10 minute read 7 May 2021
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Biden’s first 100 days: 8 key public policy issues and what’s ahead

Authors
Bridget Neill

EY Americas Vice Chair, Public Policy

Regulatory and policy strategist. Three decades in shaping public policy impacting global financial markets and accounting profession. Passionate about family. Outdoor sports enthusiast.

John D. Hallmark

Ernst & Young LLP Principal, Public Policy, and US Political and Legislative Leader

Public policy professional with a deep understanding of the Washington legislative and political arenas. Works with key stakeholders to formulate and execute on the firm’s policy initiatives.

10 minute read 7 May 2021

The Biden Administration’s actions and congressional developments put a spotlight on key public policy issues.

In brief

  • President Joe Biden’s first 100 days played out before a backdrop of challenges that are likely to drive the administration’s agenda.
  • The EY Office of Public Policy provides a snapshot of the Biden Administration’s actions on eight key public policy issues.
  • We offer insights on what to expect next related to these key public policy issues and business considerations based on the administration’s actions to date.

Since President Franklin Delano Roosevelt brought the term “first 100 days” into the US political lexicon nearly 90 years ago, stakeholders and constituents have tracked what actions and approaches an incoming president takes and what an administration achieves in this milestone time frame. President Joe Biden’s first 100 days played out before a backdrop of challenges, including the ongoing COVID-19 pandemic, renewed calls to address racial inequity, immigration and border issues, and the political dynamics created by a 50-50 Senate. These challenges, along with the convergence of market forces and several Biden Administration priorities, are likely to drive the administration’s agenda.

In line with his campaign pledges, Biden focused the early days of his administration on addressing the health and economic repercussions of the pandemic, instituting policies that engender equity, and bringing a whole-of-government approach to advancing climate and sustainability policies and efforts.

The Ernst & Young LLP Office of Public Policy provides a snapshot of the Biden Administration’s actions on eight key public policy issues, including executive actions, congressional developments and prominent personnel appointments during the 100-day period that ended April 29. Additionally, we offer insights about what to expect next related to these key public policy issues and business considerations, based on the administration’s actions to date.

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Key issue #1

COVID-19 pandemic

Driving both an economic and public health recovery has been Biden’s top priority since entering office.

Biden’s chief focus upon taking office was to get the COVID-19 pandemic under control as quickly as possible so he could also address the accompanying economic fallout and, ultimately, turn to the other two pillars of his administration’s four urgent policy priorities: climate change and racial inequity.

On his first day in office, Biden issued a flurry of executive orders and actions aimed at arresting the spread of COVID-19 (including federal mask mandates and testing and supply chain enhancements), bolstering the US response (such as extending support for using the National Guard in the COVID-19 response, maximizing assistance of the Federal Emergency Management Agency, improving and expanding access to care and treatments, and organizing a unified government response) and supporting the economy (including pausing federal student loan payments, mandating protection measures for the federal workforce, supporting the reopening and operation of schools, protecting worker health and safety, and encouraging the use of goods and services produced in the US). As he has approached and continues to approach most significant policy areas, Biden has engaged a whole-of-government approach to tackling and turning the tide on the COVID-19 pandemic.

On his 50th day in office, Biden signed into law the American Rescue Plan Act (ARPA), a $1.9 trillion economic relief and COVID-19 response package, bringing the federal government’s total response to about $5.5 trillion via six wide-ranging bills spanning approximately one year. With the ARPA in place, Biden and congressional Democrats have expressed a desire to turn to a broader, long-term economic growth and recovery proposal — Biden’s Build Back Better recovery plan, anchored in a broad and comprehensive infrastructure package.

Key executive actions

 

Key congressional actions during Biden’s first 100 days

 

Select key personnel confirmed

Other key appointments (confirmation not required):

  • Dr. Anthony Fauci, Chief Medical Advisor to the President on COVID-19
  • Jeffrey Zients, COVID-19 czar
  • Marcella Nunez-Smith, COVID-19 Equity Task Force Chair
  • Biden’s COVID-19 Response Team

 

What to watch

Six pieces of COVID-19 legislation, including numerous provisions for health care, nutrition, welfare, education, unemployment, business, tax, finance, transportation and housing, are set to expire during 2021. Such provisions include expanded unemployment insurance; the Paycheck Protection Program; grants for shuttered venue operators; emergency Economic Injury Disaster Loan grants; certain payroll, paid leave and tax credits; eviction and foreclosure moratoriums; and rental assistance. As these various deadlines approach, Congress and Biden will face decisions about what relief may still be necessary based on the COVID-19 situation and the state of the economy, as well as the political dynamics in Washington and other policy priorities.

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Key issue #2

Infrastructure

The focus now turns to a long-term economic growth and recovery proposal anchored in a broad and comprehensive infrastructure package.

