In late March, President Joe Biden’s White House issued a press release titled “FACT SHEEET: The American Jobs Plan.” It stated that, on top of already-passed “American Rescue Plan,” the American Jobs Plan would be “an investment in America that will create millions of good jobs, rebuild our country’s infrastructure, and position the United States to out-compete China.”
The release identified six main goals for the Plan, including one to “solidify the infrastructure of our care economy by creating jobs and raising wages and benefits for essential home care workers.”
This goal and related initiatives have drawn attention, and some criticism, for stretching the traditional meaning of infrastructure.
This could be more than just a sales pitch.
Accounting is about numbers, but it is also about words. What is a “capital asset,” for example? Might calling new things “infrastructure” have implications for accounting for dollar outflows? For state and local governments, could it matter for expenses or expenditures if spending on infrastructure that includes home care is capitalized?
In 2019, the Governmental Accounting Standards Board (GASB) added a project called “Capital Assets” to its research agenda. It identified how different jurisdictions followed different practices, for example, in choosing whether or not to capitalize and depreciate infrastructure spending.
This GASB project is still in the early stages, but GASB has development work planned for later this year. This project bears watching, together with future developments in how our federal, state and local governments spend on “infrastructure” in the “American Rescue Plan.”
You can see a more complete (one-hour) discussion of the Biden Administration’s infrastructure plan that we recently had with energetic, entertaining and informative Steven Malanga here.