American Rescue Plan (2021)

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    Biden $1.8 Trillion Plan: Child Care, Student Aid and More

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    The proposed American Families Plan would expand access to education and child care. It would be financed partly through higher taxes on the wealthiest Americans.WASHINGTON — The Biden administration on Wednesday detailed a $1.8 trillion collection of spending increases and tax cuts that seeks to expand access to education, reduce the cost of child care and support women in the work force, financed by additional taxes on high earners.The American Families Plan, as the White House calls it, follows the $2.3 trillion infrastructure package President Biden introduced last month, bringing his two-part package of economic proposals to just over $4 trillion. He will present the details to a joint session of Congress on Wednesday evening.The proposal includes $1 trillion in new spending and $800 billion in tax credits, much of which is aimed at expanding access to education and child care. The package includes financing for universal prekindergarten, a federal paid leave program, efforts to make child care more affordable, free community college for all, aid for students at colleges that historically serve nonwhite communities, expanded subsidies under the Affordable Care Act and an extension of new federal efforts to fight poverty.Administration officials cast the plan as investing in an inclusive economy that would help millions of Americans gain the skills and the work flexibility they need to build middle-class lifestyles. They cited research on the benefits of government spending to help young children learn. In a 15-page briefing document, they said the package would help close racial and gender opportunity gaps across the economy.Many of the provisions, like tax credits to help families afford child care and a landmark expansion of a tax credit meant to fight child poverty, build on measures in the $1.9 trillion economic rescue plan Mr. Biden signed into law last month. The package would make many of those temporary measures permanent.But the plan also includes a maze of complicated formulas for who would benefit from certain provisions — and how much of the tab state governments would need to pick up.The package could face even more challenges than the American Jobs Plan, Mr. Biden’s physical infrastructure proposal, did in Congress. The president has said repeatedly that he hopes to move his agenda with bipartisan support. But his administration remains far from reaching a consensus with Republican negotiators in the Senate.Republicans have expressed much less interest in additional spending for education, child care and paid leave than they have for building roads and bridges. They have also chafed at the tax increases Mr. Biden has proposed, including the ones that will help pay for his latest package.The president is proposing an increase in the marginal income tax rate for the top 1 percent of American income earners, to 39.6 percent from 37 percent. He would increase capital gains and dividend tax rates for those who earn more than $1 million a year. And he would eliminate a provision in the tax code that reduces capital gains on some inherited assets, like vacation homes, that largely benefits the wealthy.Mr. Biden would also invest $80 billion in personnel and technology enhancements for the I.R.S., in hopes of netting $700 billion in additional revenues from high earners, wealthy individuals and corporations that evade taxes.Republicans and conservative activists have criticized all those measures. Administration officials told reporters that the president would be open to financing the spending and tax credits in his plan through alternative means, essentially challenging Republicans to name their own offsets, as Mr. Biden did with his physical infrastructure proposal.Still, many of the details in his new proposal poll well with voters across the political spectrum. Much of the package could win the support of the full Democratic caucus in Congress, which would need to band together to pass all or part of the plan through the fast-track process known as budget reconciliation, which bypasses a Senate filibuster.Expanded access to government-subsidized preschool and community college may have broad appeal. Workers with only high school degrees are often stuck in low-wage jobs, and two-thirds of mothers with young children are employed, and thus need reliable child care. The high cost of quality day care and pre-K puts these services out of reach for many families, who may rely on informal networks of relatives and neighbors who are untrained in early education.Expanding access to pre-K has been particularly popular over the past decade in states and cities, including some with Republican governors. A large body of research shows that achievement gaps between poor and middle-class children emerge in the earliest years of childhood and are present on the first day of kindergarten. Administration officials contend that free, quality early childhood education can both help cash-strapped parents and build students’ skills in ways that will help them become more productive workers.Still, there are major disagreements about how generous any expansion of pre-K should be. President Barack Obama’s administration generally favored a centrist approach in which new seats were geared toward lower-income families.Mr. Biden’s plan differs in that it calls for universal preschool for all 3- and 4-year-olds, including those from affluent families. That is the same approach pioneered in recent years by city programs in New York and Washington, which expanded quickly to serve a diverse swath of families, but not without some evidence that they replicated the segregation and inequities of the broader K-12 education system.Bruce Fuller, a professor of education at the University of California, Berkeley, has been a critic of the universal approach, instead favoring more targeted programs. He questioned whether states would do their part to fund the expansion and said the goal of paying all early childhood workers $15 per hour was too modest to broadly improve the quality and stability of the work force.“How governors weigh these competing priorities, ethically and politically, remains an open question,” he said.The proposed investment from Washington comes at a precarious time. Preschool enrollment declined by nearly 25 percent over the past year, largely because of the coronavirus pandemic. As of December, about half of 4-year-olds and 40 percent of 3-year-olds attended pre-K, including in remote programs. And only 13 percent of children in poverty were receiving an in-person preschool education in December, according to the National Institute for Early Education Research.Unlike the preschool proposal, the child care plan is not universal. It would offer subsidies to families earning up to 1.5 times their state’s median income, which could be in the low six figures in some locations. It would also continue tax credits approved in the pandemic relief bill this year that offer benefits to people earning up to $400,000 a year.As with Mr. Biden’s previous policy proposals, the American Families Plan offers something to many traditional Democratic Party constituencies. The administration is closely tied to teachers’ unions, and while many early childhood educators are not unionized, the proposal also calls for investments in K-12 teacher education, training and pay, which are all union priorities. One goal is to bring more teachers of color into a public education system where a majority of students are nonwhite.The expansion of free community college would apply to all students, regardless of income. It would require states to contribute to meet the goal of universal access, senior administration officials said on Tuesday. Mr. Biden would also expand Pell grants for low-income students and subsidize two years of tuition at historically Black colleges and universities, as well as at institutions that serve members of Native American tribes and other minority groups.Mr. Fuller said he expected the community college proposal to effectively target spending to the neediest students. About one-third of all undergraduates attend public two-year colleges, which serve a disproportionate number of students from low-income families.The paid leave program will phase in over time. The administration’s fact sheet says it will guarantee 12 weeks of paid “parental, family and personal illness/safe leave” by its 10th year in existence. Workers on leave will earn up to $4,000 a month, with as little as two-thirds or as much as 80 percent of their incomes replaced, depending on how much they earn.Other provisions include late concessions to key Democratic constituencies. Administration officials had removed the health care credits last week but added them back under pressure from Speaker Nancy Pelosi of California and others. They bucked pressure from House and Senate Democrats to make permanent an expanded child tax credit created by the pandemic relief bill, extending it through 2025. But the plan would make permanent one aspect of the expanded credit, which allows parents with little or no income to reap its benefits regardless of how much they earn. More

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    Federal Aid to Renters Moves Slowly, Leaving Many at Risk