Following the enactment of the $1.9 trillion ARPA, Biden outlined his infrastructure investment strategy for economic growth and job creation. The administration has divided the Biden campaign’s Build Back Better plan for economic stimulus into two proposals: physical infrastructure, manufacturing and R&D funding (American Jobs Plan or AJP); and human infrastructure, which includes proposals aimed at individual Americans and their families, such as universal pre-kindergarten, tuition-free community college and a national paid family leave program (American Families Plan or AFP).The combined proposals are expected to cost about $4.5 trillion over the next 10 years and align with the central pillars of the Biden Administration (e.g., a focus on income inequality, racial and gender equity, climate and a Made in America industrial policy).

Congress historically¹ (e.g., the 2009 American Recovery and Reinvestment Act, the 1933 New Deal) has pursued investments in US physical infrastructure as a bipartisan undertaking. However, the two parties currently disagree on the size and scope of the administration’s proposals. A consensus is attainable for broadband access funding and investments in surface and water transportation projects, but the inclusion of “green energy” provisions, non traditional infrastructure policies and particularly the associated tax “pay-fors” could make this a partisan exercise. In addition, both parties have warned of spending fatigue in considering the comprehensive infrastructure legislation after about $5.5 trillion in COVID-19 relief spending over the past year.

As the Biden Administration works to solidify its proposals for economic stimulus, Congress has begun to develop its surface transportation reauthorization bill (the current law is set to expire September 30). Democrats want the reauthorization bill to be included in the AJP proposal, but this could prove challenging as most reauthorization priorities — including transfers into the Highway Trust Fund — cannot be advanced through budget reconciliation, which likely would have to be leveraged to pass the AJP.

Key executive actions
  • AJP proposal
  • AFP proposal 

 

Key congressional actions during Biden’s first 100 days
  • ARPA (P.L. 117-2) provided funding for state and local infrastructure projects and $7 billion for broadband.
  • House Transportation & Infrastructure Committee held a hearing on “The Administration’s Priorities for Transportation Infrastructure
  • Senate Banking and House Financial Services Committees held several hearings related to investments in affordable housing

 

Select key personnel confirmed
  • Pete Buttigieg, Secretary of Transportation
  • Polly Trottenberg, Deputy Secretary of Transportation
  • Marcia Fudge, Housing and Urban Development (HUD)  Secretary

Other key appointments (confirmation not required):

  • Gina McCarthy, White House National Climate Advisor

 

What to watch

Infrastructure will be at the center of the legislative agenda for the rest of 2021. Speaker Nancy Pelosi (D-Calif.) said she would like the House of Representatives to pass the AJP and the corresponding Made in America Tax Plan by July 4, but acknowledged that the timeline could slip into August. The AFP will likely be a priority in late 2021 and into early 2022.

Biden has said he wants infrastructure legislation to be bipartisan, but signaled that he would move forward with budget reconciliation if necessary, which would require only Democratic support. At this point, Republicans support a smaller, more focused bill without tax increases. In April, Senate Republicans offered a $568 billion infrastructure counter proposal, which includes $299 billion for roads and bridges and billions more dollars to fund public transit, airports, broadband and other physical infrastructure. Democrats are facing their own challenges as divisions intensify over proposed corporate and individual tax hikes. (See additional insights on the tax outlook.)

The administration has committed to continue meeting with Republicans and business groups in a bid for support. This still is the beginning of the process, and both the AJP and AFP proposals will likely change over time to accommodate current objections.

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Key issue #3

Tax

The administration has proposed corporate and individual tax increases to help pay for its infrastructure plan, which will be subject to negotiations in Congress.

The ARPA included several tax provisions as pay-fors, such as an expansion of executive compensation tax limitations; however, that doesn’t apply until after 2026. Many of the tax increase proposals that Biden discussed on the campaign trail have been proposed as part of the president’s AJP and AFP infrastructure and economic stimulus proposals, including tax provisions targeting corporations.

The AJP was proposed alongside the Made in America Tax Plan, which would increase the corporate tax rate to 28%, impose a new 15% minimum tax on corporations on book income over $2 billion and modify the international provisions of the 2017 Tax Cuts and Jobs Act (TCJA) by:

  • Doubling the global intangible low-tax income rate, restructuring it so that it is calculated on a country-by-country basis and eliminating the qualified business asset investment
  • Replacing the base erosion and anti-abuse tax
  • Eliminating foreign-derived intangible income

Members of Congress have put forward similar proposals, but none have put Biden’s exact plan into legislative text, and the expectation is that Congress will make changes to the administration’s proposal. It remains to be seen whether most or any of these tax increases can be enacted — there currently is no Republican support for tax hikes, so it would likely need solely or mostly Democratic support under budget reconciliation — and a current focus is on dropping the corporate rate target to 25%.

