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American Jobs Plan (2021)

Republicans Reject Biden’s Bipartisan Infrastructure Deal

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WASHINGTON — The Biden administration sent Senate Republicans an offer on Friday for a bipartisan infrastructure agreement that sliced more than $500 billion off the president’s initial proposal, a move that White House officials hoped would jump-start the talks but that Republicans swiftly rejected.

The lack of progress emboldened liberals in Congress to call anew for Mr. Biden to abandon his hopes of forging a compromise with a Republican conference that has denounced his $4 trillion economic agenda as too expensive and insufficiently targeted. They urged the president instead to begin an attempt to move his plans on a party-line vote through the same process that produced his economic stimulus legislation this year.

Mr. Biden has said repeatedly that he wants to move his infrastructure plans with bipartisan support, which key centrist Democrats in the Senate have also demanded. But the president has insisted that Republicans spend far more than they have indicated they are willing to.

He also says that the bill must contain a wide-ranging definition of “infrastructure” that includes investments in fighting climate change and providing home health care, which Republicans have called overly expansive.

countered with a $568 billion plan, though many Democrats consider that offer even smaller because it includes extensions of some federal infrastructure spending at expected levels. In a memo on Friday to Republicans, obtained by The New York Times, Biden administration officials assessed the Republican offer as no more than $225 billion “above current levels Congress has traditionally funded.”

The president’s new offer makes no effort to resolve the even thornier problem dividing the parties: how to pay for that spending. Mr. Biden wants to raise taxes on corporations, which Republicans oppose. Republicans want to repurpose money from Mr. Biden’s $1.9 trillion economic aid package, signed in March, and to raise user fees like the gas tax, which the president opposes.

Mr. Biden “fundamentally disagrees with the approach of increasing the burden on working people through increased gas taxes and user fees,” administration officials wrote in their memo to Republican negotiators. “As you know, he made a commitment to the American people not to raise taxes on those making less than $400,000 per year, and he intends to honor that commitment.”

Still, the new proposal shows some movement from the White House. It cuts out a major provision of Mr. Biden’s “American Jobs Plan”: hundreds of billions of dollars for advanced manufacturing and research and development efforts meant to position the United States to compete with China for dominance in emerging industries like advanced batteries. Lawmakers have included some, but not all, of the administration’s proposals in those areas in a bipartisan bill currently working its way through the Senate.

Mr. Biden’s counteroffer would also reduce the amount of money he wants to spend on broadband internet and on highways and other road projects. He would essentially accept the Republicans’ offer of $65 billion for broadband, down from $100 billion, and reduce his highway spending plans by $40 billion to meet them partway. And it would create a so-called infrastructure bank, which seeks to use public seed capital to leverage private infrastructure investment — and which Republicans have pushed for.

Republican senators who were presented the offer in a conference call with administration officials on Friday expressed disappointment in it, even as they vowed to continue talks.

“During today’s call, the White House came back with a counteroffer that is well above the range of what can pass Congress with bipartisan support,” said Kelley Moore, a spokeswoman for Senator Shelley Moore Capito of West Virginia, who is leading the Republican negotiating group.

“There continue to be vast differences between the White House and Senate Republicans when it comes to the definition of infrastructure, the magnitude of proposed spending, and how to pay for it,” Ms. Moore said. “Based on today’s meeting, the groups seem further apart after two meetings with White House staff than they were after one meeting with President Biden.”

The updated White House offer drew immediate pushback from progressives as well, illustrating the extent to which the forces pushing against a deal are bipartisan. Senator Edward J. Markey, Democrat of Massachusetts, urged his party not to “waste time” haggling over details with Republicans who do not share their vision for what the country needs.

“A smaller infrastructure package means fewer jobs, less justice, less climate action, and less investment in America’s future,” Mr. Markey said in a news release.

Democratic leaders on Capitol Hill have watched the talks skeptically, wary that Republicans will eat up valuable time on the legislative calendar and ultimately refuse to agree to a deal large enough to satisfy liberals. While they have given the White House and Republican senators latitude to pursue an alternative, party leaders are under increasing pressure from progressives to move a bill unilaterally through the budget reconciliation process in the Senate.

