4 Takeaways On Biden’s Massive Spending Plans

President Joe Biden’s $1.6 trillion effort to green the economy, rebuild infrastructure and return manufacturing to the U.S. is facing a potentially devastating threat in the 2024 election.

POLITICO’s monthslong examination of Biden's four biggest legislative achievements found that they have spurred action across the government, including a stream of announcements by federal agencies and private companies about plans to deploy billions of dollars.

But the actual federal spending to date is considerably smaller than the amounts Biden and his agency heads have announced. Much of the country has yet to feel the full impact of this money, in part because of the time it takes to move so much spending through the machinery of government.

Looming over the initiatives is the possibility that November’s election could bring a second term for former President Donald Trump, who could try to undo much of Biden’s legacy.

Here are four central takeaways of POLITICO’s reporting about implementation of four key laws — the infrastructure, energy and climate portions of the 2021 pandemic relief package; the 2021 infrastructure law; the 2022 CHIPS and Science Act; and Biden’s climate law, the Inflation Reduction Act.

1. Less than 17 percent of the money Congress approved has been spent so far.

What we found: Out of more than $1.6 trillion these laws provided for climate, infrastructure and energy, roughly $1.1 trillion was to be direct spending — largely in the form of grants, loans and contracts.

But it’s taken a while to get the dollars moving.

For the infrastructure, pandemic and CHIPS laws, agencies have formally awarded $242 billion to date, meaning the federal government has committed to pay out this sum. For the IRA, the government has announced roughly $60 billion in potential funding.

The amount that agencies have actually spent is even smaller, between $125 billion and $186 billion, according to POLITICO’s review of federal data. That number is a broad range because no public resource offers a full accounting of formal awards or spending under the IRA. As a result, we’ve included the full scope of funding announced under the IRA in our estimate in order to reflect the maximum amount of spending that could have taken place.

Why this matters: The administration isn’t legally required to spend this money in Biden’s first term — and some of the infrastructure cash can’t legally be spent until next year or later. Biden White House officials predict a continued surge of formal commitments through at least January.

But the fact that only a relatively small percentage of the overall investment has been spent means the real-world effects may not yet have touched some parts of the country, including key voters in the election.

2. Look beyond Biden's big announcements

What we found: The administration prefers to focus on a very big number — the amount of money agencies have announced they will provide to recipients under one or more of the laws.

These multibillion-dollar announcements have become a routine staple of the Biden era, often featuring a public appearance by the president or a member of his Cabinet. As of April, the announcements have totaled more than $543 billion, or half of the full value of what Congress appropriated.

Private companies, including those hoping for a share of the new grants, loans or tax breaks, have followed through with their own announcements. Those have totaled more than $866 billion in planned investments for industries such as advanced chips, electric vehicles and clean energy manufacturing.

But an announcement doesn’t necessarily mean the money will flow quickly — or that the announced recipient will ever see it. Agencies typically announce tentative awards after identifying a recipient and a funding amount, but the awards could still be under negotiation, and either side might back out.

Similarly, changing market conditions or worries about federal policy have prompted some companies to cancel or delay major electric vehicle, battery, solar and wind projects.

Why this matters: Funding announcements can show that agencies are pushing to make progress on Biden’s agenda. Many published analyses of the administration’s policies have focused at least partly on the announcements. But the big-dollar proclamations may give an inflated picture of the impact that Biden’s policies are having so far.

3. Spending over $1 trillion is a lot of work

What we found: There are several explanations for the gap between announced and actual spending.

For one, negotiations for this money can take time, with the federal government sometimes awarding money weeks or months after it makes the announcement. State governments and other recipients also have significant leeway to decide where the money goes — or even how quickly Washington can put it out. For instance, states that want federal funding for electric vehicle chargers must first compile plans for using the money. For large-scale infrastructure projects, recipients typically have to do the work before Washington reimburses them. That lengthy process can take years.

And not all announcements necessarily lead to the intended recipient getting the cash. For instance, the Energy Department announced it had selected a Texas-based company for a $200 million grant to support a battery project in Tennessee, only to withdraw the award last spring. DOE didn’t offer a specific explanation, but the company had drawn criticism from Republican lawmakers because of ties to China.

Another company told POLITICO that a behind-schedule environmental review is holding up the money that the federal government awarded it.

Why this matters: The administration stresses — and our data shows — that it has made progress moving the money forward. But federal money comes with a lot of strings that frustrate some would-be recipients.

4. Would these efforts survive Trump?

What we found: Trump has lambasted Biden’s green energy programs and called for “impounding” congressionally approved spending he considers wasteful. He has been especially critical of the climate law and attacked Republican lawmakers who voted for the infrastructure law.

That increases the urgency for the Biden administration to implement the money effectively and quickly.

Why this matters: A Trump victory would create massive uncertainty for whatever federal dollars remain un-obligated. He could halt or slow the remaining grant approvals and applications, and a Trump Treasury Department could revise stalled rules for clean energy tax credits to restrict access. And he could shift the speed and focus for the Energy Department’s approximately $200 billion in remaining energy loan authority — a program he proposed abolishing when he was president.

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