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    Congress allocated $25 billion in December and another $21 billion in March to help people who fell behind on rent during the pandemic. Little has reached landlords or tenants.WASHINGTON — Four months after Congress approved tens of billions of dollars in emergency rental aid, only a small portion has reached landlords and tenants, and in many places it is impossible even to file an application.The program requires hundreds of state and local governments to devise and carry out their own plans, and some have been slow to begin. But the pace is hindered mostly by the sheer complexity of the task: starting a huge pop-up program that reaches millions of tenants, verifies their debts and wins over landlords whose interests are not always the same as their renters’.The money at stake is vast. Congress approved $25 billion in December and added more than $20 billion in March. The sum the federal government now has for emergency rental aid, $46.5 billion, rivals the annual budget of the Department of Housing and Urban Development.Experts say careful preparation may improve results; it takes time to find the neediest tenants and ensure payment accuracy. But with 1 in 7 renters reporting that they are behind on payments, the longer it takes to distribute the money, the more landlords suffer destabilizing losses, and tenants risk eviction.Millions of tenants are protected from eviction only by a tenuous federal moratorium that faces multiple court challenges, omits many households and is scheduled to expire in June.“I’m impressed with the amount of work that unsung public servants are doing to set up these programs, but it is problematic that more money isn’t getting out the door,” said Ingrid Gould Ellen, a professor at New York University who is studying the effort. “There are downstream effects if small landlords can’t keep up their buildings, and you want to reach families when they first hit a crisis so their problems don’t compound.”Estimates of unpaid rents vary greatly, from $8 billion to $53 billion, with the sums that Congress has approved at the high end of the range.The situation illustrates the patchwork nature of the American safety net. Food, cash, health care and other types of aid flow through separate programs. Each has its own mix of federal, state and local control, leading to great geographic variation.While some pandemic aid has flowed through established programs, the rental help is both decentralized and new, making the variation especially pronounced.While Charleston has started a local rent assistance program, South Carolina has $272 million to spend and has not begun taking applications.Cameron Pollack for The New York TimesAmong those seeking help is Saundra Broughton, 48, a logistics worker outside Charleston, S.C., who considered herself safely middle class in the fall, when she rented an apartment with a fitness center and saltwater pool. To her shock, she was soon laid off; after her jobless benefits were delayed, she received an eviction notice.“I’ve always worked and taken care of myself,” she said. “I’ve never been on public assistance.”A judge gave Ms. Broughton 10 days to leave her apartment. Only a last-minute call to legal aid brought word of the federal moratorium, which requires tenants to apply. She rushed to the library to print the form with 24 hours to spare. “But I still owe the money,” she said, about $4,600 and counting.If Ms. Broughton lived in nearby Berkeley County, she could have sought help as early as March 29. In Charleston County, a few miles away, she could have applied on April 12. But as a resident of Dorchester County, she must apply through the state, which has $272 million in federal money but is not yet taking applications.“Why are they holding the money?” she said. “I have thousands of dollars of debt and could be kicked out at any moment. It’s a very frightening feeling.”The huge aid measures passed during the early stages of the pandemic did not include specific provisions to help renters, though they did give most households cash. But hundreds of state and local governments started programs with discretionary money from the CARES Act, passed in March 2020. These efforts disbursed $4.5 billion in what amounted to a practice run for the effort now underway with 10 times the money.Lessons cited include the need to reach out to the poorest tenants to let them know aid is available. Technology often posed barriers: Renters had to apply online, and many lacked computers or internet access.The demand for documentation also thwarted aid, as many people without proof of leases or lost income could not finish applications. Some landlords declined to participate, perhaps preferring to seek new tenants.Despite rising need, programs in Florida and New York, financed by the CARES Act, returned tens of millions of unspent dollars to the states. By the time Congress passed the new program in December, nearly 1 renter household in 5 reported being behind on payments.The national effort, the Emergency Rental Assistance Program, is run by the Treasury Department. It allocates money to states and also to cities and counties with populations of at least 200,000 that want to run their own programs. About 110 cities and 227 counties have chosen to do so.The program offers up to 12 months of rent and utilities to low-income tenants economically harmed by the pandemic, with priority on households with less than half the area’s median income — typically about $34,000 a year. Federal law does not deny the aid to undocumented immigrants, though a few states and counties do.Modern assistance seems to demand a mix of Jacob Riis and Bill Gates — outreach to the marginalized and help with software. Progress slowed for a month when the Biden administration canceled guidance issued under President Donald J. Trump and developed rules that require less documentation.Other reasons for slow starts vary. Progressive state legislators in New York spent months debating the best way to protect the neediest tenants. Conservatives legislators in South Carolina were less focused on the issue. But the result was largely the same: Neither legislature passed its program until April, and neither state is yet accepting applications.“I just don’t know why there hasn’t been more of a sense of urgency,” said Sue Berkowitz, the director of the South Carolina Appleseed Legal Justice Center. “We’ve been hearing nonstop from people worried about eviction.”There is no complete data on how many tenants have been helped. But of the $17.6 billion awarded to state governments, 20 percent is going to states not yet taking applications, though some local programs in those states are. Florida (which has $871 million), Illinois ($566 million) and North Carolina ($547 million) are among those that have yet to start.“The pace is slow,” said Greg Brown of the National Apartment Association, who emphasized that landlords have mortgages, taxes and maintenance to pay.In a recent talk at the Brookings Institution, Erika Poethig, a housing expert on the White House Domestic Policy Council, praised the “unprecedented amount of rental assistance” and said “the federal government only has so much ability” to encourage faster action.Accepting applications is only the beginning. With $1.5 billion to spend, California has attracted 150,000 requests for help. But of the $355 million requested, only $20 million has been approved and $1 million paid.Texas, with $1.3 billion to spend, started quickly, but the company it hired to run the program had software failures and staffing shortages. A committee in the state House of Representatives found that after 45 days, the program had paid just 250 households.By contrast, a program jointly run by the city of Houston and Harris County had spent about a quarter of its money and assisted nearly 10,000 households.Not everyone is troubled by the pace. “Getting the money out fast isn’t necessarily the goal here, especially when we focus on making sure the money reaches the most vulnerable people,” said Diane Yentel, the director of the National Low Income Housing Coalition.Given the challenge, she said, “I think it’s going OK.”She points toward a program in Santa Clara County, Calif., that won praise for its outreach last year. Many of the people it served spoke little English or lacked formal leases to submit. Now, with $36 million to spend under the new program, it opted for weeks of additional planning to train 50 nonprofit groups to find the poorest households“Giving away money is actually quite hard,” said Jen Loving, who runs Destination: Home, a housing group leading the campaign. “All the money in the world isn’t going matter if it doesn’t get to the people who need it.”In Charleston, S.C., housing became a subject of concern after a 2018 study found the area had the country’s highest eviction rate. Charleston County ran three rounds of rental relief with CARES Act money, and the state ran two.The second state program, started with $25 million in February, drew so many applications that it closed in six days. But South Carolina is still processing those requests as it decides how to distribute the new federal funds.Antonette Worke is among the applicants awaiting an answer. She moved to Charleston from Denver last year, drawn by cheaper rents, warmer weather and a job offer. But the job fell through, and her landlord filed for eviction.Ms. Worke, who has kidney and liver disease, is temporarily protected by the federal eviction moratorium. But it does not cover tenants whose leases expire, as hers will at the end of next month. Her landlord said he would force her to move, even if the state paid the $5,000 in overdue rent.Ms. Worke is temporarily protected by a federal moratorium on evictions, but her lease is set to expire at the end of the month.Nora Williams for The New York TimesStill, she said the help was important: A clean slate would make it easier to rent a new apartment and relieve her of an impossible debt. “I’m stressing over it to the point where I’ve made myself sicker,” she said.Moving faster than the state, Charleston County started its $12 million program two weeks ago, and workers have taken computers to farmers’ markets, community centers and a mall parking lot. Christine DuRant, a deputy county administrator, said the aid was needed to prevent foreclosures that could reduce the housing stock. But critics would pounce if the program sent payments to people who do not qualify, she said: “We will be audited,” possibly three times.Latoya Green is caught where the desire for speed and accounting collide. A clerk who lost hours in the pandemic, she owes $3,700 in rent and utilities and is protected by the eviction moratorium only until her lease expires next month.She applied for help on the day the county program started but has not completed the application. She said she is unsettled by the emails requesting her lease, which she lacks, and proof of lost income.Still, Ms. Green does not criticize Charleston County officials. “I think they’re trying their best,” she said. “A lot of people run scams.”With time running short, she added: “I just hope and pray to God they’ll be able to assist me.” More

