BIDEN’S $6T BUDGET PROPOSAL STRONG ON SOCIAL SPENDING
President Joe Biden is proposing a $6 trillion budget for next year that’s piled high with new safety net programs for the poor and middle class, but his generosity depends on taxing corporations and the wealthy to keep the nation’s spiking debt from spiraling totally out of control, Andrew Taylor reported for the Associated Press (AP).
Biden inherited record pandemic-stoked spending and won a major victory on COVID-19 relief earlier this year. Friday’s rollout adds his recently announced infrastructure and social spending initiatives and fleshes out his earlier plans to sharply increase spending for annual Cabinet budgets.
This year’s projected deficit would set a new record of $3.7 trillion that would drop to $1.8 trillion next year — still almost double pre-pandemic levels. The national debt will soon breach $30 trillion after more than $5 trillion in already approved COVID-19 relief.
As a result, the government must borrow roughly 50 cents of every dollar it spends this year and next. Under Biden’s plan, the debt held by the public would quickly match the size of the economy and soon eclipse record levels of debt relative to the gross domestic product that has stood since World War II.
That’s despite more than $3 trillion in proposed tax increases over the decade, including an increase in the corporate tax rate from 21% to 28%, increased capital gains rates on top earners, and returning the top personal income tax bracket to 39.6%.
With the deficit largely unchecked, Biden would use proposed tax hikes on businesses and high-earning people to power huge new social programs like universal prekindergarten, large subsidies for child care and guaranteed paid leave.
“The best way to grow our economy is not from the top-down, but from the bottom up and the middle out,” Biden said in his budget message.
“Our prosperity comes from the people who get up every day, work hard, raise their family, pay their taxes, serve their Nation, and volunteer in their communities.”
The budget incorporates the administration’s eight-year, $2.3 trillion infrastructure proposal and its $1.8 trillion American Families Plan and adds details on his $1.5 trillion request for annual operating expenditures for the Pentagon and domestic agencies.