They have quietly taken steps to make that possible in case the talks collapse. Aides to Senators Chuck Schumer, Democrat of New York and the majority leader, and Bernie Sanders, independent of Vermont and the chairman of the Budget Committee, met on Thursday with the Senate parliamentarian to discuss options of proceeding without Republicans under the rules.

Biden administration officials were frustrated that Republicans did not move more toward the president in a new offer they presented this week in negotiations on Capitol Hill. They made clear to Republicans on Friday that they expected to see significant movement in the next counteroffer, and that the timeline for negotiations was growing short, a person familiar with the discussions said.

The administration may soon find itself negotiating with multiple groups of senators. A different, bipartisan group plans to meet on Monday night to discuss spending levels and proposals to pay for them. Members of the group — which includes Mitt Romney of Utah, Susan Collins of Maine, Bill Cassidy of Louisiana and Rob Portman of Ohio, all Republicans, as well as Kyrsten Sinema of Arizona and Joe Manchin III of West Virginia, both Democrats — helped draft a bipartisan coronavirus relief bill in December.

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Ford F-150 Lightning Is a Major New E.V. Contender

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Ford Motor is about to open a major new front in the battle to dominate the fast-growing electric vehicle market, and it’s banking on one of the world’s most powerful business franchises.

In a splashy presentation Wednesday night at a Ford plant in Dearborn, Mich., the automaker will unveil an electric version of its popular F-150 pickup truck, which will be called the Lightning. Ford’s F-Series trucks, including the F-150, make up the top-selling vehicle line in the United States, and typically generate about $42 billion a year in revenue, according to a study commissioned by Ford — or more than twice what McDonald’s brought in last year.

It is one of the most anticipated introductions of a new car and invites comparisons to Ford’s Model T, the car that made automobiles affordable to the masses. Ford has a lot at stake in the new vehicle’s success. If it can turn the F-150 Lightning into a big seller, it could accelerate the move toward electric vehicles, which scholars say is critical for the world to avoid the worst effects of climate change.

Tailpipe pollution from cars and trucks represents the largest source of greenhouse gas emissions in the United States and one of the largest in the world. But if the Lightning does not sell well, it could suggest that the transition to E.V.s will be a lot slower than President Biden and other world leaders need to achieve climate goals.

auto industry’s E.V. push, which has been aimed at niche markets so far. Tesla has grown rapidly for the last several years by selling flashy sports cars to the affluent and early adopters. It sold close to 500,000 cars globally last year, a little more than half as many F-Series trucks Ford sold. Other electric models that have sold well have been small cars, such as the Chevrolet Bolt and Nissan Leaf, that appeal to environmentally minded consumers.

The F-150 Lightning, in contrast, is aimed at small businesses and corporate customers such as building contractors and mining and construction companies that buy lots of rugged pickups. These buyers typically care not just about the sticker price of a truck but also how much it costs to operate and maintain. Electric vehicles tend to cost more to buy but less to own than conventional cars and trucks because they have fewer parts and electricity is cheaper than gasoline or diesel on a per mile basis.

“There are a lot of big fleets who have been looking for green solutions but haven’t had any answers until now,” William C. Ford Jr., the company’s chairman and a great-grandson of Henry Ford, said in an interview.

General Motors and start-ups like Rivian are also working on electric pickups. Rivian has said it will start delivering its truck, the R1T, this summer and G.M. is expected to sell the GMC Hummer pickup truck later this year.

many people will buy them. Beyond commercial buyers, trucks like the F-150, Chevrolet Silverado and the Ram tend to be bought by people who have a lot of stuff to haul or by people — usually men — who like driving trucks.

“There will probably be some initial raised eyebrows, but once we get people to experience the driving dynamics and the extra room, the skepticism will abate,” Mr. Ford said.

The F-Series trucks have been the top-selling model line in the United States for the last 44 years. A 2020 study by the Boston Consulting Group found the truck supports 500,000 jobs at Ford, parts suppliers and dealerships.

Ford’s introduction of the Lightning got a major boost from Mr. Biden, who on Tuesday visited the company’s Rouge Electric Vehicle Center where the pickup will be made. Before a pool of White House reporters gathered at the plant, Mr. Biden pulled up behind the wheel of a prototype covered in black-and-white camouflage sheeting used to conceal the shape of the truck ahead of the Wednesday event.