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    Biden's Spending Plans Could Start to Tackle Inequality

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    The Biden administration is relying on Congress instead of just the Fed to fix the economy. That mix could lead to a less wealth-unequal future.The coronavirus pandemic has threatened to rapidly expand yawning gaps between the rich and the poor, throwing lower-earning service workers out of jobs, costing them income, and limiting their ability to build wealth. But by betting on big government spending to pull the economy back from the brink, United States policymakers could limit that fallout.The $1.9 trillion economic aid package President Biden signed into law last month includes a wide range of programs with the potential to help poor and middle-class Americans to supplement lost income and save money. That includes monthly payments to parents, relief for renters and help with student loans.Now, the administration is rolling out additional plans that would go even further, including a $2.3 trillion infrastructure package and about $1.5 trillion in spending and tax credits to support the labor force by investing in child care, paid leave, universal prekindergarten and free community college. The measures are explicitly meant to help left-behind workers and communities of color who have faced systemic racism and entrenched disadvantages — and they would be funded, in part, by taxes on the rich.Forecasters predict that the government spending — even just what has been passed so far — will fuel what could be the fastest annual economic growth in a generation this year and next, as the country recovers and the economy reopens from the coronavirus pandemic. By jump-starting the economy from the bottom and middle, the response could make sure the pandemic rebound is more equitable than it would be without a proactive government response, analysts said.That is a big change from the wake of the 2007 to 2009 recession. Then, Congress and the White House passed an $800 billion stimulus bill, which many researchers have concluded did not do enough to fill the hole the recession left in economic activity. Lawmakers instead relied on the Federal Reserve’s cheap-money policies to coax the United States’ economy back from the brink. What ensued was a halting recovery marked by climbing wealth inequality as workers struggled to find jobs while the stock market soared.“Monetary policy is a very aggregated policy tool — it’s a very important economic policy tool, but it’s at a very aggregated level — whereas fiscal policy can be more targeted,” said Cecilia Rouse, who oversees the White House Council of Economic Advisers. In the pandemic crisis, which disproportionately hurt women of all races and men of color, she said, “If we tailor the relief to those who are most affected, we are going to be addressing racial and ethnic gaps.”From its first days, the pandemic set the stage for a K-shaped economy, one in which the rich worked from home without much income disruption as poorer people struggled. Workers in low-paying service jobs were far more likely to lose jobs, and among racial groups, Black people have experienced a much slower labor market rebound than their white counterparts. Globally, the downturn probably put 50 million people who otherwise would have qualified as middle class into lower income levels, based on one recent Pew Research analysis.But data suggest the U.S. policy response — including relief legislation that passed last year under the Trump administration — has helped mitigate the pain.“The CARES Act to the American Rescue Plan have helped to support more households than I would have imagined,” Charles Evans, the president of the Federal Reserve Bank of Chicago, told reporters this month during a call, referring to the pandemic relief packages passed in early 2020 and early 2021.Wealth has recovered nearly across the board after slumping early last year, foreclosures have remained low, and household consumption has been shored up by repeated stimulus checks.While the era has been fraught with uncertainty and people have slipped through the cracks, this downturn looks very different for poorer Americans than the post-financial crisis period. That recession ended in 2009, and America’s wealthiest households recovered precrisis wealth levels by 2012, while it took until 2017 for the poorest to do the same.At a food bank in Phoenix last month. The $1.9 trillion economic aid package signed into law includes a wide range of programs with the potential to help poor and middle-class Americans.Juan Arredondo for The New York TimesThe government’s policy response is driving the difference. In the 2010s, Republicans cited deficit worries and curtailed spending early, at a time when the economy remained far from healed after the worst downturn since the Great Depression. Interest rates were already near zero and not offering much of an economic lift, so the Fed engaged in several rounds of large-scale bond purchases to try to bolster the economy.The Fed policies did help. But low rates and huge bond-buying bolstered the economy slowly, and by first increasing prices on financial assets, which rich households are much more likely to own. As companies gain access to cheap capital to expand and hire, the workers who secure those new jobs have more money to spend, and a happy cycle unfolds.By 2019, that prosperous loop had kicked into gear and unemployment had dropped to half-century lows. Black and Hispanic as well as less-educated workers were working in greater numbers, and wages at the bottom of the income distribution had begun to steadily climb.Poverty fell, and there were reasons to hope that if that had continued, income inequality — the gap between how much the poor and the rich earn each year — might soon decline. Lower income inequality could, in theory, lead to lower wealth inequality over time, as households have the wherewithal to save more evenly.But getting there took nearly a decade and when the pandemic hit in 2020, it almost certainly disrupted the trend. The data are released on a lag.As those divergent trends between labor and capital played out, the rich rebuilt their savings — which are heavily invested in stocks and businesses — much faster. Poorer households eventually reaped benefits as the years wore on and people landed jobs. The bottom half of America’s wealth holders ended up better off than they had been before the crisis, but farther behind the rich.At the start of 2007, the bottom half of the wealth distribution held 2.1 percent of the nation’s riches, compared to 29.7 percent for the top 1 percent. By the start of 2020, the bottom half had 1.8 percent, while the top 1 percent held 31 percent.Researchers debate whether monetary policy actually worsens wealth divides in the long run — especially since there’s the hairy question of what would have happened had the Fed not acted — but monetary policymakers generally agree that their policies can’t stop a pre-existing trend toward ever-worse wealth inequality.By offering a more targeted boost from the very start of the recovery, fiscal policy can. Or, at a minimum, it can prevent wealth gaps from deepening so much.Monetary policy “is naturally trickle-down,” said Joseph Stiglitz, an economist at Columbia and Nobel laureate. “Fiscal policy can work from the bottom and middle up.”That’s what the Biden administration is gambling on. Paired with packages from December and last April, Congress’s recent package will bring the amount of economic relief that Congress has approved during the pandemic to more than $5 trillion. That dwarfs the amount spent in the last recovery.The legislation is a mosaic of tax credits, stimulus checks and small-business support that could leave families at the lower end of the income and savings distribution with more money in the bank and, if its provisions work as advertised, with a better chance of returning to work early in the recovery.There is no guarantee Mr. Biden’s broader economic proposals, totaling about $4 trillion, will clear a narrowly divided Congress. Republicans have balked at his plans and this week offered a counterproposal on infrastructure that is only a fraction the size of what Mr. Biden wants to spend. A bipartisan group of House moderates is pushing the president to finance infrastructure spending through an increased gas tax or something similar, which hits the poor harder than the rich.Still, the president’s new proposals could have long-term effects, working to retool workers’ skills and lift communities of color in hopes of putting the economy on more equal footing. The president is set to outline his so-called American Family Plan, which is focused on the work force, before his first address to a joint session of Congress next week.While details have yet to be finished, programs like universal prekindergarten, expanded subsidies for child care and a national paid leave program would be paid for partly by raising taxes on investors and rich Americans. That could also affect the wealth distribution, shuffling savings from the rich to the poor.The plan, which must win support in a Congress where Democrats have just a narrow margin, would raise the top marginal income tax rate to 39.6 percent from 37 percent, and raise taxes on capital gains — the proceeds of selling an asset, like a stock — for people making more than $1 million to 39.6 percent from 20 percent. Counting in an Obamacare-related tax, the taxes they pay on profits would rise above 43 percent.If the Biden package helps a wide swath of people to get back to earning and saving money faster this time, there’s hope that it might set the economy on a different trajectory.Jim Wilson/The New York TimesThe new policies will not necessarily cut wealth inequality, which has been on an inexorable upward march for decades, but they could keep poorer households from falling behind by as much as they would have otherwise.Betting big on fiscal policy to return the economy to strength is a gamble. If the economy overheats, as some prominent economists have warned it could, the Fed might have to rapidly lift interest rates to cool things down. Rapid adjustments have historically caused recessions, which consistently throw vulnerable groups out of jobs first.But administration officials have repeatedly said the bigger risk is underdoing it, leaving millions on the labor market’s sidelines to struggle through another tepid recovery. And they say the spending provisions in both the rescue package and the infrastructure could help to fix longstanding divides along racial and gender lines.“We think of investment in racial equity, and equity in general, as good policy, period, and integral to all the work we do,” Catherine Lhamon, a deputy director of the Domestic Policy Council, said in an interview. More

