JOE BIDEN’S administration has launched itself with striking purpose and drive, pushing through an initial $1.9 trillion stimulus package heavily targeted towards the poorest workers in the US. He is now following up with a planned $2 trillion “American Jobs Plan.”

$621bn is earmarked to overhaul America’s creaking road and rail infrastructure, $300bn is planned for manufacturing, $221bn for affordable housing, $100bn for superfast broadband across the whole country and billions for research and development.

In terms of scale, nothing like this has been attempted by a US government since President Franklin Roosevelt’s “New Deal” of the 1930s.

Crucially, Biden’s plan builds in what his team are calling “human infrastructure,” with $400bn for health and elder care. We all accept that big physical constructions are needed to keep modern life going, from roads to electricity generation to, today, broadband internet. But it is also obvious that keeping society going also requires a great deal of investment in things that aren’t built at all — most obviously in care work, but also in education.

Much of this work has been (both historically and today) performed by women, which helps explain why it has also been persistently undervalued by a sexist economics profession in particular. Yet this “human infrastructure” is, if anything, even more fundamental to how we live our lives, as the Women’s Budget Group in Britain, among others, have argued.

Biden’s plan is to spend hugely in overhauling care work, improving pay and conditions for care and health workers as well as providing the necessary investment in new buildings and equipment where needed. This would represent a sea-change in attitudes to not only how government spends its money, but what it treats as a priority.

Labour under Jeremy Corbyn promised more money for care work, education and the NHS, but despite calls to treat this as a priority “human” or “social” infrastructure investment, its spending plans did not match the transformative scale of the Biden ambitions.

But it’s not just how much is being spent and on what. Also in the package is the Protecting the Right to Organise Act, a major extension of union rights across the US, removing so-called “right to work” legislation at state level and imposing tough new penalties on employers who try to block union drives.

Its passage through the finely balanced Senate, where the Democrats have a majority of just one, is not guaranteed, but the administration has set a clear marker for the immediate future.

This is the government of the largest economy on the planet calling time on neoliberalism and marking a fundamental shift in how it expects governments to manage the economy.

Since the 2008 financial crisis, governments across the world have been more forthright in their economic interventions, with “industrial policy” to support key industries and sectors coming back into fashion, urged on by economists like Marianna Mazzucato and the clear examples of countries like China and South Korea.

This tendency has accelerated with the Covid-19 pandemic. But the role of US progressives and socialists in shifting the debate in the US has been fundamental, with Senator Bernie Sanders pulling the Democrats to the left and helping steer the initial $1.9tn stimulus Bill through the Senate.

The contrast with the Labour Party today is stark. Shadow chancellor Anneliese Dodds and shadow business secretary Ed Miliband have called for more investment in green jobs and infrastructure, including £30bn for 400,000 green jobs and public investment and ownership in battery-producing “Gigafactories.” Dodds has indicated her support for greater care work spending.

But Keir Starmer’s leadership has been marked by its severe reticence in making big calls on the economy and too often chases the fading neoliberal status quo — wrongly opposing the Conservatives’ popular corporation tax increases, even as Biden wants to push the US corporate tax rate up to 28 per cent.

The Biden administration has lifted the bar for government action and progressive and social democratic parties across the world should raise their sights accordingly. Think tank IPPR has said £190bn would match the scale of the Biden plan for Britain and is easily affordable, whilst the Green New Deal campaign has called for £69bn to create 1.2m green jobs in the next two years.

This is how Labour should be fighting for the economy, with bold ambitions and clear plans — not vague talk of “values,” or, worse, letting giant corporations off the hook for tax rises.

Biden could, of course, go further. The planned spending includes $174bn on electric vehicle infrastructure and $100bn for green electricity, helping make it the largest green expenditure programme in US history.

But for the US to meet its Paris Climate Accord agreements — now signed back into US law in one of Biden’s first acts as president — it will need to move still faster on decarbonisation.

Alexander Ocasio-Cortez has called for a $10tn boost to create 15 million green, unionised jobs over the next decade. Nor is the complete package guaranteed to get through the reactionary bloc of the Senate.

And it should be clear that an expansive and progressive domestic policy can sit very comfortably with continued US aggression abroad. Biden has already made his intentions towards China clear, with US Secretary of State Anthony Blinken ratcheting up the rhetoric at the recent US-China summit.

The Trump-era sanctions and trade tariffs remain in place, with Biden’s Interim National Security Strategy identifying an “assertive” China as its primary threat. And if implemented, the stimulus packages are likely to exacerbate these tensions — pushing up US imports from an expanding Chinese economy and widening the trade deficit.

The US’s greatest fear is that China will not just be able to match the US, but actually set a lead for the world in the critical new and emerging technologies around 5G and AI.

This is what China’s Made in China 2025 plan amounts to and it is this threat of the US losing its technological lead — rather than the trade deficit as such — that is the real driver of the conflict.

Nor will the intervention prevent the world’s largest capitalist economy running into its own problems down the line. Olivier Blanchard, the former chief economist of the IMF is amongst those now warning that Covid-19 is likely to produce significant, long-term costs which could make US businesses increasingly uncompetitive in the world.

After the initial boost from reopening and the stimulus over this year and next, the US central bank, the Federal Reserve, is predicting only low growth in the near future. Faced with rising costs and creaking growth, the pressure will be on US businesses to cut their expenses. Inevitably, this will mean trying to squeeze workers’ pay and conditions.

Part of the Biden plan is to rebuild support for US capitalism as a whole by shifting the balance of power and income a little back towards workers. But this could be in tension with the demands of specific US businesses seeking to cut costs.

So whilst we can and should insist that other governments must follow the Biden lead, in scale of ambition and pro-labour legislation, this does not mean handing him or his administration a free pass.

Aggression against China or other states by the US must be opposed, especially where its close allies, like Britain, might be dragged along. And attacks on US workers must be resisted and met with international solidarity — just as has been shown in support of Amazon workers, fighting for union recognition.

James Meadway is a former adviser to John McDonnell and former chief economist for the New Economics Foundation — follow him on Twitter @meadwaj.