 2050.

• Refurbishing US infrastructure to ensure buildings, water, transportation, and energy infrastructure can withstand the impacts of climate change.

• Rejoin the Paris agreement on climate change and bring world leaders together to tackle the problem.

• Address polluters and others whose actions have disproportionately affected low-income communities and people of color.

His climate and environmental justice proposals require $ 1.7 trillion in federal investment over the next 10 years. The plans don’t go as far as the “Green New Deal” advocated by Representative Alexandria Ocasio-Cortez and other progressives – fracking, for example, would continue until alternative fuels can replace it – but they still represent a total repudiation of the Trump era. . policies.

Corporate taxes

Trump’s $ 1.5 trillion tax cut, passed in the first months of his presidency, stands as his greatest legislative achievement. Condemned as a giveaway to wealthy and corporate interests, it was also highly unpopular and was rarely mentioned by Trump during his re-election campaign.

Biden has vowed to undo much of Trump’s plan. Among his proposals, Biden would be:

• Increase the corporate tax rate to 28%, from 21%.

• Impose a minimum tax on all foreign profits of US companies located abroad in an attempt to stop the use of foreign tax havens.

• Penalize companies that send jobs abroad.

• Raise the maximum individual income rate back to 39.6% and force those who earn more than $ 1 million a year to pay the same rate of investment income that they pay for their wages.

• Only raise taxes for those who earn more than $ 400,000 a year.

Rapper 50 Cent attacked Biden’s plans before the election, but polls show widespread support for higher taxes for the very wealthy.

Once again, Republicans, even as they start to worry about deficits again, are likely to side with 50 Cent.

Technological repression

Big tech did very well with Trump’s tax cuts even before the pandemic moved the economy further online. But his dominance has angered politicians on both sides of the aisle, for different reasons, and addressing the industry can be an area where Biden can count on the support of all parties.

Both parties have blamed social media for spreading misinformation. Trump has threatened to repeal section 230 of the Communications Decency Act, which protects social media companies from lawsuits over the content they host. Biden has also criticized the law, but has yet to outline how he would reform it.

But the biggest technological challenge will likely come from the courts rather than the White House. Alphabet, Google’s parent company, is now fighting an antitrust lawsuit filed by the Justice Department that accuses the company of abusing its domain in search and search advertising to maintain an illegal monopoly. The Federal Trade Commission is also considering an antitrust lawsuit against Facebook. Meanwhile, US attorneys general are lining up their own cases against big technology.

While the cases will take years to conclude, what they discover could well give Biden the political capital he needs to push for better legislation to tackle monopolies in the digital age.

Trade wars

Anger over how decades of free trade policies had emptied US manufacturing propelled Trump to the White House in 2016. And while “Uncle Joe” will undoubtedly be a less divisive figure on the world stage than Trump, no one is anticipated. return to free trade. your schedule.

Biden voted for the North American Free Trade Agreement in the Senate in 1994, a vote his presidential rival used to throw in his face. “Michigan lost half of its auto jobs thanks to Biden’s NAFTA and the China disasters,” Trump told a crowd in Michigan days before the election.

It is a legacy that you have fought hard to undo. “We will not buy anything that is not made in America,” Biden told CNN in September after his campaign outlined a $ 700 billion “Buy American Products” plan that would increase government spending on goods, services and research. produced in the United States.

Biden’s affable style may mean negotiations are more civil, but trade disputes will continue. It has already warned that the UK will not reach a trade deal with the US if Brexit threatens Northern Ireland’s Good Friday deal.

Trade disputes are likely to continue with China as well. The end of globalism may be one of the most enduring legacies of the Trump era.