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    Signs of Economic Hope Are Growing, Some With Superlatives

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    Soaring retail sales and a sharp drop in jobless claims are the latest reflection of a quickening recovery and suggest a year of remarkable growth.The American economic recovery is gathering steam, renewing confidence that a vibrant revival awaits as the pandemic recedes.After months of false starts, evidence is mounting that the economy has definitively turned a corner, with more growth on the horizon. Job gains last month were the strongest since August. There are signs that the snarled global supply chain may be untangling.And in dual reports on Thursday, the government reported more good news: Retail sales in March blew past expectations, rising nearly 10 percent, and jobless claims last week fell to their lowest level of the pandemic.Even as the country is still straining to contain the virus, as millions of people remain unemployed and as a large portion of the population remains unvaccinated, the data suggests that the long-heralded economic rebound is within reach.“I’m feeling quite optimistic,” said Gregory Daco, chief U.S. economist at Oxford Economics. “I think what we’re seeing is evidence of this booming economy that we’re going to be seeing over the coming months.”In the year since the coronavirus smothered the economy, economists have held out hope for a significant turnaround defined by plentiful job opportunities, higher wages and supercharged spending after months of pent-up demand. But the tantalizing promise at times appeared unlikely at best: After a period of growth over the summer, job gains largely stalled heading into the new year. New state unemployment claims spiked to over a million in one week in January. Retail sales, bolstered by stimulus payments, jumped in January only to slide the next month.Monthly Retail Sales

    Seasonally adjusted advance monthly sales for retail and food services.Source: Commerce DepartmentThe New York TimesYet recent weeks have delivered increasing reason for hope. With a fresh round of federal payments in their pockets and vaccines in their arms, many Americans have begun shopping and dining out with renewed alacrity, driving retail sales. A 9.8 percent increase last month was a strong comeback from the nearly 3 percent drop in February, when previous stimulus money had dissipated and a series of winter storms made travel difficult across much of the United States.The increase was broad-based, including big-ticket purchases like cars and discretionary spending on sporting goods, which economists interpreted as a sign of strong household income and growing optimism. Sales of clothing and accessories rose 18 percent, while restaurants and bars recorded a 13 percent increase — demonstrating how many areas of consumption are bouncing back.“I found it very encouraging that there are signs that people are waking up from hibernation, buying new clothes and going out to restaurants,” said Beth Ann Bovino, U.S. chief economist at S&P Global. “I think people are feeling optimistic that the United States will win the war on the virus. And they have good reason to be hopeful.”Many economists said the strong retail sales were likely to continue through the spring, even after the new stimulus payments are used up.The gradual return to normal activities as business restrictions ease has in turn prompted employers to recall workers — and this time, to hold on to them.The Labor Department reported on Thursday that the number of first-time claims for state unemployment benefits fell sharply last week, to about 613,000, the lowest level since the start of the pandemic. That was a decline of 153,000, the largest week-over-week decrease since the summer.In addition, 132,000 new claims were filed for Pandemic Unemployment Assistance, a federal program that covers freelancers, part-timers and others who do not routinely qualify for state benefits. That was a decline of 20,000 from the previous week.“We’re gaining momentum here, which is just unquestionable,” said Diane Swonk, chief economist at the accounting firm Grant Thornton.There are also broader signs of a comeback.After a devastating year, airlines are growing increasingly hopeful as travelers return. Over the past month, more than one million people were screened each day at federal airport checkpoints, according to the Transportation Security Administration, a signal that a sustained travel recovery is underway.As a result, American Airlines said this week that it expected to sell more than 90 percent as many tickets within the United States this summer as it did in the summer of 2019. Delta Air Lines said Thursday that it had recovered about 85 percent of its domestic leisure sales. If trends hold, the airline said, it could be profitable again by the summer.“A year after the onset of the pandemic, travelers are gaining confidence and beginning to reclaim their lives,” Ed Bastian, the company’s chief executive, said in announcing the airline’s first-quarter financial results. “Delta is accelerating into the recovery.”Moreover, the nation’s ports are handling record cargo volumes as consumers stock up. March was the busiest month on record for the Port of Oakland, while the Port of Los Angeles, the main point of entry for goods from Asia, said the first three months of the year were the busiest first quarter in its 114-year history.“As more Americans get vaccinated, businesses reopen and the economy strengthens, consumers continue to purchase goods at a dizzying pace,” Gene Seroka, the port’s executive director, said in a statement.For months, the port, like others around the world, has been overwhelmed by an influx of cargo, forcing container ships to wait days offshore to unload their goods. In many cases, the containers are unloaded and immediately sent back so they can be filled for another eastbound trip. While the backlog remains, Mr. Seroka said, it is expected to be eliminated in the coming months.The Port of Los Angeles, the main point of entry for goods from Asia, said the first three months of this year were the busiest first quarter in its 114-year history.Coley Brown for The New York TimesThe improving signs on so many fronts are being reflected in brightening forecasts for the months ahead. Morgan Stanley said Thursday that it expected the economy to grow 7.5 percent in 2021, after shrinking 3.5 percent in 2020. That would be the strongest growth rate for a calendar year since the 1950s.But if the economy appears to be on the upswing, the recovery is still fragile. Weekly applications for unemployment claims have remained stubbornly high for months, causing frustration even as businesses reopen and vaccination rates increase. They have also been a volatile economic indicator, temporarily dipping to their lowest level of the pandemic in mid-March before rising again in recent weeks.“You’re still not popping champagne corks,” Ms. Swonk said. “I will breathe again — and breathe easy again — once we get these numbers back down in the 200,000 range.”What’s more, concerns about workplace safety persist, especially for younger workers who have just become eligible for vaccinations. Many children are still attending schools remotely, complicating the full-time work prospects for their caregivers.Jobless claims for the next few months could remain significantly elevated as the labor market adjusts to a new normal.“The job market conditions for job seekers have really improved extremely quickly between January and now,” said Julia Pollak, a labor economist at the job site ZipRecruiter. “But there are still huge barriers to returning to work.”The rebound in March sales also shows how consumer spending — and the economic rebound as a whole — remains highly dependent on government support.President Biden’s $1.9 trillion American Rescue Plan, which was signed into law last month, provides $1,400-a-person payments to most households. The payments began arriving around March 17, and by the end of the month, economists saw signs that spending was ramping up again, such as increased hotel occupancy and travel through airports.Economists at Morgan Stanley had predicted that core retail sales would jump 6.5 percent in March, driven by the payments. The investment bank said only 30 percent of consumers tended to spend their payments within 10 days, suggesting that many have money on hand that could strengthen April sales as well.Other factors are contributing to the brightening recovery prospects. Mr. Biden moved up the deadline for states to make all adults eligible for vaccination to April 19, and every state has complied, laying the groundwork for more people to rejoin the work force. Students who have been learning remotely are increasingly returning to the classroom, a shift that will especially benefit women, who have been disproportionately sidelined during the pandemic by caregiving duties.Echoing the general perception that post-pandemic life is beckoning, American consumers are feeling increasingly upbeat. One measure of sentiment, tabulated by the Conference Board, showed that consumer confidence in March recorded its biggest one-month gain in nearly a decade, fueled by increased income and stronger business and employment expectations.“This was the deepest, swiftest recession ever,” said Ms. Pollak, the ZipRecruiter economist. “But it’s also turning into the fastest recovery.”Ben Casselman contributed reporting. More

