Expenditure of 3000 billion | Democrats urged to adopt Biden plan ahead of COP26

by time news

(Washington) The American Democrats were playing tight Wednesday in Congress: they want to find an agreement on Joe Biden’s investment plans before he leaves for the G20 and COP26 in Europe, and therefore have less than 24 hours to agree.




Delphine TOUITOU and Julie CHABANAS
France Media Agency

The American president hopes to be able to present to his international partners the image of the United States engaged in the energy transition, growth, but also the fight against social inequalities and tax evasion.

It is therefore a race against time which is engaged in Congress to try to unite all the fringes of the Democratic Party and to obtain an agreement, before Joe Biden leaves Thursday for Rome (Italy) then Glasgow (Scotland).

PHOTO ANDREW HARNIK, ASSOCIATED PRESS

“An agreement is within reach and we hope to arrive at the framework of an agreement by the end of the day”, declared a little earlier the Democratic leader of the Senate, Chuck Schumer.

“We are very close” to an agreement, assured Wednesday the spokesperson of the White House, Jen Psaki, welcoming a “broad agreement in Congress among the Democrats”.

She wanted to be reassuring about the possibility of achieving this before the presidential plane takes the direction of Europe: “it is only 1.30 pm”.

Democrats are working on two programs spanning 8 to 10 years: one concerns investments of $ 1.2 trillion to modernize infrastructure; the other covers social and environmental measures and its amount, greatly reduced since the initial proposal, should be around 1500 billion.

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However, it would be the “biggest investment in the history of the fight against the climate crisis by the United States”, pleaded Jen Psaki.

“An agreement is within reach and we hope to arrive at the framework of an agreement by the end of the day”, declared a little earlier the Democratic leader of the Senate, Chuck Schumer.

“Some richer”

The financing of the plans is the subject of heated debates within the Democratic Party, and the outlines of a tax on the super-rich were presented on Wednesday.

“The billionaire income tax would apply to around 700 taxpayers and would raise hundreds of billions of dollars,” according to this new proposal made by Democratic Senator Ron Wyden, head of the US Senate Finance Committee.

PHOTO SUSAN WALSH, ARCHIVES REUTERS

Democratic Senator Ron Wyden, head of the US Senate Finance Committee.

This would ensure that “the richest people in the country pay their fair share to (finance) historic investments in childcare, paid leave and the fight against the climate crisis,” it said.

The big news is to tax the unrealized capital gains, these dormant gains in the thick portfolios of stocks of the great American fortunes.

The text thus specifies that “only taxpayers with more than $ 100 million in annual income or more than $ 1 billion in assets over three consecutive years would be covered by the proposal”.

According to American media, the tax rate used would be 23.8%.

Today, a wealthy shareholder like Elon Musk, boss of Tesla, or Jeff Bezos, the founder of Amazon, does not pay taxes on these unrealized capital gains on the pretext that these gains do not exist as long as they are not actually cashed.

PHOTO BALINT PORNECZI, ARCHIVES BLOOMBERG

The tax on the super-rich proposed by the Biden administration must help finance the broad investment plans of the Democratic party. Above, luxury boats at the Monaco Yacht Show, run by the super-rich around the world interested in cruising aboard their own boat.

The “richest few” can escape tax by holding these assets indefinitely, which nevertheless allow them to borrow and finance their lifestyle.

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Centrist Senators

The question now is whether this text will find favor in the eyes of centrist Democratic Senators Joe Manchin and Kyrsten Sinema, whose role is crucial, the Democratic majority in the Senate being so tenuous that the party must obtain all votes without exception.

Joe Manchin seemed reluctant: “I don’t like the connotation that we’re targeting different people. […] that contribute to society and create a lot of jobs ”.

He told reporters, however, that Democrats “absolutely” must be able to secure the framework of a deal by the end of the day, the political news site reports. The Hill.

PHOTO ANDREW HARNIK, ASSOCIATED PRESS

Democratic Senator Joe Manchin appeared reluctant to vote for a law taxing the super-rich.

Kyrsten Sinema, opposed to tax increases, has not yet said whether or not she intends to support this method of financing. On the other hand, on Tuesday, she decided in favor of the minimum tax of 15% on multinationals.

She explained that she saw it as “a common sense step to ensure that highly profitable companies […] pay a reasonable minimum tax on their profits ”.

This minimum tax, which should affect some 200 companies including the tech sector, has indeed returned to the forefront, after the presentation of a text Tuesday by several senators.

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