 AFP-proposed tax changes for individuals include:

  • Increasing the top tax rate on the wealthiest Americans to 39.6%
  • Increasing the capital gains rate to 39.6% for households making over $1 million
  • Eliminating the step-up basis on inherited property
  • Eliminating carried interest
  • Ending Section 1031 like-kind exchanges for gains greater than $500,000
  • Applying the 3.8% Medicare tax on earnings consistently to those making over $400,000, which could mean applying the 3.8% tax to active income earned in businesses like S corporations and partnerships

On the global tax front, Treasury Secretary Janet Yellen has repeatedly called for a global minimum tax, which is the basis of the Organisation for Economic Co-operation and Development (OECD) Base Erosion and Profit Shifting 2.0 Pillar Two proposal and figures prominently in the Made in America Tax Plan. Yellen has said that a global minimum tax is necessary to forestall a continuing “race to the bottom” among nations to compete for business by lowering corporate rates. The BEPS 2.0 project overall, Pillars One and Two, aim to prevent other nations from imposing unilateral digital services taxes that would primarily affect large US technology companies. 

Key executive actions

 

Key congressional actions during Biden’s first 100 days
  • Senate Finance manufacturing hearing (WCEY)
  • Senate Finance international hearing (WCEY)
  • Sens. Ron Wyden (D-Ore.), Sherrod Brown (D-Ohio) and Mark Warner (D-Va.) released an international tax framework

 

Select key personnel confirmed

 

What to watch

The outlook for tax changes will depend on a variety of factors, including whether Republicans can agree to any tax increases and which tax increases Democrats will agree to on their own, and if the AJP or the AJP and the AFP move through Congress separately or together via budget reconciliation. Many members of Congress are advocating for a 25% corporate rate, but it is unclear whether Biden will push for a higher rate. The Treasury Department and some congressional Democrats have argued that the TCJA’s international provisions are encouraging offshoring of jobs, and while their prescribed fixes have many overlaps, there are also differences in their approaches. As House Ways and Means Committee Chairman Richard Neal (D-Mass.) has noted, significant differences in views exist among House Democrats on the international tax issue. Democrats, therefore, are expected to champion some, but not all, of Biden’s tax increase proposals. There also are two TCJA-related “cliffs” at the end of 2021, with changes related to the Section 163(j) interest deductibility and the Section 174 research and development amortization set to take effect in 2022, and significant business community and bipartisan congressional support for preventing these provisions from sunsetting.

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Key issue #4

Social justice and racial equity

Advancing equity is a central focus of the administration’s actions. Policy debates around social justice will continue as events transpire.

Biden’s first 100 days in office have prioritized social justice and racial equity, including by assembling the most diverse Cabinet in US history. Out of the gate on Inauguration Day, Biden signed an executive order launching a whole-of-government effort to advance racial equity, saying it was necessary to “restore the soul of the nation.” Since then, advancing equity and ending systemic racism have become a central theme of administration actions, and more than a stand-alone policy issue. 

Biden Administration proposals, such as the ARPA and the AJP, have established equity as a key component, directing billions of dollars to underserved communities and populations. The administration also has taken unilateral action to strengthen anti-discrimination housing policies, halt new Justice Department contracts with private prisons, increase the sovereignty of Native American tribes, and respond to violence and xenophobia against Asian-Americans and Pacific Islanders.

In step with the administration’s focus on the impact of climate change, Biden also has included the need to address environmental justice as part of the climate change discussion. In an executive order, the administration established a White House Environmental Justice Interagency Council “to prioritize environmental justice and ensure a whole-of-government approach to addressing current and historical environmental injustices.” The order also initiates the development of a climate and environmental justice screening tool to identify disadvantaged communities and inform “equitable decision-making across the federal government.”

Recent incidents of violence against members of the Asian-American and Pacific Islander community, a wave of state voting law changes and a revival of protests related to police violence have heightened the Biden Administration’s focus on social justice policy. In March, the House of Representatives passed legislation related to voter access and police reform, but both bills remain stalled in the Senate. Nevertheless, the policy debate around social justice is expected to continue as events continue to transpire across the nation. 

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Key executive actions
  • Executive Order on Advancing Racial Equity and Support for Underserved Communities Through the Federal Government
  • Executive Order on Promoting Access to Voting
  • Memorandum Condemning and Combating Racism, Xenophobia, and Intolerance Against Asian Americans and Pacific Islanders in the United States
  • Presidential Memorandum on Redressing Our Nation’s and the Federal Government’s History of Discriminatory Housing Practices and Policies

 

Key congressional actions during Biden’s first 100 days

 

Select key personnel confirmed

Given the administration’s all-of-government approach to advancing social justice and racial equity, personnel across numerous agencies will impact this public policy area. Here are a few who historically have had a prominent role in addressing these matters:

  • Marcia Fudge, HUD Secretary
  • Kristen Clarke, Assistant US Attorney General, Civil Rights Division

Other key appointments (confirmation not required):

  • Susan Rice, White House Domestic Policy Council Advisor
  • Gay McDougall, US Representative to the Committee on the Elimination of Racial Discrimination
  • Erika Moritsugu, White House liaison to Asian-American and Pacific Islander Community
  • Wally Adeyemo, Deputy Treasury Secretary

 

What to watch

Social justice and racial equity are expected to remain major considerations in most every decision under the Biden Administration. The White House has endorsed House-passed legislation on voter access and police reform, even calling for its passage in the president’s joint address to Congress. However, that particular legislation is not expected to receive the necessary support for passage in the Senate. Recent high-profile court proceedings and allegations of police misconduct will likely impact the consideration of policy proposals in the administration aimed at reforming law enforcement. However, absent congressional action, Biden will continue seeking policy change through executive measures that are likely limited in their scope and power.

