After protests from his own ranks, Joe Biden must give up parts of his investment package. However, the US President speaks of a "historic" program to turn climate change into an opportunity.

US President Joe Biden unveiled a scaled-down version of his highly competitive package for social and climate protection investments on Thursday. Under pressure from parts of his party, Biden has cut the package dramatically. The budget is now 1.75 trillion US dollars.

Originally, Biden had targeted a package that was twice that size, valued at $ 3.5 trillion. Moderate Democrats, however, had resisted such high spending and, in months of negotiations, forced the President to abandon parts of his plans.

Biden, however, praised the package as "historic" at a press conference. The package will create millions of jobs, lead to economic growth, and strengthen the US to compete with China and other countries. It also includes the "most significant investments" in history in the fight against climate change and will "turn the climate crisis into an opportunity." The package is also fully financed and will not lead to new debt.

Biden admitted, however, that the plans do not go as far as he and many in his Democratic Party wanted. "Nobody got everything they wanted, including me," said the President. "But that's how compromises are."

High-ranking employees of the White House expressed their confidence that the necessary majorities for the slimmed-down package would now come about in both chambers of congress. However, there was initially no official agreement with the various party wings of the Democrats.

555 billion for climate protection

The most essential item in the package provides $ 555 billion for climate protection. Of this, $ 320 billion will be made available for tax credits for climate protection measures.

The US $ 105 billion is planned for adaptation measures to the consequences of global warming. It also plans to invest $ 110 billion in climate-friendly technologies.

To finance his plans, Biden intended to raise the corporate tax from 21 to 28 percent. However, this project failed due to internal resistance. The President now wants to ensure actual minimum taxation of 15 percent for corporations - as decided by 136 countries under the industrialized countries organization OECD.

Biden also wants to tax multimillionaires and billionaires higher, close tax loopholes, and better equip the tax authorities. Altogether, according to the White House, it would bring in almost two trillion dollars - and thus exceed the expenditure of the social and climate package.

Social spending with apparent cutbacks

The package includes free preschools for all three to four-year-olds. In addition, families are to be supported with the expenses for other childcare. Biden plans to provide $ 400 billion for both programs together.

Biden wants to extend the tax breaks for families with children introduced in the corona pandemic by one year. A tax credit for low-income earners without children is also to be extended. The two together would cost $ 200 billion. In addition, Biden wants to invest 150 billion dollars in better care in old people's and nursing homes.

Various plans that Biden had initially been envisaged and was part of his political agenda in the presidential election campaign fell out of the package. This includes paid parental leave for employees and coverage for dental treatments as part of state social insurance (Medicare). In addition, the President had initially aimed for two years of free higher education at so-called community colleges but had to give up this project.

Source: JustTheFactsMax