Yesterday Joe Biden released his budget proposals for the next fiscal year. In the ritualistic role-playing that is the annual budget process in the US, a president’s proposals are taken seriously as likely to be implemented only if the president’s party controls both houses of Congress. Otherwise, the opposition party that is the majority will dismiss the proposals outright. Those are the usual opening moves in this dance and it is being followed this time with Republican speaker Kevin McCarthy and others in his party’s leadership dismissing the budget.
In a joint statement, House speaker Kevin McCarthy and other top Republicans accused Biden of “shrugging and ignoring” the national debt, which they called one of the “greatest threats to America”.
”President Biden’s budget is a reckless proposal doubling down on the same far-left spending policies that have led to record inflation and our current debt crisis,” the statement said.
McCarthy’s statement looked like it might have been written well in advance since he accuses the Biden budget of ignoring the national debt when in fact Biden argues that his budget will lower it by $2.9 trillion over the next ten years. The precise numbers are always subject to debate but it is incorrect that Biden is ‘ignoring’ it when it is the top line item.
That does not mean that this is a wasted exercise. The president’s proposals should be viewed as more like a campaign platform, especially so since next year will be a presidential election year. Progressives have reserved their criticisms mostly to the absurdly high military allocation while generally praising the budget,
Biden advocates for $59 billion in funding and tax incentives to increase the affordable housing supply; $10 billion to remove barriers to affordable housing developments; and $10 billion to address racial and ethnic homeownership and wealth gaps. The president proposes providing $4.1 billion for the Low Income Home Energy Assistance Program—and allowing states to use some of that money to provide water bill assistance to poor households, since a related program expires at the end of 2023.
Along with fighting for billions of dollars to ease hunger, the administration aims to pour money into high-poverty school districts as well as improve the affordability of higher education by increasing the discretionary maximum Pell Grant by $500, expanding free community college, and subsidizing tuition for students from families earning less than $125,000 enrolled historically Black, tribally controlled, or minority-serving institutions.
“Time and again, President Joe Biden delivers on his promise to fight for American families, his commitment to fairness for all Americans, and his belief that everyone should have the freedom and opportunity to build a better life. This budget reflects those priorities and values by helping people continue to rebuild,” said American Federation of Teachers President Randi Weingarten, who highlighted various proposed investments in education and major federal programs.
The budget lays out what Biden’s priorities are, to contrast with what Republicans may eventually propose. Eventually, there will have to be some compromise to get some budget spending bills passed so that the government can function. I suspect that given how beholden McCarthy is to his extremist members, the compromise may be a continuing resolution, where the current year’s spending is continued to the next year.
This article provides more detail on what Biden is proposing. There is a lot to like in it.
As political gridlock puts the government at risk of defaulting, President Joe Biden on Thursday made an opening bid with a budget plan that would cut deficits by $2.9 trillion over the next decade – a proposal that Republicans already intend to reject.
In addition to deficit reduction, Biden’s 10-year budget largely revolves around the idea of taxing the wealthy to help fund programs for the middle class, older adults and families. It would raise $4.7 trillion from higher taxes, with an additional $800 billion in savings from changes to programs.
The tax increases include a reversal of the 2017 tax cuts made by President Donald Trump on people earning more than $400,000 a year.
Biden has floated a new 25% minimum tax on households worth $100 million or more. Also, the tax that companies pay on stock buybacks would rise fourfold and those earning more than $400,000 would pay an additional Medicare tax that would help to keep the program solvent beyond the year 2050. Medicare could negotiate on the prices of more prescription drugs, helping to save the government money.
Accompanying that would be $2.6 trillion worth of new spending, including the restoration of the expanded child tax credit that would give families as much as $3,600 per child, compared with the current level of $2,000. That credit would be “fully refundable,” which means households could receive all of that sum even if they don’t owe any taxes. The budget proposal would impose a $35-a-month cap on insulin prices, matching a change that Biden already put in place for Medicare recipients.
The budget would seek to close the “carried interest” loophole that allows wealthy hedge fund managers and others to pay their taxes at a lower rate, and prevent billionaires from being able to set aside large amounts of their holdings in tax-favored retirement accounts. The plan also projects saving $24 billion over 10 years by removing a tax subsidy for cryptocurrency transactions.
Biden’s proposal would increase the top marginal tax rate to 39.6% on income above $400,000. For households with $1 million in income, earnings from capital gains, such as stocks or property sales, would no longer enjoy a discounted tax rate compared with wages. The president would increase the corporate tax rate to 28% and increase the tax rate on U.S. multinationals’ foreign earnings from 10.5% to 21%.
So now the ball is in the Republicans court to come up with an alternative budget. They have been stalling for the longest time because they realize that they are in a bind.
[Speaker Kevin] McCarthy has called for putting the U.S. government on a path toward a balanced budget. But by refusing to raise taxes or cut Social Security and Medicare spending, GOP lawmakers face some harsh math that makes it hard to reduce deficits without risking a voter backlash before a presidential election.
As usual when Republicans do not control the presidency, they are making a big song-and-dance about the need to reduce the debt and threatening to not raise the debt ceiling, something they never do when a Republican is president. They can claim that Biden’s budget does not cut the deficit enough and that he should go further but in the absence of any concrete alternative proposals of their own, that would be a hollow charge. They undoubtedly hate the proposed increased taxes on the wealthy and corporations but eliminating those only makes their job of coming up with a budget harder.
After successfully needling them during his state of the union speech to get them to loudly oppose cuts to Social Security and Medicare, Biden is taunting them to come up with something, once again reminding voters of past Republican attempts to cut Social Security and Medicare, and promising to block any attempts to do so again.