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    The Biden Administration Is Quietly Keeping Tabs on Inflation

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    A monthslong effort to monitor and model economic trends inside the White House and the Treasury Department found little risk of prices spiraling upward faster than the Fed can manage.WASHINGTON — Even before President Biden took office, some of his closest aides were focused on a question that risked derailing his economic agenda: Would his plans for a $1.9 trillion economic rescue package and additional government spending overheat the economy and fuel runaway inflation?To find the answer, a close circle of advisers now working at the White House and the Treasury Department projected the behaviors of shoppers, employers, stock traders and others if Mr. Biden’s plans succeeded. Officials as senior as Janet L. Yellen, the Treasury secretary, pored over the analyses in video calls and in-person meetings, looking for any hint that Mr. Biden’s plans could generate sustained price increases that could hamstring family budgets. It never appeared.Those efforts convinced Mr. Biden’s team that there is little risk of inflation spiraling out of the Federal Reserve’s control — an outcome that Wall Street analysts, a few prominent Republicans and even liberal economists like Lawrence H. Summers, the former Treasury secretary, have said could flow from the trillions being pumped into the economy.Traditional readings of price increases are beginning to turn upward as the recovery accelerates. On Tuesday, the Consumer Price Index rose 0.6 percent, its fastest monthly increase in more than a decade, while a less volatile index excluding food and energy rose a more muted 0.3 percent.But Mr. Biden’s advisers believe any price spike is likely to be temporary and not harmful, essentially a one-time event stemming from the unique nature of a pandemic recession that ruptured supply chains and continues to depress activity in key economic sectors like restaurant dining and tourism.The administration’s view mirrors the posture of top officials at the Fed, including its chairman, Jerome H. Powell, whose mandate includes maintaining price stability in the economy. Mr. Powell has said that the Fed expects any short-term price pops to be temporary, not sustained, and not the type of uptick that would prompt the central bank to raise interest rates rapidly — or anytime soon.“What we see is relatively modest increases in inflation,” Mr. Powell said in March. “But those are not permanent things.”Armed with their internal data and conclusions, administration officials have begun to push back on warnings that a stimulus-fueled surge in consumer spending could revive a 1970s-style escalation in wages and prices that could cripple the economy in the years to come.Yet they remain wary of the inflation threat and have devised the next wave of Mr. Biden’s spending plans, a $2.3 trillion infrastructure package, to dispense money gradually enough not to stoke further price increases right away. Administration officials also continue to check on real-time measures of prices across the economy, multiple times a day.“We think the likeliest outlook over the next several months is for inflation to rise modestly,” two officials at Mr. Biden’s Council of Economic Advisers, Jared Bernstein and Ernie Tedeschi, wrote on Monday in a blog post outlining some of the administration’s thinking. “We will, however, carefully monitor both actual price changes and inflation expectations for any signs of unexpected price pressures that might arise as America leaves the pandemic behind and enters the next economic expansion.”Some Republicans call that posture dangerous. Senator Rick Scott of Florida, the chairman of his party’s campaign arm for the 2022 midterm elections, has called on Mr. Biden and Mr. Powell to present plans to fight inflation now.“The president’s refusal to address this critical issue has a direct negative effect on Floridians and families across our nation, and hurts low- and fixed-income Americans the most,” Mr. Scott said in a news release last week. “It’s time for Biden to wake up from his liberal dream and realize that reckless spending has consequences, inflation is real and America’s debt crisis is growing. Inflation is rising and Americans deserve answers from Biden now.”Economic teams in recent administrations spent little time worrying about inflation, because inflationary pressures have been tame for decades. It has fallen short of the Fed’s average target of 2 percent for 10 of the last 12 years, topping out at 2.5 percent in the midst of the longest economic expansion in history.Shortly before the pandemic recession hit the United States in 2020, President Donald J. Trump’s economic team wrote that “price inflation remains low and stable” even with unemployment below 4 percent. As the economy struggled to climb out from the 2008 financial crisis under President Barack Obama, White House aides feared that prices might fall, instead of rise.“Given the economic crisis, we worried about preventing deflation rather than inflation,” said Austan Goolsbee, a chairman of the Council of Economic Advisers during Mr. Obama’s first term.The conversation has changed given the large amounts of money that the federal government is channeling into the economy, first under Mr. Trump and now under Mr. Biden. Since the pandemic took hold, Congress has approved more than $5 trillion in spending, including direct checks to individuals.Mr. Biden’s aides are sufficiently worried about the risk of that spending fueling inflation that they shaped his infrastructure proposal, which has yet to be taken up by Congress, to funnel out $2.3 trillion over eight years, which is slower than traditional stimulus.An outdoor mall in Los Angeles. Critics have warned that that a stimulus-fueled surge in consumer spending could revive a 1970s-style escalation in wages and prices that could cripple the economy in the years to come.Philip Cheung for The New York TimesEven before Mr. Summers and others raised economic concerns about Mr. Biden’s $1.9 trillion relief bill, officials were wrestling with their own worries about its inflation risks. They had internally concluded, with direction from Mr. Biden, that the biggest risk to the economy was going “too small” on the aid package — not spending enough to help vulnerable Americans survive continued stints of joblessness or lost income. But they wanted to know the risks of going “too big.”They tested whether an uptick in inflation might cause people and financial markets to expect rapid price increases in the years to come, upending decades of what economists call “well anchored” expectations for prices and potentially creating a situation where higher expectations led to higher inflation. They estimated the odds that the Fed would react to such moves by quickly and steeply raising interest rates, potentially slamming the brakes on growth and causing another recession.The informal group that initially gathered to research those questions included Mr. Bernstein; David Kamin, a deputy director of the National Economic Council; Michael Pyle, Vice President Kamala Harris’s chief economic adviser; and two Treasury officials, Nellie Liang and Ben Harris. More members have joined over time, including Mr. Tedeschi.The group reports regularly to Ms. Yellen and other senior officials including Brian Deese, who heads the N.E.C., and Cecilia Rouse, who leads the C.E.A. Its work has informed economic briefings of Mr. Biden and Ms. Harris.“The president and the vice president, their job is to deliver good economic outcomes for the American people,” Mr. Pyle said in an interview. “Part of what delivering strong economic outcomes to the American people means is ensuring that their team is fully on top of both the tailwinds to the U.S. economy but also the risks that are out there. And this is one of them.”Mr. Pyle and his colleagues looked at financial market measures of inflation expectations, including one called the five-year, five-year forward, which currently shows investors expecting lower inflation levels over the next several years than they expected in 2018.At the same time, officials at the Treasury’s Office of Economic Policy conducted a series of modeling exercises to “stress test” the virus relief package and how it might change those price and expectation measures if put in place. They considered scenarios where consumers quickly spent their aid money, which included $1,400 checks, or where they did not spend much of it at all right away. They talked with large banks about trends in customers’ cash balances and how quickly people were returning to the work force. Ms. Yellen, a former Fed chair, helped adjust the models herself.The exercises produced a wide range of possibilities for inflation. But they never suggested it would rise so rapidly that the Fed could not easily handle it by adjusting interest rates or other monetary policy tools. They saw no risk of a sharp return to recession — and no reason to pull back from spending proposals that administration officials believe will help the economy heal faster and help historically disadvantaged groups, like Black and Hispanic workers, regain jobs and income.“We’re going to see some heat in this economy,” Mr. Pyle said. “That heat is going to be good and redound to the benefit of wages and labor market conditions overall and particularly for a number of communities that have been at the margins of the labor market for too long.”If the data proves that forecast wrong, officials say privately, they will be quick to adapt. But they will not say how. If inflation were to accelerate in a sustained and surprising way, some officials suggest, the administration would trust the Fed to step in to contain it.There is no plan, as of yet, for Mr. Biden to consider inflation-fighting actions of his own. More