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Key issue #5

Environment and climate

Environmental considerations will remain at the forefront of the debate in Washington as Congress and the administration negotiate the AJP.

From his first day in office, Biden has focused on executing his campaign promise to make environmental protection a centerpiece of his administration.

As with other policy priorities as articulated above, the administration sees a role that every agency will play in combating climate change — adopting a whole-of-government approach to environmental protection that extends beyond agencies like the Environmental Protection Agency. Financial regulators, as noted below, are demonstrating that focus by appointing high-level staff specifically to address the climate crisis within the missions of their agencies, as well as considering climate-related disclosures that could impact investors and investments.

Notably, in a sweeping executive order issued in his first week in office, the president set in motion a government-wide review of climate policy. Under the direction of the newly created National Climate Task Force, 21 federal agencies coordinated to develop the administration’s Climate Finance Plan, which was released on Earth Day, April 22. The plan is aimed at bolstering adaptation and increasing the resilience to the impacts of climate change through commitments to double the US’ climate financing to developing countries by 2024 relative to the second half of the Obama Administration and triple its adaptation funds in the same time frame. While specific funding details did not accompany the plan, it and other agency reviews mandated under the executive order are likely to establish the record that the Biden Administration will use to enact new environmental regulations once the administration is staffed and running at full speed.

Biden and his administration are also re-engaging on the world stage and inserting environmental considerations into foreign relations, as evidenced by the Leaders Summit on Climate hosted by the president on April 22 and 23. The virtual summit attended by 40 world leaders, along with dozens of government, business and civil society leaders, was meant to reassert US leadership in addressing climate change and to encourage additional commitments to reduce carbon emissions ahead of the 2021 UN Climate Change Conference (COP26) in November. In coordination with the event, Biden announced that the US would seek to cut greenhouse gas emissions in half by 2030. This more than doubles the US commitment under the 2015 Paris Climate Agreement and sets the country on course to net-zero emissions by mid-century. The administration also announced the Greening Government Initiative, a joint effort with Canada to transition to net-zero government operations, which is meant to serve as a model for other countries.

Of course, many of the administration’s goals will need to be implemented by legislation, which may prove difficult to enact given the 60-vote threshold for passage generally required in the Senate.

Key executive actions

 

Key congressional actions during Biden’s first 100 days
  • House and Senate committees held a large number of hearings on the impact of climate change on everything from the financial system and farming to environmental justice and job creation.
  • Protecting America’s Wilderness and Public Lands Act passed the House on February 26; no Senate consideration to date

 

Select key personnel confirmed

Given the administration’s all-of-government approach to addressing climate issues, personnel across numerous agencies will impact this public policy area. Here are a few that historically have had a prominent role in addressing these matters:

Other key appointments (confirmation not required):

  • John Kerry, Special Presidential Envoy for Climate
  • John Morton, Climate Counselor at the Department of the Treasury
  • Melanie Nakagawa, Senior Director for Climate and Energy, National Security Council
  • Robert Bonnie, Deputy Chief of Staff for Policy and Senior Advisor, Climate, at the Department of Agriculture

 

What to watch

Climate change and environmental protection will continue to be at the forefront of the debate in Washington as Congress and the administration negotiate a proposed spending package aimed and rebuilding America’s infrastructure and creating jobs to aid in the post-COVID-19 economy. As proposed by the president, the AJP contains numerous provisions aimed at retrofitting existing infrastructure with green technologies, as well as new initiatives, such as:

  • Creating a nationwide network of electric vehicle charging stations
  • Replacing diesel vehicles in federal and state government fleets
  • Expanding and modernizing transit systems
  • Efforts at increasing the resiliency of the electrical grid, hospitals, roads, etc.
  • Providing tax credits for clean energy generation and storage
  • Investing in 15 decarbonized hydrogen demonstration projects

The president’s proposal has been met with some criticism from both sides of the political spectrum — with some suggesting the $2.65 trillion price tag is too high, with others arguing that it does not go far enough. By utilizing special Senate procedures applicable to reconciliation bills, Biden may be able to get large portions of the AJP enacted with only Democratic support in Congress. However, tax provisions proposed by the president (such as raising the corporate tax rate to 28%) are likely to cause dissention even among some Democrats in Congress. Negotiations on the package will continue in the coming months, with consideration by the full House and Senate expected in the fall.