At the heart of his budget is a plan that the White House says would help avert a Medicare funding crisis and extend the program’s solvency for at least 25 years. The plan would raise Medicare taxes from 3.8% to 5% for those who earn more than $400,000 per year to protect the government health insurance program for adults over 65, which is at the heart of a brewing policy debate poised to play a central role in the 2024 presidential election.
“I guarantee you I will protect social security and Medicare without any change – guaranteed,” Biden said, drawing some of the loudest applause of his nearly hour-long speech. “I won’t allow it to be gutted or eliminated as Maga Republicans have threatened to do.”
Republicans have accused Biden of distorting their position on the issue and insisted they have no plans to cut either program. But they have yet to put forward a counter-proposal, despite promises to put the US on a path to a balanced budget.
By rejecting tax increases and denying charges that they would cut social security or Medicare programs, it is unclear how Republicans would achieve that goal.
“How they gonna make the math work? What are they gonna cut?” Biden said.
It seems like Biden is relishing the prospect of having this fight with Republicans.
McCarthy will stall as long as he can but with the debt ceiling reaching a crisis around June, he will have to come up with something before then that will please the extremists in his caucus as well their Dear Leader Donald Trump.
You know, with an actively hostile Russia and a belligerent China, I’ve changed my mind from a few years ago. I don’t mind that military spending. Oh, I mind the spending that goes to waste, but not spending on productive and useful military programs.
Right. You are basically ignoring how far US military spending outclasses *every other fucking country on the planet* and indeed even other blocks. I’m sure also that you’re not unaware of that so you’re basically a lying sack of shit. Any political pressure to increase US military spending to “keep up” is a lie, and a waste, and not productive, and not useful.
Well, currently that spending might not be enough to defend Taiwan from China, so maybe we’re not spending enough.
In a world without (other) imperialist nations like China and Russia who are actively planning or actively carrying out colonialist military invasion, I would be all for reducing US military spending. However, while those threats exist, and while it seems like they might be a threat to the US military, I’m going to support spending for the US military, under the reasoning that US imperialism is a lesser evil than Russian or Chinese imperialism.
Except that existing spending is *already very capable of dealing with any of those threats*. That was the whole point of it.
Now I’m not suggesting that cutting that off will deal with US imperialism, which I think is a bad thing, but admittedly less bad than some other nation’s imperialism, but possibly worse than some other nation’s imperialism. Spending is not actually the issue there -- political control is.
But spending *doesn’t need to go up*. US doctrine has always been to be bigger and stronger and be able to deal with that shit. And it’s already enough.
The drive to increase spending isn’t about military targets even a little bit, it’s about driving the herd to support the party. A pointless waste.
It’s not as far as I know. Again, I think there’s some doubt about whether the US could defend Taiwan from a Chinese invasion.
I used to think that. Then Russia invaded Ukraine, and it’s US military spending that allowed Ukraine to defend themselves from the Russian genocide. And China is looking to do something similar to Taiwan.
Yea. Australia already has nuclear reactors. They just don’t have any nuclear reactors for electricity generation.
Whoops, wrong thread.
@5, Oh that’s funny. The US military budget (not including military-related expenditures) is greater than the combined budgets of the next 10 countries, the vast majority of which are US allies*. The question is never “could we do it?” it’s “should we do it, considering the repercussions and consequences?”
But sure, argue for more $ for the military while parts of the country are devolving to near third-world status. When Doctors Without Borders shows up in rural areas of your country because people there need healthcare, maybe your priorities aren’t quite what they should be. Maybe if they need chest x-rays we can have them stand next to a stockpile of tactical nukes (you know, the “small” ones that only have a yield 10 times that of Little Boy).
* That varies a bit from year to year, but that’s a typical number.
I’m extremely sympathetic to what you say. I think we can do both.
Australia has one nuclear reactor, the Open-pool Australian lightwater reactor (OPAL), at the Australian Nuclear Science and Technology Organisation (ASTO) facility at Lucas Heights. There may have been a short period in 2006/07 when both the High Flux Australian Reactor (HIFAR) and OPAL reactors were both running at Lucas Heights before the former was decommissioned.
Both reactors were used for research, for the production of medical and industrial radioisotopes and for some other products and processes.
Both were relatively low power, 10 and 20MWt respectively.
We seem to be wholly unable to do one because we are in thrall to the other. The DoD is the only department that routinely gets more for their budget than they ask for and which has year-over-year increases larger than the budgets of many entire departments.
Please to pull the other leg now.
consciousness razor says
Considering our circumstances, I don’t know what makes you so afraid, beyond worrying about what terrible shit we are going to do next. The US is incredibly safe and is the most powerful country in the world. Enough said.
Fear-based arguments are kind of weird. Do you think victims of US imperialism are any less afraid of the US than you are? I get what they’re afraid of, but what is your fear even supposed to be about? That’s not so clear. If it’s just Asians or whatever, then we have a problem.
Besides, you’re saying why you “support spending” on the military, as if there were any chance at all (or as if there were a serious proposal) that they literally get $0 per year in funding. In the real world, it’s nowhere near zero, and you know that perfectly well. If you won’t even attempt to explain why they ought to constantly get the enormous sums which we actually see and which are actually at issue, since you’re only going to say why you think the amount should not be zero, that’s some pretty weak tea. I don’t know who you’re trying to convince of what with that horseshit.
Empathy. I’m not claiming that the US is at risk in the foreseeable future, but Ukraine sure is, as well as several other countries in eastern Europe and also other countries that border Russia such as Georgia. I disagree with your selfish and short-sighted isolationist position.