companies scramble for workers, prices rise and supply chains struggle to keep pace with booming demand, this is the wrong moment to hit the economy with any added juice.

“We don’t have a lot of spare capacity,” said Kristin J. Forbes, an economist at the Massachusetts Institute of Technology. “We certainly don’t have a lot of spare workers today.”

Inflation looms more significantly in the near term because it is currently high, and if it remains that way for an extended period, consumers could change their behaviors and expectations, locking in faster gains. People who worry about the proposals say that 2022 is the wrong time to hand households more money.

Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, said she was unsure whether the package would fuel inflation. But given the current pace of price increases, “you have to be more careful than you would be otherwise.”

The White House says the provisions of the bill that put money in families’ pockets, such as child care help, are not simple stimulus. They will allow caregivers into the labor market, they argue, an investment in the economy’s future that will allow it to produce more with time.

That makes the new program different from the spending passed earlier this year. The Biden administration increasingly acknowledges that sending households checks and offering expanded unemployment insurance supplemented savings, and that as households had more wherewithal to spend it helped to drive up prices.

Mr. Biden said in Baltimore on Wednesday. But the White House contends that this program is not the same as the previous package, and that it will make the price situation better, not worse.

“According to the economic experts, this bill is going to ease inflationary pressures,” the president said on Wednesday.

Still, the 17 Nobel Prize-winning economists that the White House regularly cites have specified that capacity improvements will ease inflation over time rather than imminently.

“Because this agenda invests in long-term economic capacity and will enhance the ability of more Americans to participate productively in the economy,” they wrote, “it will ease longer-term inflationary pressures.”

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Biden’s Proposals Aim to Give Sturdier Support to the Middle Class

Skeptics have warned of government overreach and the risk that deficit spending could ignite inflation, but Mr. Biden and his team of economic advisers have, nonetheless, embraced the approach.

“It’s time to grow the economy from the bottom and middle out,” Mr. Biden said in his speech to a joint session of Congress last week, a reference to the idea that prosperity doesn’t trickle down from the wealthy, but flows out of a well-educated and well-paid middle class.

He underscored the point by singling out workers as the dynamo powering the middle class.

“Wall Street didn’t build this country,” he said. “The middle class built the country. And unions built the middle class.”

Of course, the economy that lifted millions of postwar families into the middle class differed sharply from the current one. Manufacturing, construction and mining jobs, previously viewed as the backbone of the labor force, dwindled — as did the labor unions that aggressively fought for better wages and benefits. Now, only one out of every 10 workers is a union member, while roughly 80 percent of jobs in the United States are in the service sector.

And it is these types of jobs, in health care, education, child care, disabled and senior care, that are expected to continue expanding at the quickest pace.

Most of them, though, fall short of paying middle-income wages. That does not necessarily reflect their value in an open market. Salaries for teachers, hospital workers, lab technicians, child care providers and nursing home attendants are determined largely by the government, which collects tax dollars to pay their salaries and sets reimbursements rates for Medicare and other programs.

They are also jobs that are filled by significant numbers of women, African-Americans, Latinos and Asians.

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The Week in Business: A Plan for Paid Family Leave

Good morning and happy May. Is anyone else itching for a vacation, or just a chance to go … elsewhere? Good news: If you’re vaccinated, you could escape to Europe (and help boost its ailing tourism industry) as soon as this summer. Here’s what you need to know for the week ahead in business and tech news. — Charlotte Cowles

Credit…Giacomo Bagnara

In his first address to Congress, President Biden detailed his American Families Plan, the third huge spending proposal that he has put forth in his 100 days in office. (The first was the $1.9 trillion stimulus package, signed into law in March, and the second was the American Jobs Plan, which focuses on infrastructure and has yet to pass Congress.) The latest proposal includes financing for universal prekindergarten, federal paid family leave, a permanent expanded child tax credit, subsidized child care for low- and middle-income families and free community college, among other initiatives. To pay for it, Mr. Biden wants to raise taxes on the rich. But most Republicans are opposed to tax increases and say the plan costs too much.

