Last week, Joe Biden released the American Jobs Plan (AJP), aka the “Infrastructure” plan which proposed $2.3 trillion in new federal spending on various forms of public infrastructure, research and development, workforce training, affordable housing, and caregiving. Later reporting confirmed that the AJP would include an additional $400 billion in clean energy tax credits not specified in the administration’s original announcement.
And while Biden and his handlers have been eager to paint the massive stimulus bill as accretive for both the economy and taxpayers, an analysis conducted by the Penn Wharton Budget Model found that the proposed business tax provisions – which continue past the budget window – will decrease GDP by 0.8% in 2050, relative to current law. Here’s why:
the spending provisions of the AJP, in absence of any tax increases, would increase government debt by 4.72% and decrease GDP by 0.33% in 2050, as the crowding out of investment