“This sucker’s quick,” Mr. Biden said, and let slip that the truck can zoom to 60 miles an hour in 4.4 seconds, a detail that wasn’t supposed to be released until Wednesday. Mr. Biden then zoomed off, reaching a top speed of 80 m.p.h.

The Secret Service normally does not allow presidents to drive. Ford officials were not sure Mr. Biden would drive the truck until he arrived at the Rouge center, but it’s not a surprise he did.

Mr. Biden is a well known car enthusiast and owns a green 1967 Corvette that was given to him by his father as a wedding present. In 2016, he and his Corvette appeared on an episode of “Jay Leno’s Garage,” in which he drove the car at an enclosed Secret Service training facility.

with union labor closely aligns with the Biden administration’s goal to cut greenhouse gas emissions, increase domestic manufacturing, support unions and accelerate the transition to electric vehicles.

The administration’s $2 trillion infrastructure proposal includes money to help build half a million charging stations and incentives for the purchase of electric vehicles.

Ford has said it plans on spending $22 billion to develop electric vehicles over a five-year period ending in 2025.

Other automakers are moving in the same direction. G.M. is spending a similar sum and has said it aims to produce only electric vehicles by 2035, setting a target date for phasing out the internal combustion engine, which has powered the auto industry for more than a century.

G.M. recently introduced an updated version of its electric car, the Chevrolet Bolt. It also plans to make an electric version of its popular Silverado pickup truck, which is one of the biggest competitors to the F-150.

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Electric Pickups Could Make or Break Biden’s Infrastructure Plans

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“The F-150 is generally driven by guys who have a certain image of driving around in a truck — and that image includes noise, gasoline, a muscle engine. We don’t know anything about consumer uptake of eclectic trucks. We don’t know if they’ll want to drive this.”

A study published this year found that about 20 percent of people who purchased electric passenger vehicles were dissatisfied with them — in part because they worried about the lack of electric vehicle charging stations — and returned to driving traditional vehicles.

But White House officials say the pickup Mr. Biden drove on Tuesday could help tip that calculation. The F-150 “has really been a high-performing work vehicle and leisure vehicle, and now you can get it without the expense of all of that gasoline,” Gina McCarthy, the White House national climate adviser, said in an interview.

So far, only Tesla has sold electric models in high volume, but Ford typically sells about 900,000 F-Series vehicles a year. Earlier this year, Ford began selling the Mustang Mach E, a battery-powered sport-utility vehicle styled to resemble the company’s famous sports car.

“We’re not just electrifying fringe vehicles,” the company’s chairman, William C. Ford Jr., said. “The Mustang and the F-150 are the heart of what Ford is, so this is a signal about how serious we are about electrification.”

Autoworkers have expressed concerns over the electric transition, which American automakers are increasingly embracing, because the production of an electric vehicle requires about one-third less human labor than a vehicle powered by an internal combustion engine.

But union leaders offered cautious support of the president’s cheerleading for the electric pickup.

“It is no secret that the U.S. auto industry is at a crossroads, as sales of electric vehicles and plug-in hybrids are poised to become more and more common on our roads and highways in the years ahead both at home and abroad,” said Rory L. Gamble, the president of the United Auto Workers. “Taxpayer dollars should be spent in support of U.S.-built vehicles, not imports. ”

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Rural Areas Are Looking for Workers. They Need Broadband to Get Them.

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As a manufacturer of asphalt paving equipment, Weiler is exactly the type of company poised to benefit if the federal government increases spending on roads and bridges. But when Patrick Weiler talks about infrastructure, the issue he brings up first has next to nothing to do with his company’s core business.

It’s broadband internet service.

Weiler is based in Marion County, Iowa, a rural area southeast of Des Moines. Internet speeds are fine at the company’s 400,000-square-foot factory, because Weiler paid to have a fiber-optic cable run from the nearby highway. But that doesn’t help the surrounding community, where broadband access can be spotty at best. That is a problem for recruitment — already one of the biggest challenges for Weiler and many other rural employers.

“How do you get young people to want to move back into these rural areas when they feel like they’re moving back into a time frame of 20 years ago?” asked Mr. Weiler, the company’s founder and chief executive.

Rural areas have complained for years that slow, unreliable or simply unavailable internet access is restricting their economic growth. But the pandemic has given new urgency to those concerns, at the same time that President Biden’s infrastructure plan — which includes $100 billion to improve broadband access — has raised hope that the problem might finally be addressed.

address to Congress last month. “This is going to help our kids and our businesses succeed in the 21st-century economy.”

