All the economic effects of the Biden plan. Ispi report
Numbers, objectives and scenarios of the Biden plan on infrastructures and more. What emerges from the focus of the ISPI (Institute for International Political Studies)
The $ 2 trillion Biden plan for the development of US infrastructure and the macro data make Wall Street celebrate that yesterday it closed higher with the S&P 500 hitting a new record, ending trading above 4,000 points for the first time.
This was the day when the technological Nasdaq, which recently came under pressure due to the hike in bond rates, also showed new verve with a jump close to two percentage points.
HOW TO. MOVES BIDEN
After the 1900 billion dollar maxi stimulus approved in February, the US president is relaunching with a second project worth over 2 thousand billion dollars dedicated almost entirely to infrastructure, and which has the ambitious goal of creating "the most resilient and innovative of the world ". An intervention spread over 8 years that focuses, in addition to the modernization of infrastructure and housing, on urgent issues such as climate change, competition with China, social assistance, productivity and, above all, employment.
THE WORDS OF TREASURE AND THE FAITH
According to Treasury Secretary Janet Yellen, the plan will make the US economy "much more competitive". The over $ 2 trillion infrastructure plan proposed by US President Joe Biden "will push growth, not inflation," said Mary Daly, the president of the San Francisco Fed, in an interview with Axios . Many fear that this project, in addition to the recently approved $ 1.9 trillion stimulus plan, could raise inflation, prompting the Fed to raise interest rates earlier than expected. “It will be a boost for growth and not for inflation. There will be more workers, better manufacturing, roads and bridges and digital infrastructure will improve. It is very good for our economy. It will allow us to grow faster ”. Daly then said that there is no reason for the Fed to shorten the timeframe for an interest rate hike.
THE ISPI ANALYSIS
The initiatives announced in the administration's substantial project – summarized the ISPI in a focus dedicated to the Biden plan – provide for 621 billion dollars for transport (the renewal of 20 thousand miles of roads and motorways and 10 thousand bridges is expected), 550 billion of dollars for the 'advanced' manufacturing sector which includes companies for cutting-edge medical production, 100 billion dollars for the development of broadband and a series of social interventions: 213 billion dollars for social housing , 100 for schools, 400 for support for the elderly and disabled. And the intentions of the new administration is only the first half of an overall plan that will amount to 4 trillion dollars. The second part, to be announced in the coming weeks, will be called the "American Family Plan".
THE COMMENT OF DEL PERO
Mario del Pero, ISPI and SciencesPo, an expert on the United States, commented: "There are different and closely interrelated objectives in the ambitious infrastructure investment plan proposed by Biden: the need to respond to the almost grotesque obsolescence of so many part of roads, railways and bridges in use today (when we talk about railways, the contrast with European, Japanese or Chinese high speed is macroscopic); the willingness to use this other fiscal stimulus as an effective multiplier of economic growth; the intention to use this growth in a redistributive sense to correct imbalances and inequalities. Biden is betting on the possibility of convincing a riotous Congress to approve a plan of this magnitude, financed only by a tax increase (starting from those on corporate profits). Above all, it bets on the willingness of a part of the country to return to a paradigm of development, and of democratic capitalism, in which federal investments are central ”.
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This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/mondo/tutti-gli-effetti-economici-del-piano-biden-report-ispi/ on Fri, 02 Apr 2021 07:44:20 +0000.