More signs of life from the economy. The country’s first-quarter gross domestic product was up 6.4 percent, at an annualized rate, according to the Commerce Department. That’s almost back to its prepandemic high. Consumer spending is also on the rise, and some analysts believe that it could grow more than 9 percent this year — a record — as health and job conditions continue to improve, and travel and dining open back up.

great for the tech giants. Amazon’s latest quarterly report showed such blockbuster sales — up 44 percent from the previous year — that it beat even the most optimistic forecasts. Meanwhile, Apple’s profits grew 54 percent, mostly thanks to soaring iPhone sales. And Facebook nearly doubled its revenue during the same time period, while Twitter’s jumped 28 percent. (Both companies have barred former President Donald J. Trump and some extremist figures from posting on their platforms since January, but it clearly hasn’t hurt their bottom lines.)

Credit…Giacomo Bagnara

The fight between Apple and Epic Games, which makes the popular video game Fortnite, heads to a federal court in California this week. The dispute began last year when Epic started selling Fortnite directly to its customers, violating its contract with Apple, which makes a 30 percent commission from App Store sales. Apple retaliated by kicking Fortnight off its store, and Epic fought back with a lawsuit. The case will be closely watched by other companies and lawmakers who have raised concerns about the App Store’s anti-competitive practices. Those include European regulators, who on Friday accused Apple of violating antitrust laws by imposing unfair rules and fees on rival music-streaming services.

For the good of your fellow humans, don’t stockpile toilet paper. But bear in mind that it’s about to get more expensive. Companies like Procter & Gamble, General Mills and Kimberly-Clark are all raising prices on everyday necessities like tampons, toilet paper, diapers and cereal this year to make up for increasing costs of production and shipping. Those costs grew during the pandemic, particularly when supply chains were pinched, but companies were reluctant to pass them along to struggling consumers. Now that the economy is starting to stabilize, expect some price adjustments to make up for the past year.

The travel industry is ready for takeoff — if you’re vaccinated, that is. The Centers for Disease Control and Prevention eased rules for cruise lines to resume operations, allowing some ships to set sail as soon as mid-July if they attest that 98 percent of the crew and 95 percent of passengers are fully vaccinated. And the European Union said that American tourists with vaccine certificates would be allowed to visit the bloc this summer, more than a year since it banned nonessential travel from most countries.

a long-anticipated ban on selling menthol cigarettes as well as all flavored cigars. (Possession will remain legal, however.) Amazon will increase pay between 50 cents and $3 an hour for half a million of its workers. And the Federal Reserve left interest rates near zero, playing down a rise in inflation and promising to continue support for the recovering economy.

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It’s Not Just the Really Wealthy Who Face Tax Increases

Mr. Biden has cleared up some issues for the middle class in his proposal. He has recommended an exemption of $1 million on the capital gains of assets transferred to heirs. He has also left in place the $250,000 exemption on taxable gains in the value of a person’s primary residence. (These exemptions would double for a couple.)

But in many cases, this would affect people who would not have had to think about paying any tax at death, whether the estate tax exemption remained the current $11.7 million or dropped to $3.5 million, which had been expected to happen.

“The changes to the step-up in basis — that’s the curveball,” said Paul Saganey, the founder and president of Integrated Partners, a financial advisory firm. “It’s really going to surprise people. People don’t know what it is or what it means, so how can they quantify the impact of it?”

Also missing was any mention of reinstating the full deduction for state and local taxes, known as SALT. The cap on these deductions in the 2017 tax law hurt people living in the Northeast and West Coast states, where the property and state taxes are higher.

Mr. Biden has proposed limiting a break on real estate transactions. He would cap at $500,000 the value of 1031(b) exchanges, which have essentially allowed real estate investors to roll gains from the sale of buildings into new buildings without ever paying capital gains taxes on them. Coupled with the step-up in basis at death, which wiped out all the gains in value of the buildings, this was a large tax break for families whose wealth rested on real estate investment and ownership.

What is less known is what, if anything, may be adopted from the “For the 99.5 percent” plan. The plan would close some popular tax-reduction strategies, many of which were targeted during the Obama administration.

Three of the proposals would be relatively easy to enact. One would end short-term trusts that allow people to pass tax-free to their heirs expected appreciation — say from the sale of a private business. Another would limit tax-free gifts that can be given each year to trusts to fund things like life insurance to pay estate taxes. A third would curtail special tax treatment that family partnerships receive, even when they own liquid securities and not an operating business.