Mr. Biden has received both criticism and praise for pushing to expand the scope of infrastructure to include investments in child care, health care and other priorities beyond the concrete-and-steel projects that the word normally calls to mind. But ensuring internet access is broadly popular. In a recent survey conducted for The New York Times by the online research platform SurveyMonkey, 78 percent of adults said they supported broadband investment, including 62 percent of Republicans.

Businesses, too, have consistently supported broadband investment. Major industry groups such as the U.S. Chamber of Commerce, the Business Roundtable and the National Association of Manufacturers have all released policy recommendations in the last year calling for federal spending to help close the “digital divide.”

Quantifying that divide, and its economic cost, is difficult, in part because there is no agreed-upon definition of broadband. The Federal Communications Commission in 2015 updated its standards to a minimum download speed of 25 megabits per second. The Department of Agriculture sets its standard lower, at 10 m.p.s. A bipartisan group of rural-state senators asked both agencies this year to raise their standards to 100 m.p.s. And speed-based definitions don’t take into account other issues, like reliability and latency, a measure of how long a signal takes to travel between a computer and a remote server.

recent study by Broadband Now, an independent research group whose data is widely cited, found that 42 million Americans live in places where they cannot buy broadband internet service, most of them in rural areas.

According to the F.C.C.’s definition, most of Marion County has high-speed access to the internet. But residents report that service is slow and unreliable. And with only one provider serving much of the county, customers have little leverage to demand better service.

Marion County, with 33,000 people, has economic challenges common to rural areas: an aging work force, anemic population growth and a limited set of employers concentrated in a few industries. But it also has assets, including its proximity to Des Moines and a group of employers willing to train workers.

Local leaders have plans to attract new businesses and a younger generation of workers — but those plans won’t work without better internet service, said Mark Raymie, chairman of the county Board of Supervisors.

“Our ability to diversify our economic base is dependent on modern infrastructure, and that includes broadband,” he said. “We can say, ‘Come and work here.’ But if we don’t have modern amenities, modern infrastructure, that sales pitch falls flat.”

Mr. Weiler’s daughter Megan Green grew up in Marion County, then left to go to college and start her career. When she moved home in 2017 to work for her father’s company, it was like returning to an earlier technological era.

“Our cellular service is more spotty, our wireless is more temperamental, and we definitely only have one choice,” Ms. Green, 35, said. “It’s a bit of a generational thing. We rely on internet access.”

Ms. Green moved home for family reasons. But finding others willing to do the same has been difficult. Broadband isn’t the only factor — shortages of housing and child care also rank high — but it is a major one. Recruiting is Weiler’s “No. 1 challenge,” Ms. Green said, despite wages that start around $20 an hour, before overtime.

The experience of the past year has accentuated the problem. When the pandemic hit last year, Weiler sent home any workers who didn’t have to be on the factory floor. But they quickly encountered a problem.

“I was shocked to know how many of our employees could not work from home because they did not have reliable internet access,” Ms. Green said. “We’re talking ‘seven minutes to download an email’ type internet access.”

Other local companies had a similar experience. In June, the Greater Des Moines Partnership, a regional business group, commissioned a study on how to improve the area’s digital infrastructure. With the state and federal governments considering significant investments, the group hopes its study will give it priority for funding, said Brian Crowe, the group’s head of economic development.

For Marion County and other rural areas, the widespread experiment with working from home during the pandemic could present an economic opportunity if the infrastructure is there to allow it. Many companies have said they will allow employees to continue to work remotely all or part of the time, which could free workers to ditch city life and move to the country — or take jobs at companies like Weiler while their spouses work from home.

“All of a sudden, it’s not going to be the case that in order to work for leading companies, you have to move to the cities where those companies are located,” said Adam Ozimek, chief economist for Upwork, a platform for freelancers. “It’s going to spread opportunity around.”

But broadband experts say there is no way that rural areas will get access to high-speed, reliable internet service without government help. If a place doesn’t have internet access in 2021, there is a reason: generally too few potential customers, too dispersed to serve efficiently.

“The private sector’s just not set up to solve this,” said Adie Tomer, a fellow at the Brookings Institution who has studied the issue. He likened the challenge to rural electrification almost a century ago, when the federal government had to step in to ensure that even remote areas had access to electrical power.