At the same time, Congress will be considering the annual budget and appropriations bills that fund the federal government. The president’s top-line FY 2022 budget request, released on April 9, serves as a window into the administration’s policy and spending priorities for the upcoming year, and indicates its intention to continue focusing government resources on protecting the environment and addressing climate change. Biden’s request calls for a $14 billion increase in federal climate programs, $10 billion of which would be targeted at clean energy innovation. The budget request would also provide funds to help transition the federal government itself to clean energy, with $600 million requested for the purchase of electric vehicles for federal agencies and departments and $800 million for increasing the energy efficiency of public housing. Biden’s budget also requests that the US resume contributions to the United Nations Green Climate Fund, setting aside $1.2 billion in climate aid for poor nations.

With the president’s top-line budget request in hand, Congress will begin the lengthy process of allocating funding for the upcoming fiscal year. By law, the appropriations process must be completed by September 30. However, in recent years, appropriations bills generally have been enacted in the waning hours of the congressional session each December — if not later — thus, ensuring that debate about environmental issues will continue in Congress throughout 2021, while federal agencies and regulators continue their rulemaking processes on issues ranging from carbon emissions to environment, social and corporate governance (ESG) disclosures.

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Key issue #6

Trade and supply chain

The administration has focused on a comprehensive review of existing trade policy while seeking to re-establish cooperation with traditional allies.

The early days of the Biden Administration have been characterized by a comprehensive review, rather than a change in existing trade policy at the outset. This has meant a certain amount of continuity, such as maintaining Section 232 tariffs on aluminum and steel imports that were put in place by the Trump Administration. Reflecting the strong bipartisan skepticism of China in Congress, the administration also has maintained efforts to restrict trade and commerce with China, including by leaving in place Section 301 tariffs on Chinese imports and implementing Trump Administration rules that allow governmental review of technology-related transactions involving parties from China and certain other countries. For its part, Congress is considering major legislation to enhance the US’ competitiveness with China, including through investments in US manufacturing, science and technology, and supply chains, as well as strengthening cooperation with allies on economic, security and human rights matters.

Biden and US Trade Representative Katherine Tai have strongly emphasized that US trade policy will focus on providing benefits to American workers and addressing climate change. They also have suggested that expanding international trade through trade negotiations is not among the administration’s short-term goals. The administration has not signaled plans to continue trade negotiations initiated by the Trump Administration or to begin new ones. Rather, the administration is emphasizing US manufacturing and production by putting in place a Buy American federal procurement plan, which places new restrictions on US Government purchases of foreign products and services. In addition, Biden issued an executive order to develop recommendations for enhancing the resilience and capacity of US supply chains necessary for US national security and emergency preparedness, which could result in policies to encourage reshoring of manufacturing.

Where the Biden Administration has shifted its approach compared with the previous administration is in respect to multilateralism and international cooperation. The US Government under Biden is seeking to re-establish cooperation and goodwill with traditional allies, such as the EU, on a number of fronts, including addressing China’s trade practices. To this end, the administration has taken actions such as pausing tariffs imposed on EU imports due to the Boeing-Airbus dispute in the World Trade Organization (WTO), while the two jurisdictions negotiate a settlement. The administration also is making a concerted effort to recast US participation in global organizations, such as by endorsing the consensus candidate for WTO director-general, agreeing with other countries to boost International Monetary Fund resources by $650 billion and re-engaging in OECD negotiations on a multinational tax framework. On the geopolitical front, the US Government has begun engaging with partners such as Australia, India and Japan to counter China’s growing economic and military influence. Additionally, Biden will soon begin to name key ambassadorships that will be critical to building the alliances and coalitions he is seeking to establish. 

Key executive actions
  • Supply Chain executive order
  • Buy American executive order
  • Sanctions on Chinese officials over aspects of the Xinjiang and Hong Kong situations
  • President Biden convened a March 12 summit with industry CEOs and the National Security Agency, National Economic Council and Department of Commerce to emphasize the supply shortage in semiconductors needed for computerized electronics, including in the auto and national security sectors. This follows a February 24 executive order mandating a review of critical supply chains, including semiconductors.

 

Key congressional actions during Biden’s first 100 days

Under consideration:

  • Endless Frontier Act, which aims to boost US competitiveness with China through a $100 billion investment in US manufacturing, science and technology, supply chains and semiconductors
  • Strategic Competition Act, which aims to bolster diplomatic strategy in addressing challenges posed by the Chinese Government
  • National Manufacturing Guard Act, which establishes an Office of Supply Chain Preparedness in the Department of Commerce that would be responsible for preparing for future crises that would threaten the ability to produce or obtain critical resources
  • Senate Finance Committee hearing on US-China relations: “Improving US Competitiveness Through Trade”

 

Select key personnel confirmed
  • Antony Blinken, Secretary of State
  • Gina Raimondo, Secretary of Commerce
  • Katherine Tai, US Trade Representative
  • Kurt Campbell, National Security Council Asia Coordinator

