Biden to shift from Build Back Better bill to 4-point economic rescue plan

The administration estimates that rising shipping costs will add 1 per cent to consumer prices over the coming year. PHOTO: REUTERS

WASHINGTON (REUTERS) - United States President Joe Biden will shift emphasis away from his Build Back Better spending plan when he delivers his State of the Union address on Tuesday (March 2), focusing instead on a four-point plan to save the US economy, administration officials said.

"It's not about the name of the bill," said an administration official.

"It's about the ideas. It's about lowering costs for families."

Dominating the news is Russia's invasion of Ukraine, a crisis that has redirected Biden's attention from the administration's effort to revive his domestic economic agenda ahead of Nov 8 congressional elections.

Yet, with his approval ratings wilting, Mr Biden is retooling his push for broad tax-and-spending changes in a new way.

Many of the policies he promotes will seem familiar - raising Pell grants for education, raising the federal minimum wage to US$15 (S$20) and creating a national paid family medical leave program - but the messaging is different.

"The president will call on Congress to send him a bill that lowers costs and lowers the deficit without delay," the White House said in a preview of the speech.

"American families need relief from higher costs, and they need it now."

Out is talk of remaking society with a Build Back Better social-spending agenda.

In is talk of restraining deficits and putting an end to inflation, two of the concerns that Democrat Joe Manchin, the swing vote in the US Senate, thought the administration had failed to emphasise enough.

Mr Manchin's opposition tanked a package of Mr Biden economic reforms that were aimed at working women and families, paring down the country's massive income inequality and meeting climate goals.

Mr Biden's speech will call for many of the reforms on housing, education and climate to be passed under the rubric of a four-point plan: Moving goods cheaper and faster; reducing everyday costs; promoting competition; and eliminating barriers to jobs.

Mr Biden will commit to a number of initiatives related to his $1 trillion bipartisan infrastructure bill, including repairing 105,000km of roads and 1,500 bridges.

He also will ask Congress to complete work on bills he hopes will make the U.S. economy more competitive against China.

Mr Biden will also argue that ocean shipping is dominated by a small number of foreign-owned companies which are increasing costs too much and announce steps by agencies including the Department of Justice to promote competition in that space.

The administration estimates that rising shipping costs will add 1 per cent to consumer prices over the coming year.

He will also announce plans to increase safety inspections at nursing homes to reduce their cost and bad patient outcomes, especially those owned by private equity firms. He also wants the federal government to hire more people based on their skills instead of educational qualifications alone.

Rising costs have threatened the economic recovery from the coronavirus pandemic and undermined Biden's favourability with voters as a steward of the economy.

In the 12 months through January, the CPI jumped 7.5 per cent, the biggest year-on-year increase since February 1982.

Mr Biden's approval rating, meanwhile, sits at 43 per cent, which is close to the lowest level of his presidency according to Reuters/Ipsos polling.

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