“This is exactly what we saw play out in terms of economic history in the 1910s, ’20s, ’30s,” he said. “It really is about towns being left behind.”

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Amid Economic Turmoil, Biden Stays Focused on Longer Term

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Administration officials express confidence that recent price surges in used cars, airfare and other sectors of the economy will prove temporary, and that job growth will speed up again as more working-aged Americans are vaccinated against Covid-19 and regain access to child care during work hours. They say Mr. Biden’s $1.9 trillion economic aid package, which he signed in March, will lift job growth in the coming months, noting that new claims for unemployment fell to a pandemic-era low on Thursday.

The officials also said it was appropriate for the president to look past the current crisis and push efforts to strengthen the economy long term.

The two halves of Mr. Biden’s $4 trillion agenda, the American Jobs Plan and the American Families Plan, are premised on the economy returning to a low unemployment rate where essentially every American who wants to work is able to find a job, Cecilia Rouse, the chair of the Council of Economic Advisers, said in an interview.

“The American Rescue Plan was rescue,” Dr. Rouse said. “It was meant as stimulus as we work through this hopefully once-in-a-century, if not longer, pandemic. The American Jobs Plan, American Families Plan are saying, look, that’s behind us, but we knew going into the pandemic that there were structural problems in our country and in our economy.”

Mr. Biden’s plans would raise taxes on high earners and corporations to fund new federal spending on physical infrastructure, care for children and older Americans, expanded access to education, an accelerated transition to low-carbon energy and more.

Those efforts “reflect the empirical evidence that a strong economy depends on a solid foundation of public investment, and that investments in workers, families and communities can pay off for decades to come,” Mr. Biden’s advisers wrote. “These plans are not emergency legislation; they address longstanding challenges.”

The five-page brief focuses on arguments about what drives productivity, wage growth, innovation and equity in the economy. The issues predate the coronavirus recession and recovery, and Democrats in particular have pledged for years to address them.

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How Child Care Went From ‘Girly’ Economics to Infrastructure

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That’s changing. The Biden administration and its allies are pushing the notion that caring for children — and the sick and the elderly — is just as crucial to a functioning economy as any road, electric grid or building. It’s human infrastructure, they argue, echoing a line of thought long articulated by feminist economists (and often ignored).

President Biden included money for home-based care for the elderly and the disabled under the umbrella of infrastructure, as part of a $2 trillion package he proposed in March. The next month, he proposed more funding for paid family leave, universal pre-K and $225 billion for child care.

The ambitious legislation is going to face huge hurdles in Congress, but Dr. Folbre, now 68, is both cautiously optimistic and heartened by the culture shift: “I often say to myself I’m glad I lived this long so I can say maybe I had a point.”

Mariel Mendez and her husband, David, each the first in their immigrant families to earn college degrees and find rewarding careers, assumed they’d rely on high-quality child care to make everything work. She holds a master’s in public health from Columbia University and works at a nonprofit near Kent, Wash., where they live; he has a master’s in education policy and works as a coach for elementary school teachers.

Yet, now they’re debating if one of them should stop working altogether.

Over the past year, the Mendezes have cycled through four different child-care arrangements for Milea, their 2-and-a-half-year-old daughter, starting with an overcrowded center they felt was unsafe, then a back-and-forth with an in-home day care struggling to survive through the pandemic, and a stressful marathon at home managing remote work and never-ending toddler duty.

“We’re starting to think for our mental health and for our relationship as a family, does it make more sense for one of us to step down, shift to part time?” said Ms. Mendez, 28, who is expecting another baby in June. The prospect of an infant, a full-time job and a still uncertain child-care arrangement is overwhelming. “I never thought I’d be here. That we would all be here,” she said.

But in a sense it was inevitable that they would be, since they were headed toward a cliff — with no bridge spanning it.

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Can the Biden Agenda Fix Middle America’s Deepest Problem?

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The debate is often framed as between “people” (policies to help individuals affected by economic change) and “places” (policies aimed at communities that are languishing).

“I don’t think we can ignore the role of place in public policy any longer and just allocate investments to people,” said Ross DeVol, president of Heartland Forward, a think tank based in Bentonville, Ark. “Because that creates a hollowing out in places that affects the entire country negatively.