 Pending Senate confirmation:

  • Deputy US Trade Representative Sarah Bianchi
  • Deputy US Trade Representative Jayme White

 

What to watch 

Regarding broader trade policy, in addition to defining its worker-centered approach to trade, the administration also can be expected to articulate how trade policy could help achieve the goal of mitigating climate change. Two areas that Tai already has flagged for attention are trade rules that facilitate companies’ ability to shift manufacturing to countries with lower environmental standards, and global trade’s role in fostering innovations that will help mitigate climate change. With its labor and environmental priorities, the administration can be expected to consider enforcement actions against trading partners that it views as not living up to existing trade commitments. One early candidate for such an action is Mexico, which has come under scrutiny by Congress and the business community over concerns about Mexico meeting its obligations under the United States-Mexico-Canada Agreement.

The US-China bilateral relationship will continue to be a major priority, with ongoing US actions to respond to what Washington views to be unfair trade practices, situations in China’s Xinjiang province and increasing territorial issues involving China. As the US government re-engages with international organizations, such as the World Health Organization (WHO) and the WTO, it also will seek leadership roles, in part to counter what it views to be China’s increasing influence in these organizations. Outside of the administration and Congress seeking to compete with China, more significant shifts are expected in trade and supply chain policies in the coming months as the Biden Administration finishes its reviews of key policy areas and moves to implementation.

Another area to watch is how the Biden Administration supports global vaccination efforts going forward, such as by expanding efforts to share vaccine stockpiles and raw materials for the production of vaccines and seeking ways to encourage increased vaccine production. The Biden Administration recently announced support for a waiver to certain provisions of the WTO’s Trade-Related Aspects of Intellectual Property Rights agreement for COVID-19 vaccines. The US has come under increasing pressure in recent weeks to assist countries experiencing COVID-19 outbreaks.

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Key issue #7

Technology

Technology is likely to be included as a key component of the AJP amid continued bipartisan scrutiny of large tech companies.

The Biden Administration has sought to increase the role of science and technology in decision-making across the federal government — from its approach to climate change and infrastructure, to health care and education and beyond. In his first weeks in office, Biden re-established the President’s Council of Advisors on Science and Technology and elevated the director of the Office of Science and Technology Policy to a Cabinet-level position for the first time. The administration also has prioritized research and development funding that would help position the US to lead the world in the development and manufacture of new technologies. 

At the same time, large technology companies continue to be subject to bipartisan scrutiny. After the January 6 attack on the Capitol, this scrutiny has broadened for some congressional Democrats who have criticized the role of social media used in organizing and promoting the actions of demonstrators. Some congressional Republicans have objected to some social media companies banning former President Trump and conservative viewpoints from their platforms. There has been continued debate on both sides of the aisle regarding whether “big tech” companies have gotten too big, as well as the extent to which they should be shielded from liability under Section 230 of the Communications Decency Act. The president’s nominations to key posts, including the Federal Trade Commission and the National Economic Council, appear to demonstrate that Biden shares concerns about the size of technology companies. 

Key executive actions
  • President’s fiscal year 2022 budget requests $500 million for the Technology Modernization Fund, an additional $110 million ($2.1 billion in total) for the Cybersecurity and Infrastructure Security Agency, and $750 million as a reserve for federal agency information technology enhancements
  • Commerce Department negotiators continue to work toward an agreement on cross-border data transfers in light of the Schrems II decision in which the Court of Justice of the European Union invalidated the EU-US privacy shield
  • US sanctions on Russia over SolarWinds hack

 

Key congressional actions during Biden’s first 100 days
  • ARPA included $650 million for Computational Intelligence for Security and Defense Applications, $1 billion for the General Services Administration’s Technology Modernization Fund and $200 million for the U.S. Digital Service
  • House and Senate Committees held hearings about the SolarWinds hack, potentially laying the groundwork for legislation on future incidents, as well as supply chain security
  • HR 1251, Cyber Diplomacy Act, was passed by the House Foreign Affairs Committee with bipartisan support; legislation would establish an Office of International Cyberspace Policy at the State Department and promote US leadership in cybersecurity
  • House and Senate Antitrust Subcommittees each held hearings on competition policy, including a focus on big tech

 

Select key personnel confirmed

Pending Senate confirmation:

  • Eric Lander, Office of Science and Technology Policy Director
  • Chris Inglis, National Cyber Director
  • Jen Easterly,  Cybersecurity and Infrastructure Security Agency 
  • Director Linda Khan, Federal Trade Commissioner

Other key personnel (confirmation not required):

  • Anne Neuberger, Deputy National Security Advisor for Cyber and Emerging Technology

 

What to watch

As Congress and the administration debate infrastructure proposals, Biden will continue to stress that infrastructure is more than roads and bridges — infrastructure includes broadband, semiconductors, electric vehicles, clean energy and other technologies that will allow the US to compete globally, address climate change and create opportunity. As proposed by the administration, the AJP would deploy high-speed broadband to all Americans, modernize the electrical grid, increase the energy efficiency of federal buildings, fund research and development and job training, invest in semiconductor manufacturing, create a national network of electric vehicle charging stations and invest in numerous other technologies as part of the effort to rebuild America. The over $2 trillion cost of the AJP and proposals to cover some of those costs with tax increases remain controversial, and the legislation will likely go through many iterations before it is considered by Congress.

