Biden plan would pick winners, losers in move to green jobs
Some companies are looking to President Joe Biden’s giant infrastructure proposal to help transform the automotive sector as electric vehicles shift from a luxury niche to mainstream America
May 17, 2021, 7:44 PM
6 min read
President Joe Biden arrives to speak about distribution of COVID-19 vaccines, in the East Room of the White House, Monday, May 17, 2021, in Washington. (AP Photo/Evan Vucci)
WASHINGTON -- In Georgia, school bus-maker Blue Bird has visions of going from selling a few hundred electric buses annually to 15,000. In Michigan, Ford plans to produce an all-electric version of its F-150 pickup truck.
Both companies are looking to President Joe Biden's $2.3 trillion infrastructure proposal to help transform the automotive sector as electric vehicles shift from a luxury niche to mainstream America. The plan reflects an effort by Biden to accelerate certain sectors of the economy with the belief they'll become the engines for growth in the decades to come.
“You need someone to give you a real jumpstart,” Blue Bird CEO Phil Horlock said. “This is actually changing the landscape.”
Biden will visit Ford's electric vehicle plant in Dearborn, Michigan, on Tuesday, returning to an industrial state that contributed to his election victory and is the center of an auto sector that'll likely need some government help to move away from gas guzzlers.
The Democratic president wants the government to accept the risk of investing in a series of industries such as electric vehicles and semiconductors that he believes will become the backbone of the U.S. economy. It's a sharp philosophical divide from Republican lawmakers who would rather the federal government focus more on the steel, concrete and asphalt of conventional infrastructure projects.
“He has an industrial policy -- which we’ve always had but never admitted,” said Brett Smith, director of technology at the Center for Automotive Research. “Our industrial policy had been that low-cost energy wins. He’s shifting that to carbon-free energy is the industrial policy.”
Biden said in a speech last week that his proposed new tranche of government spending is required to keep the U.S. economy competitive and fair on top of the coronavirus relief that's already flowing. Besides infrastructure, Biden is asking for another $1.8 trillion — putting the combined total spending at roughly $4 trillion — to devote to education and families.
Biden said his infrastructure plan is “an eight-year investment strategy to make sure working people of this country get to share in the benefits of a rising economy and to put us in a position to win the competition with China and the rest of the world for the 21st century."
The infrastructure package would be paid for by higher corporate taxes. Leading business groups such as the Business Roundtable and U.S. Chamber of Commerce have opposed raising the corporate rate from 21% to 28%. But some of the companies that could benefit directly from the spending appear willing to make that trade, and that complicates the politics of the moment because there are clear winners and clear losers, such as the fossil fuel sector.
Biden is openly saying government dollars should seed new opportunities for businesses. It's an effort to steer where private investors direct their money and a response to other nations like China that have backed favored industries such as electrical vehicles and semiconductors that could threaten America's own preeminence.
A White House official said that some businesses briefed on the infrastructure proposal have also seen it as having the qualities of an industrial policy in which government works in concert with companies.
One element of Biden's plan that draws companies' attention is the $50 billion proposed for the Commerce Department to monitor U.S. manufacturing capacity and fund investments to support production of critical goods. The official, who spoke on the condition of anonymity to reveal internal discussions, said companies interpret it as a new way of thinking about supply chains when supplies of computer chips, lumber and other goods are squeezed.