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    Beyond Pandemic’s Upheaval, a Racial Wealth Gap Endures

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    Billions in aid has been dispensed, and the social safety net has been reinforced. Will there be more ambitious steps to address longtime inequities?Not since Lyndon Baines Johnson’s momentous civil rights and anti-poverty legislation has an American president so pointedly put racial and economic equity at the center of his agenda.President Biden’s multitrillion-dollar initiatives to rebuild infrastructure in neglected and segregated neighborhoods, increase wages for health care workers, expand the safety net and make pre-K and college more accessible are all shot through with attention to the particular economic disadvantages that face racial minorities. So were his sweeping pandemic relief bill and Inauguration Day executive orders.Yet as ambitious as such efforts are, academic experts and some policymakers say still more will be needed to repair one of the most stubborn and invidious inequalities: the gap in wealth between Black and white Americans.Wealth — one’s total assets — is the most meaningful measure of financial strength. Yet for every dollar a typical white household has, a Black one has 12 cents, a divide that has grown over the last half-century. Latinos have 21 cents for every dollar in white wealth.Such disparities drag down the American economy as a whole. A study by McKinsey & Company found that consumption and investment lost because of that gap cost the U.S. economy $1 trillion to $1.5 trillion over 10 years, or 4 to 6 percent of the projected gross domestic product in 2028.Mr. Biden started talking about the wealth divide on the campaign trail, calling on the Federal Reserve to take on a new role and “aggressively target persistent racial gaps in jobs, wages and wealth.”Vice President Kamala Harris and several Democratic senators have supported proposals targeted specifically at the gap — from increasing Black homeownership to establishing trust accounts for newborns (“baby bonds”). And senior economic advisers who have joined the Biden team, including Cecilia Rouse and Jared Bernstein, have talked about the need for programs that attack structural inequities, noting that disparities in income over time create more entrenched gaps in wealth.Heather Boushey, a member of the White House Council of Economic Advisers, said the president’s proposals were intended to work together to make sure that unexpected or temporary economic jolts — like the loss of a job — didn’t snowball into a disastrous tumble.“No one thing alone is going to check the box to close the wealth gap, but the combination of all these things together will make real progress,” said Ms. Boushey, who has written frequently about the issue.Government support is crucial, economists say, because there is so little that individuals can do on their own to close the wealth gap. The most surprising finding that researchers at the Federal Reserve Bank of St. Louis established after a decade-long study of inequality and financial vulnerability was that no matter what financial decisions you make or schools you attend, roughly 80 percent of those yawning disparities are determined by your skin color, the year you were born and your gender.Median wealth of Black, Hispanic and white households