Action on long-standing priorities, like national privacy and data breach legislation, and advancement to rein in big tech could continue to stall. Congressional negotiations remain stuck on two major issues — the extent to which federal legislation would preempt state law, and whether individuals would be able to bring private rights of action under the statute. However, if the Biden Administration chooses to make these issues a priority or states pass conflicting laws, an increased press for a federal solution may result.

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Key issue #8

Financial services

Expect efforts to combat climate change, address systemic issues, consider cryptocurrencies and other investor priorities to top the agenda.

With the administration’s heightened focus on the COVID-19 pandemic, the economy, climate change and racial equity, financial services generally has not been an early priority on the Biden agenda, except where there is an intersection in one of these four policy areas or broader Democratic Party priorities. Moreover, several of the financial regulatory agencies still have acting or newly appointed leaders, meaning that their agendas have not yet been set. Issues receiving regulatory attention have included climate-related risks to the financial system; disclosure of ESG matters; consumer protection; and racial equity, financial inclusion and access.

Activity has been particularly high with respect to combating climate change. The Treasury Department, Federal Reserve Board (FRB) and Office of the Comptroller of the Currency (OCC) are examining how climate change may pose risks to and opportunities for the financial system. The Securities and Exchange Commission (SEC) also is reviewing how capital market participants are currently addressing climate and other ESG issues, and it has issued a request for comment on whether and how the SEC should require disclosures in these areas from public companies. At its first meeting of 2021, the Financial Stability Oversight Council (FSOC), which is led by Treasury and comprises the leaders of the financial regulatory agencies, one of the key priorities announced was addressing the impact of climate risk on financial stability. Republicans in Congress have challenged some of these efforts, questioning whether climate-related considerations fall within the regulators’ authority.

Several agencies also have begun to roll back certain policies and measures viewed as deregulatory that were taken under the Trump Administration. This includes the Department of Labor, which announced it would not enforce rules that made it more difficult for fiduciaries to consider ESG factors when investing and voting proxies on behalf of the pension funds they manage.

Outside of Biden’s priorities, regulators have had to respond to recent market developments that raise investor protection and market structure concerns, such as the boom in special purpose acquisition companies (SPACs) and the volatile trading of certain high-profile stocks  driven by social media. The recent collapse of a family-owned fund that brought about large losses at major banks also is prompting reviews by the SEC, FRB and Commodity Futures Trading Commission (CFTC) about potential weaknesses in the financial system. This includes an FRB examination of risk management failures at its supervised banks.    

Another area of activity for the federal banking agencies is the consideration of using technology in the financial sector. Agencies including the FRB, OCC and Consumer Financial Protection Bureau issued a request for input on how the use of artificial intelligence (AI) by financial institutions may pose risks to the businesses and consumers they serve and the challenges in developing, adopting or managing AI.

In Congress, both committees with jurisdiction over financial services also are focusing on the Biden priorities: Senate Banking, Housing and Urban Affairs Chairman Sherrod Brown (D-Ohio) has focused his committee’s agenda heavily on housing-related issues and equity, including COVID-19-related relief, strengthening federal housing authorities, assistance for underserved and minority communities, and climate change and its related impacts on areas within the committee’s jurisdiction. House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) has maintained her committee’s focus on responding to the COVID-19 pandemic and its impact, as well as ensuring that the financial system is fair and that consumers and investors are protected.

Key executive actions

 

Key congressional actions during Biden’s first 100 days
  • Senate Banking, Housing and Urban Affairs Committee held 22 hearings related to COVID-19 pandemic, housing, equity, market volatility and climate change risk to the financial system.
  • House Financial Services Committee held 24 hearings on many of the same issues, with a particular focus on equity and access
  • Democrats filed Congressional Review Act resolutions on the “true lender” rule finalized by the OCC (S.J. Res. 15) and an SEC rule that affects how shareholders can present proposals at corporate meetings (S.J. Res. 16)

 

Select key personnel confirmed
  • Janet Yellen, Treasury Secretary
  • Cecilia Rouse, Chair, Council of Economic Advisers Chair
  • Isabella Casillas Guzman , Small Business Administration Administrator
  • Gary Gensler, Securities and Exchange Commission Chair
  • Rohit Chopra, Director of Consumer Financial Protection Bureau

No nominee announced:

  • Comptroller of the Currency
  • Office of Management and Budget director
  • Federal Housing Finance Agency director

 

What to watch

Of the various legislative proposals in the financial services space, those most likely to see movement are related to COVID-19 and economic relief and proposals with racial equity ties. For example, despite gaining steam last Congress but falling short of enactment, the Improving Corporate Governance Through Diversity Act of 2021 (H.R. 1277 and S. 374) is likely to pass the House at some point this Congress, but will face obstacles in a 50-50 Senate. Democrats in Congress will also seek to exert oversight over large banks, including by holding hearings in both committees of jurisdiction at the end of May, at which the CEOs of the country’s six largest banks will testify.

