June 7, 2021
Remarks, as prepared, for the U.S. Department of Commerce’s SelectUSA Investment Summit promoting foreign direct investment in the United States.
Hello. It’s wonderful to join you to today. I want to thank the Secretary Raimondo and the Commerce Department for inviting me to say a few words about the US economy — and where our administration would like to guide it in the coming years.
As you’re likely aware, our economy is in the midst of a rapid transition. With more and more Americans vaccinated, and more businesses resuming normal operations every day, our economy is returning to its pre-pandemic state.
Increasingly, the question we are asking is not: What will the economy look like in 2022? By next year, I expect our economy to be back at full employment, in large part because we’ve provided an historic amount of relief to both families and businesses.
Instead, the questions we’re asking are: What will the economy look like in 2023? In 2024? In the years beyond?
I know many in this audience are asking similar questions. When investors and managers decide where to put their resources, they do so with a long-term vision. I want you to know: The Biden Administration takes the same long-term view. Our goal is to cement America’s status, for decades to come, as the world’s most attractive place for firms to put down roots, to scale up, and to hire workers. To do this, we have proposed historic changes to the status quo.
REBUILDING INFRASTRUCTURE & SUPPORTING WORKERS
Since the 1980s, our nation has seen declining investment in public goods: infrastructure, education and training, childcare. The impact on private sector competitiveness cannot be denied. When people can’t find a way to raise their children without staying home, they don’t participate in the labor force. This is why our female labor force participation rate was hovering near where it was in the late ’80s and early ’90s. To reverse these four decades of under-investment in public goods, the President proposed two plans: the American Jobs Plan and the American Families Plan.
The Jobs Plan would implement a range of productivity and profitability-boosting public investments totaling $2.2 trillion over the coming ten years — about three-quarters of one percent of GDP — a large number but an achievable one.
That funding will be used to build and modernize physical infrastructure like bridges and roads.
But there will also be investments in an infrastructure for the future: broadband, research and development, public transportation, modernized schools, and a more expansive network of child-care providers.
Perhaps most critically, the Jobs Plan invests in a clean and sustainable future, one in which America leads the way in a global economic transformation to a lower carbon economy. The plan invests public dollars in clean energy, electric vehicles and charging infrastructure, electricity grid improvements, and clean manufacturing. And importantly, these public dollars will unlock private ones. By indicating where our country is heading on climate investment, we will tap into the trillions of dollars of private capital that have already made sustainable investing one of the fastest growing investment sectors worldwide.
Then there is the American Families Plan, which includes major investments in education, childcare, and the care economy. As I mentioned, investment in early childhood care can be an important determinant of labor force participation. But so can paid leave. Expanding these programs is a critical step in reversing the ongoing divergence in labor force participation rates in our country compared to other developed countries.
In addition, a versatile education system that is closely tied to local labor markets should be a cornerstone of any 21st-century public investment program. Which is why our administration has committed to making community college free for every American.
PAYING FOR INVESTMENTS WITH TAX REFORM
Alongside the Jobs Plan, we are proposing a fiscally responsible path to pay for our investments by fundamentally reforming the corporate tax system.
With corporate taxes at a historical low of one percent of GDP, we believe the corporate sector can contribute to this effort by bearing its fair share: we propose simply to return the corporate income tax toward historical norms. At the same time, we want to eliminate incentives that reward corporations for moving operations overseas and shifting profits to low-tax countries. As part of this effort, we are working with our international partners on a global minimum corporate tax to stop the race to the bottom.
In addition to raising revenue, the Administration’s corporate tax proposals are focused on encouraging firms to invest in the United States, to create good-paying jobs for our nation’s workers. By eliminating tax preferences that encourage the offshoring of tangible assets and expanding credits for research and development and clean energy generation and storage, the reforms will encourage companies to invest, produce, and innovate on American soil.
Our plans are ambitious, and the President and I believe now is the time to recommit our government to playing a more active and smarter role in the economy.
The Administration’s planned actions are not fiscal stimulus in the way we have seen in the past. Nor are they intended to target a particular size of government. Rather, we’re proposing smart investments — to make our economy more competitive and sustainable.
If we make these investments, then I am confident that America will remain the world’s best place to do business for generations to come.