    Note: Figures adjusted for inflationSource: Federal Reserve Bank of St. LouisThe New York Times“There’s a lot you don’t control,” said Ray Boshara, who headed the research effort. “These larger forces really have an impact on your ability to accumulate wealth.”Imagine playing a game of Monopoly with a set of rigged rules. Your opponent gets $2,000 in cash, rolls with two dice at every turn, and earns $200 every time he circles the board and passes “Go.” You, by contrast, begin with only $1,000, roll with a single die and earn $100 at “Go.”At the game’s end, you can hand off whatever cash and property you’ve accumulated to a friend or family member, and the next round just continues.The rigged game helps explain the origins of the wealth gap. The heavy hand of a history studded by intimidation and terrifying violence, segregation and unfair housing, zoning and lending policies has prevented generations of Black families from gathering assets.In the 19th century, when the government distributed the country’s most realizable asset — land — during the Homestead Act, African-Americans were left out. In the 20th century, when the focus shifted to building a berth in the middle class through homeownership, African-Americans were again largely excluded from federal mortgage loan support programs and the G.I. Bill of Rights. Tax policies, in turn, favored the wealth-building strategies that were offered to whites.Even New Deal assistance programs like unemployment insurance that were created to help people survive the Depression excluded agricultural and domestic workers, who were overwhelmingly Black.Again and again, African-Americans were shut off from the capital that makes capitalism work.“That’s how we built the racial wealth gap,” said William A. Darity Jr., an economics professor at the Sanford School of Public Policy at Duke University. “Unless you have a comparable program focused on building Black wealth, you’re not going to do much about it.”Unequal outcomes in one generation turn into unequal opportunities in the next. Without assets, Black parents cannot offer as much financial support to help pay for their children’s education, first home or efforts to start a small business.Black graduates, for example, have to take out bigger loans to cover college costs, compelling them to start out in more debt — on average $25,000 more — than their white counterparts.Recognizing an uneven playing field is not as obvious as it might seem. The lopsided Monopoly rules were developed by social scientists at the University of California, Berkeley, nearly a decade ago as part of an experiment on money’s effect on human behavior.They found that winners consistently credited their hard-earned skills and smarts for their success rather than a skewed playing field.Research shows that outside forces prevent Black workers who are just as talented and hardworking from achieving the same success as their white peers.Harold M. Lambert/Getty ImagesThat all-too-human response clouds thinking about inequality, said Paul Piff, who led the research team and is now a psychologist at the University of California, Irvine.Americans, much more than people from other countries, interpret “their advantages in terms of things they themselves have earned or deserved as opposed to thinking it’s the result of an unfair world,” Professor Piff said. “Then the inequalities you’re seeing aren’t unfair, they’re just necessary outcomes of things that people did or didn’t do,” he said, so you are less willing to do anything about them.Mr. Boshara at the St. Louis Fed said the implications were particularly pertinent in thinking about the racial wealth gap.“People feel they’ve earned everything they have, but the evidence just doesn’t support that,” said Mr. Boshara, who is helping to lead a follow-up research initiative at the bank, the Institute for Economic Equity. “It counters the American narrative that everybody who has something made it on their own.”Challenging shibboleths about hard work and personal responsibility can meet resistance. People often take immediate offense, interpreting the argument as detracting from their own demonstrable hard work, skills and talent. What the research highlights, though, are the outside forces that prevent other individuals who are just as talented and hardworking from achieving the same success.The same house in a Black neighborhood will fetch less money than it would in a white one. A Black worker with the same credentials as a white colleague will earn less. Even among college graduates, the Black jobless rate tends to be twice as high as the rate for whites. Such inequities operate like an invisible tax on African-Americans, a tax on being Black.The pandemic has underscored how crushing unpredictable and uncontrollable twists in circumstances can be. When Congress approved the $1.9 trillion relief plan, Mr. Biden pointed out that millions of Americans were jobless and lining up at food banks “through no fault of their own.”“I want to emphasize that,” he added. “Through no fault of their own.”The pandemic has hit African-Americans and Latinos hardest on all fronts, with higher infection and death rates, more job losses, and more business closures.Proposals that confront the wealth gap head on, though, are both expensive and politically charged.Professor Darity of Duke, a co-author of “From Here to Equality: Reparations for Black Americans in the Twenty-First Century,” has argued that compensating the descendants of Black slaves — who helped build the nation’s wealth but were barred from sharing it — would be the most direct and effective way to reduce the racial wealth gap.Vice President Harris and Senators Bernie Sanders of Vermont, Elizabeth Warren of Massachusetts and Cory Booker of New Jersey have tended to push for asset-building policies that have more popular support. They have offered programs to increase Black homeownership, reduce student debt, supplement retirement accounts and establish “baby bonds” with government contributions tied to family income.With these accounts, recipients could build up money over time that could be used to cover college tuition, start a business or help in retirement.Several states have experimented with small-scale programs meant to encourage children to go to college. Though those programs were not created to close the racial wealth gap, researchers have seen positive side effects. In Oklahoma, child development accounts seeded with $1,000 were created in 2007 for a group of newborns.“We have very clear evidence that if we create an account of birth for everyone and provide a little more resources to people at the bottom, then all these babies accumulate assets,” said Michael Sherraden, founding director of the Center for Social Development at Washington University in St. Louis, which is running the Oklahoma experiment. “Kids of color accumulate assets as fast as white kids.”Without dedicated funds — the kind of programs that enabled white families to build assets — it won’t be possible for African-Americans to bridge the wealth gap, said Mehrsa Baradaran, a law professor at the University of California, Irvine, and the author of “The Color of Money: Black Banks and the Racial Wealth Gap.”She paraphrased a 1968 presidential campaign slogan of Hubert Humphrey’s: “You can’t have Black capitalism without capital.” More

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    New state unemployment claims rose again last week.

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    The job market remains challenging, with the government reporting Thursday that initial claims for state unemployment benefits rose last week.A total of 741,000 workers filed first-time claims for state jobless benefits last week, an increase of 18,000, the Labor Department said. It was the second consecutive weekly increase after new claims hit a pandemic low.At the same time, 152,000 new claims were filed for Pandemic Unemployment Assistance, a federal program covering freelancers, part-timers and others who do not routinely qualify for state benefits. That was a decline of 85,000.Neither figure is seasonally adjusted. Claims rose above one million early in the year but have come down since then, helped by the spread of vaccinations, the easing of restrictions on businesses in many states and the arrival of stimulus funds.Most individuals received payments of $1,400 in recent weeks as part of the Biden administration’s $1.9 trillion relief package, and the funds should bolster consumer spending in the coming months.On Friday, the government reported that employers added 916,000 jobs in March, twice February’s gain and the most since August. The unemployment rate dipped to 6 percent, the lowest since the pandemic began, with nearly 350,000 people rejoining the labor force.Still, there is plenty of ground to make up.Even after March’s job gains, the economy is 8.4 million jobs short of where it was in February 2020. Entire sectors, like travel and leisure, as well as restaurants and bars, are only beginning to recover from the millions of job losses that followed the pandemic’s arrival. More

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    To Build Support for Infrastructure Plan, Biden Offers His Own Take on ‘Bipartisan’

