President Joe Biden will start rolling out an ambitious plan this week to upgrade America’s infrastructure, fight climate change and improve safety-net programs. It comes after years of failed attempts in Washington to come together around much-needed investments in everything from roads and bridges to water systems and high-speed broadband.
For Biden, the forthcoming infrastructure and budget proposals showcase Democrats’ broader desire to rethink the role of the federal government over the course of his presidency.
While some economists worry that infrastructure spending, on top of the $1.9 trillion American Rescue Plan Act, will overheat the economy and lead to inflation, others argue inflation poses less risk than letting millions of people languish in an economy that still isn’t working for people on its bottom rungs. The Washington Post’s Rachel Siegel reports:
The leisure and hospitality sector — which largely employs people of color and women — is down almost 3.5 million jobs, or roughly 20 percent of its pre-pandemic level. Workers who had been in the bottom 25 percent of earners faced an unemployment rate of around 22 percent in February, compared with the overall rate of 6.2 percent, according to a speech last week by Federal Reserve Governor Lael Brainard. Economists say many of the 9.5 million jobs still missing from the labor market will gradually return. But it’s unclear how long it will take, and which jobs will vanish forever in the meantime. Businesses are increasingly looking to technology and automation to cut the cost of labor, compounding the risks of long-term unemployment for some of the country’s most vulnerable workers.
Unlike the $1.9 trillion stimulus law, the infrastructure investments will be paid for, at least in part, by raising taxes. The Wall Street Journal’s Richard Rubin and Andrew Duehrin look at one particularly egregious loophole that lawmakers hope to close:
Under current law, someone who dies with appreciated assets—including homes, businesses and stocks in taxable accounts—doesn’t have to pay capital-gains taxes on that increase. Instead, the heirs have to pay capital-gains taxes only after they sell and only on gains after the original owner’s death. That “stepped-up basis” is a longstanding feature of the tax code, but it has come under increasing attacks from Democrats who see wealthy people’s profits escaping the income tax.
To grow Louisiana’s economy, invest in its people
Earlier this month, in what has become a depressing rite of spring, U.S. News and World Report released its annual “Best States” index and Louisiana was once again at the bottom. Louisiana fares poorly on a broad range of indicators, including population health, education and infrastructure. Columnist Bob Marshall writes in The Times-Picayune | Baton Rouge Advocate, that Louisiana also leads the nation in industrial toxins, and wonders whether that ignominious distinction makes it harder for the state to attract the types of companies and jobs that rely on human talent.
But then you think about competing with other industries for the best and brightest employees. So you also begin looking at those USNWR rankings, and others. You look at Louisiana’s scores at or near the bottom in literacy, education, poverty, general health, infant mortality, total pollution, life expectancy, crime and incarceration. So then you start looking elsewhere. Unless you’re in a pollution-heavy industry. Then you look at the state’s history of giving huge tax exemptions for polluters — especially foreign-owned companies — and asking very little in return in terms of permanent employment.
Vaccination rates lag in rural Louisiana
All Louisiana residents 16 and older are now eligible for a Covid-19 vaccination. But the state’s efforts to achieve herd immunity against the deadly virus have hit a snag, as vaccine supply now exceeds demand in some parts of the state and certain populations are reluctant to accept the inoculation that could save their life. But rural residents also face barriers that don’t exist in urban areas. The Times-Picayune | Baton Rouge Advocate’s Sam Karlin explains:
Hesitancy among Black residents was pinpointed early on as an obstacle in the effort to vaccinate a large share of Louisianans, though some data shows those attitudes are changing. Now, polling and interviews with experts and residents suggest that hesitancy in rural areas, especially among White residents in conservative strongholds, is a bigger culprit in holding back the state’s ability to reach herd immunity. But it’s not only attitudes about the vaccine. Rural areas also have far fewer health care sites than cities like New Orleans and Baton Rouge. An hour-long drive to get a shot is a big ask of residents, experts say, and many rural folks say they prefer the one-shot Johnson & Johnson vaccine as a result. Internet access — which can be crucial in scheduling an appointment — is spotty in much of rural Louisiana.
The health toll of the pandemic
Since the start of the Covid-19 pandemic, millions of Americans have delayed or forgone needed medical care. Survey data has found that more than 1 in 4 adults have recently avoided health care, and 20% did not get medical care they needed for something other than Covid. The trend holds true across income levels, but is especially prevalent among low-income households and those seeking mental health care. Gideon Lukens of the Center on Budget and Policy Priorities reports that the American Rescue Plan Act includes several provisions designed to help:
It expands health insurance coverage and makes it more affordable by reducing or eliminating insurance premiums for plans in the Affordable Care Act (ACA) marketplaces, and it incentivizes states that have not yet adopted the ACA’s Medicaid expansion to do so. It invests in community mental and behavioral health services for adults and children, including support for mobile crisis intervention services. Finally, it helps tens of millions of people through expanded unemployment benefits, more food and housing assistance, tax credit expansions, emergency funds, and other provisions.
Number of the Day
70.6 – Percentage of Black people in their “prime” working years – age 25 to 54 – in the workforce, which is 7.2 percentage points below the employment-to-population ratio for whites (77.8%). Some economists say this shows the economy has plenty of room to grow and add new workers without overheating. (Source: The Washington Post)