Janet Yellen has said US companies would see higher profits and greater competitiveness under Joe Biden’s $2.3tn infrastructure plan, in a bid to overcome corporate America’s scepticism as the package moves through Congress.
In a speech at the US Chamber of Commerce on Tuesday, Yellen called on top US executives to embrace Biden’s sweeping infrastructure bill in spite of the increase in the US corporate income tax proposed to fund it.
“We are confident that the investments and tax proposals in the Jobs Plan, taken as a package, will enhance the net profitability of our corporations and improve their global competitiveness,” Yellen said, according to remarks released by the US Treasury department ahead of the speech. “We hope that business leaders will see it this way and support the Jobs Plan.”
Yellen’s intervention comes as negotiations between the White House and Republicans on Capitol Hill over a compromise deal are heating up.
Republican senators are expected on Tuesday to raise their offer for an infrastructure spending package from $568bn to roughly $800bn — still a far cry from Biden’s ambitions.
Republicans not only oppose Biden’s spending levels, but also are in tune with business opposition to the corporate tax increases. If no deal is reached on a bipartisan package, Biden could attempt to pass the legislation solely with Democratic support. Such a manoeuvre would require a compromise with moderate members of his own party, however, which could also prove thorny.
Speaking to the US Chamber, the largest business lobby group, Yellen cast Biden’s package as a pragmatic way to upgrade the American economy in the aftermath of the pandemic.
“It 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,” she said.
“We’re proposing smart investments — to make our economy more competitive and sustainable, to provide opportunities for all families and workers, and to make our tax system fairer.”