“They already have the regulations written of these,” Ms. Lucina said. “I don’t want to scare anyone that these will be enacted. But some of these could be enacted quickly and looked at as loophole closers.”

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Biden’s Tax Proposals Are Not Just for the Really Wealthy

Mr. Biden has cleared up some issues for the middle class in his proposal. He has recommended an exemption of $1 million on the capital gains of assets transferred to heirs. He has also left in place the $250,000 exemption on taxable gains in the value of a person’s primary residence. (These exemptions would double for a couple.)

But in many cases, this would affect people who would not have had to think about paying any tax at death, whether the estate tax exemption remained the current $11.7 million or dropped to $3.5 million, which had been expected to happen.

“The changes to the step-up in basis — that’s the curveball,” said Paul Saganey, the founder and president of Integrated Partners, a financial advisory firm. “It’s really going to surprise people. People don’t know what it is or what it means, so how can they quantify the impact of it?”

Also missing was any mention of reinstating the full deduction for state and local taxes, known as SALT. The cap on these deductions in the 2017 tax law hurt people living in the Northeast and West Coast states, where the property and state taxes are higher.

Mr. Biden has proposed limiting a break on real estate transactions. He would cap at $500,000 the value of 1031(b) exchanges, which have essentially allowed real estate investors to roll gains from the sale of buildings into new buildings without ever paying capital gains taxes on them. Coupled with the step-up in basis at death, which wiped out all the gains in value of the buildings, this was a large tax break for families whose wealth rested on real estate investment and ownership.

What is less known is what, if anything, may be adopted from the “For the 99.5 percent” plan. The plan would close some popular tax-reduction strategies, many of which were targeted during the Obama administration.

Three of the proposals would be relatively easy to enact. One would end short-term trusts that allow people to pass tax-free to their heirs expected appreciation — say from the sale of a private business. Another would limit tax-free gifts that can be given each year to trusts to fund things like life insurance to pay estate taxes. A third would curtail special tax treatment that family partnerships receive, even when they own liquid securities and not an operating business.

“They already have the regulations written of these,” Ms. Lucina said. “I don’t want to scare anyone that these will be enacted. But some of these could be enacted quickly and looked at as loophole closers.”

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Biden, Calling for Big Government, Bets on a Nation Tested by Crisis

“People are fed up with this,” said Senator Rick Scott of Florida, who heads the campaign arm for Senate Republicans leading into the 2022 elections.

Those attacks do not seem to carry the same sway that they did during Mr. Obama’s tenure, when the White House proposed a much smaller economic stimulus package than many economists thought was warranted given the huge erosion in household wealth after the financial crisis. Mr. Obama did raise taxes on high earners, including to help fund the Affordable Care Act, but not at a scale close to what Mr. Biden is proposing.

Mr. Biden might have Mr. Trump to thank for part of that shift. The pandemic aid bills he signed last year, with bipartisan support in Congress, might have helped reset the public’s views of Washington’s spending limits; “trillion” was a red line of sorts under Mr. Obama, but no longer.

Mr. Trump also pushed Congress to approve direct checks, an effort Mr. Biden continued, and began the Operation Warp Speed vaccine program that helped hasten the deployment of the most significant driver of economic activity this year: vaccinated Americans. As the economy reopens and people return to work, economic optimism is rising, though Republicans nationwide remain more pessimistic and are far more likely to oppose Mr. Biden’s plans.

In Washington, the president does not need Republican support to push through his agenda. He needs only his party to hold together in the House and the Senate, where Democrats enjoy majorities by thin margins, and move as much spending and tax policy as possible through the process known as budget reconciliation. The maneuver bypasses Senate filibusters and allows legislation, like Mr. Biden’s relief bill this year, to pass with only majority-party votes.

That process will give large sway to moderate Democrats like Senator Joe Manchin III of West Virginia, but so far that group has not flinched at the scale of Mr. Biden’s ambitions. Mr. Manchin has said he will support $4 trillion in infrastructure spending.

It is unclear whether Mr. Biden can hold Mr. Manchin and others on his people-focused spending, like the education and child care efforts unveiled on Wednesday. His administration is trying to make the case on productivity grounds, casting the plan as investing in an inclusive economy that would help millions of Americans gain the skills and the work flexibility they need to build middle-class lifestyles.

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