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    President Biden’s $2 trillion infrastructure proposal is a test of his belief that he can generate popular backing across the country as Republicans seek to block him on Capitol Hill.WASHINGTON — President Biden’s attempt to muscle through a $2 trillion plan to rebuild the country’s infrastructure — along with the tax increases to pay for it — will be a defining test of his belief that bipartisan support for his proposals can overwhelm traditional Republican objections in Congress.Instead of paring back his ambitions in an effort to limit opposition from Republicans in the Senate or appease moderate Democrats in the House, Mr. Biden and his allies on Capitol Hill are barreling ahead with unapologetically bold, expensive measures, betting that they can build bipartisanship from voters nationwide rather than from elected officials in Washington.Senator Mitch McConnell of Kentucky, the Republican leader, and other members of his party are working to brand the bill as a liberal wish list of wasteful spending and a money grab from a Democratic administration that will drag down the economy with tax hikes.But Mr. Biden is predicting that the broad appeal of wider roads, faster internet, high-speed trains, ubiquitous charging stations for electric cars, shiny new airport terminals and upgraded water pipes will undercut the expected barrage of ideological attacks that are already coming from Republican lawmakers, business groups, anti-tax activists and President Donald J. Trump.In his first cabinet meeting at the White House on Thursday, Mr. Biden directed several of his top officials to travel the country during the next several weeks to sell the benefits of the infrastructure spending. Jen Psaki, the White House press secretary, also told reporters that the president would host Democrats and Republicans in the Oval Office to discuss the plan and their ideas.“I hope and believe the American people will join this effort — Democrats, Republicans and independents,” Mr. Biden said in Pittsburgh on Wednesday as he formally announced his plan. He compared it to the popularity of the nearly $1.9 trillion pandemic relief bill that passed last month, saying, “If you live in a town with a Republican mayor, a Republican county executive or a Republican governor, ask them how many would rather get rid of the plan.”But generating sustained support for the proposal is shaping up to be a major challenge for the White House. The business lobby is preparing to wage a full-scale campaign against the tax increases in the president’s plan, with influential groups like the Business Roundtable and the U.S. Chamber of Commerce warning lawmakers against raising taxes as the United States emerges from a deep economic crisis caused by the coronavirus pandemic.But across the country, some local Republican officials are already embracing the prospect of millions of dollars in new infrastructure spending flowing into their communities, even as they are careful to express concern about new taxes.The president is betting that the broad appeal of wider roads, faster internet, high-speed trains, charging stations for electric cars, new airport terminals and upgraded water pipes will undercut the expected ideological attacks from Republicans.Todd Heisler/The New York TimesIn Fresno, Calif., Mayor Jerry Dyer said the president’s proposals, if passed into law, would allow the city to accelerate plans for a high-speed rail station linking it to job centers in the Bay Area. He said the city had struggled to electrify its fleet of buses and provide robust internet, especially to poorer communities.“These dollars are going to be welcomed in terms of repairing a lot of our infrastructure,” said Mr. Dyer, a Republican. He said he was concerned about the effects of higher taxes on businesses but added that he hoped the issue would be worked out in Washington.“There’s no question the need is there,” he said.Mayor John Giles of Mesa, Ariz., called the president’s proposal “a very good thing” for his city. With the money, Mesa could upgrade a 1970s-era airport tower, widen roads, extend broadband and expand a regional light rail network. He said he was disappointed by the Republican opposition in Congress.“It was only a few months ago that we all agreed that infrastructure was a bipartisan issue,” Mr. Giles said. “That attitude shouldn’t shift just because there’s a new administration in the White House.”But Gov. Larry Hogan of Maryland, another Republican who has called for a vast infusion of spending on infrastructure, accused Mr. Biden of using the legislation to advance $1.4 trillion in liberal programs.“It still has a lot of good things, but it also has a lot of things that have absolutely nothing to do with infrastructure,” Mr. Hogan said. “They’re like, ‘No, we just want to jam through all of our priorities.’”Mr. Biden and those closest to him understand that passage of the legislation will take place in Washington, not in Fresno or Mesa or Maryland. In announcing his plan, the president sought to cast congressional Republicans as longtime champions of infrastructure, both inviting them to negotiate and daring them to oppose his proposal.“We’ll have a good-faith negotiation with any Republican who wants to help get this done,” Mr. Biden said. “But we have to get it done.”That last line was a not-so-subtle hint about his legislative strategy. If the president cannot win backing from Republican lawmakers, Democrats appeared poised to once again use a parliamentary budget tool known as reconciliation to push through the tax and spending plan with a simple majority vote and most likely only Democratic support.At an event in his home state on Thursday, Mr. McConnell called Mr. Biden “a first-rate person” whom he liked personally. But he argued that the president was running a “bold, left-wing administration” and warned “that package that they’re putting together now, as much as we would like to address infrastructure, is not going to get support from our side.”For Mr. Biden, who spent more than three decades in the Senate, the political calculations are far different than they were 12 years ago, when a similar measure was under consideration.Senator Mitch McConnell of Kentucky, the Republican leader, warned that his conference would not support Mr. Biden’s proposal.Anna Moneymaker for The New York TimesPresident Barack Obama took office in 2009, in the middle of an economic crisis with a Senate firmly in Democratic control. Only weeks into his term, he pushed through an $825 billion stimulus bill devised to jump-start the economy — legislation that is now seen by many progressives as far too timid.Mr. Obama and his aides spent weeks feverishly negotiating with conservative Democrats and a handful of Republicans in Congress, who pressed the president to limit the size of the spending plan. Rahm Emanuel, Mr. Obama’s chief of staff at the time, said conservative Democrats like Senator Ben Nelson of Nebraska insisted that the president win Republican support.Mr. Biden appears to have taken from that experience the lesson that there are limited benefits from seeking to woo a small number of Republicans — and that the key is to sell the benefits of the plan to Americans and not get hung up on the process to pass it.“The politics was different, the policy was different, the public was different,” Mr. Emanuel said, praising Mr. Biden’s approach. Even before the president unveiled his plan, Republicans argued that Democrats were not genuinely interested in bipartisan negotiations, particularly after they pushed the pandemic relief package into law without any Republican votes.Senator Chuck Schumer of New York, the majority leader, has asked the Senate parliamentarian to offer guidance on how many times senators can pursue reconciliation this fiscal year, which several Republicans took as a sign that they were preparing to bypass the 60-vote filibuster threshold.“It is disingenuous for the president to invite Republicans to the White House and the Oval Office to discuss this when he’s made it very clear — and Democrats in Congress have made it very clear — they have no intention of working with Republicans on this package,” said Representative Kevin Brady of Texas, the top Republican on the House Ways and Means Committee.In an interview, Senator Susan Collins, Republican of Maine, said she appreciated the outreach from the administration leading up to Mr. Biden’s announcement, including multiple bipartisan briefings for lawmakers and individual conversations with cabinet officials.But Ms. Collins, a member of a bipartisan Senate group that is eager to strike compromises on a number of issues, said bipartisan negotiations would most likely falter if the administration refused to budge on the overall price tag or composition of the package.Senator Susan Collins said she appreciated the outreach from the administration leading up to Mr. Biden’s announcement.Anna Moneymaker for The New York Times“Everyone knows what bipartisanship means: It means that you get members of Congress from both parties working on and voting for important legislation,” she said, adding: “It’s not like it’s some relic of ancient times. We acted in a bipartisan manner on the most important issue last year: the pandemic.”If Democrats are already considering using reconciliation, Ms. Collins said, “that raises questions about whether there is a sincere interest in crafting a bipartisan infrastructure package.”Some Democrats have said that the proposal is not enough to address both infrastructure needs and inequities across the country, and they have counseled the White House against winnowing down a legislative package to win a handful of Republican votes.“I’m not particularly hopeful that we’re going to see a giant awakening from Republicans who decide that they want to pass an infrastructure package that actually addresses climate,” Representative Pramila Jayapal of Washington, the chairwoman of the Congressional Progressive Caucus, told reporters before Mr. Biden’s speech. More