On the regulatory side, expect more cross-agency activity to address certain systemic issues in the coming months. The FSOC plans to examine the role of money market mutual funds and hedge funds in times of market stress, looking across the financial regulatory landscape. Climate-related risks and disclosures also will continue to garner the attention of the financial policy making and business communities. While companies and financial institutions increasingly are prioritizing their efforts to address climate change and report on those efforts, conflicts are expected to emerge regarding the best way to go about this, particularly as the market-driven, voluntary approach taken during the Trump Administration gives way to a greater emphasis on mandatory requirements under Biden.

Cryptocurrencies are another area of potential policy activity. Newly confirmed SEC Chair Gary Gensler has expertise in this area and is expected to place cryptocurrencies’ role in the capital markets on the SEC’s agenda. Gensler, along with the new heads of the OCC and the CFTC, once appointed, will have to determine how open to be to these assets in light of the potential risks they pose. Yellen has also highlighted the risks associated with cryptocurrencies, such as cryptocurrencies being used to support organized crime. Recent swings in the value of certain high-profile stocks are likely to lead to an additional examination of the volatility in the stock market, the role of social media platforms in such volatility and equity in access to our nation’s financial system.

Investor- and consumer-driven initiatives, such as those related to the rules governing corporate boards’ consideration of shareholder proposals and other matters, are another area ripe for potential policy activity. For example, the SEC recently voted to reopen the comment period for the proposed rules for the use of universal proxy cards in all nonexempt solicitations for contested director elections, which has been a high priority for the investor community for several years.

Beyond 100 Days

Five key considerations for businesses

After 100 days, it’s apparent that the Biden Administration has an ambitious agenda with significant implications for US businesses. Here’s a look at some of the key elements that business leaders should consider in light of the evolving public policy landscape.

1. Elevating people

Companies should consider taking the next step to implement programs that can narrow the digital divide among employees and communities, support a healthy return to office work while imagining new methods of working and collaboration, and put their employees at the center of their long-term future-of-work plans.

2. Financial inclusion

Inclusion and equity have emerged as critical issues facing companies today. The access, availability and affordability of financial products are especially sensitive areas. Companies should consider how they can leverage new and existing organizational accelerators to drive change around strategy, products and disclosure; inclusive analytics and fair use of data; consumer access and protection; digital access; and inclusive recovery.

3. Supply chain

The Biden Administration has issued a string of executive orders designed to increase government’s role in resiliency — especially in strategic markets such as medicine, personal protective equipment, semiconductors, and other items of national security and health. Companies in target sectors should prepare for policy shifts ranging from government tax incentives to restrictions such as export controls. Businesses should conduct scenario analyses around diversifying, insourcing or retaining domestic supply chain capabilities. They should also evaluate the strategic architecture of supply chains and align the design, production, warehousing and distribution of products with the environment and life cycle management in mind.

4. Sustainability

The proposed AJP has significant implications for sustainability and the green economy, including $174 billion for electric vehicle adoption and support, funds to plug oil and gas wells, and incentives to jump-start clean energy manufacturing. Companies in related industries should be following these opportunities closely and consider them in light of merger and acquisition decisions and risk assessments.

5. Tax

Companies should be evaluating the potential tax impact of the administration’s Made in America Tax Plan, as well as the TCJA regulations and sunsetting provisions. Understanding potential trade disruptions and new domestication incentive policies — in the US and elsewhere — could help companies align their supply chain and global capital investment policies and develop business-aligned tax action plans that are responsive to potential tax and trade changes.

  • Show article references

    In 2009, Congress passed the American Recovery and Reinvestment Act, which included over $105 billion for infrastructure investments. It was the largest infrastructure program since the Eisenhower interstate system; the most notable example is the 1933 New Deal, which is seen as one of the largest infrastructure investment plans in US history.

Summary

Biden’s first 100 days offer insights for companies, investors and other stakeholders to consider about eight key public policy issues, and also offer signals of what to expect as the administration and Congress continue to drive their agendas.

About this article

Authors
Bridget Neill

EY Americas Vice Chair, Public Policy

Regulatory and policy strategist. Three decades in shaping public policy impacting global financial markets and accounting profession. Passionate about family. Outdoor sports enthusiast.

John D. Hallmark

Ernst & Young LLP Principal, Public Policy, and US Political and Legislative Leader

Public policy professional with a deep understanding of the Washington legislative and political arenas. Works with key stakeholders to formulate and execute on the firm’s policy initiatives.