“We can’t as a nation continue to advance our competitive position by concentrating more knowledge-based industries and research just on the coasts,” Mr. DeVol added, saying this results in soaring real estate prices in those coastal markets, as well as underused physical infrastructure and a lack of opportunity in the places left behind.

Federal policy in recent decades has arguably reinforced the disparity.

The federal government itself is based in one of the high-growth coastal metropolises. Nearly half of federal research and development spending in 2018 went to five states — California, Maryland, Massachusetts, New York and Virginia — and Washington, D.C., according to analysis of federal data by Brookings.

The Biden administration’s American Jobs Plan incorporates ideas from the bipartisan “Endless Frontier Act,” which, among other things, seeks to spend billions to create regional innovation hubs. The idea is to invest in cutting-edge research with potential for commercial spinoffs, worker training and other steps to create the kinds of virtuous cycles of innovation and jobs that already occur in places like Boston.

That could be a boon to places like Lincoln, Neb.

Its population has grown slowly but steadily in recent years; investments in things like high-speed internet have helped it avoid the cycle of decline affecting many other smaller cities in the Midwest. It is home to the University of Nebraska, which has strong programs in computer science and engineering, and it has a vibrant agribusiness sector.

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Janet Yellen says interest rates might need to rise to keep economy from overheating.

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Treasury Secretary Janet L. Yellen said higher interest rates might be needed to keep the economy from overheating given the large investments that the Biden administration is proposing to rebuild the nation’s infrastructure and remake its labor force.

The comments, shown on Tuesday at an event sponsored by The Atlantic, come amid heightened concern from some economists and businesses that the United States is in for a period of higher inflation as stimulus money flows through the economy and consumers begin spending again. The Treasury secretary has no role in setting interest rate policies.

Jerome H. Powell, the Federal Reserve chair, said last month that the central bank is unlikely to raise interest rates this year and wants to see further healing in the American economy before officials will consider pulling back their support by slowing government-backed bond purchases and lifting interest rates.

While the Fed is watching for signs of inflation, Mr. Powell and other Fed officials have said they believe any price spikes will be temporary and will not be sustained. On Monday, John C. Williams, president of the Federal Reserve Bank of New York, said that while the economy is recovering, “The data and conditions we are seeing now are not nearly enough” for the Fed’s policy-setting committee “to shift its monetary policy stance.”

spending approximately $4 trillion over a decade and would pay for the investments with tax increases on companies and the rich.

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Why Biden’s Plan to Raise Taxes for Rich Investors Isn’t Hurting Stocks

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“Most Democrats seem to be on board with narrowing the differential between the tax rate on capital gains and ordinary income, but there’s opposition for treating the rates as the same,” wrote analysts with Beacon Policy Advisors, a political consultancy. “This means there’s probably a middle ground for raising the capital gains rate on top earners to, say, 28 percent.”

If stocks continued their climb, it would largely be in keeping with previous periods when capital gains taxes were raised.

In 2013, when the tax rose to the current 23.8 percent, from 15 percent, on Americans with the highest incomes, the S&P 500 climbed nearly 30 percent. It was the best year for stocks in the last two decades. And after the top rate rose to 28 percent, from 20 percent, at the end of 1986, the market continued to roar higher, by nearly 40 percent through most of 1987.

Stocks eventually suffered their worst single-day collapse ever on Black Monday in October 1987, but that crash had little to do with tax policy, and the markets ended the year slightly higher. In 1991, a small increase to 28.9 percent in the capital gains rate for those with the largest incomes coincided with a 26 percent rise in the S&P 500. The major driver for that gain had nothing to do with taxes; it was the emergence from a recession.

Similarly, investors appear to be focusing on evidence that the economy is on the brink of breakneck growth. That surge is being fueled by a river of federal government spending, rock-bottom interest rates and more Covid-19 vaccinations. In the first three months of the year, the economy grew at an annualized clip of 6.4 percent. At that pace, 2021 would be the best year for growth since 1984.

Economic growth and corporate profits tend to rise together. And signs of additional oomph in the economy are already showing up in earnings reports from publicly traded companies.

Tech giants such as Tesla, Microsoft, Amazon, Apple and Google’s parent company, Alphabet, all reported first-quarter profits that trounced analyst expectations.

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

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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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