Biden’s Unserious Budget

President Biden’s sprawling $6.4 trillion budget released on Thursday is best viewed as a political messaging exercise. With Republicans in control of the House of Representatives, the proposal was dead even before arrival. But the annual ritual of the president delivering a budget request to Congress was a useful opportunity for Biden to stake out ground in the bitter standoff over next year’s spending levels and the raising of the debt ceiling.

Biden’s purpose is to advance the notion that our fiscal problems could be solved by a willingness to let the very wealthy pay just a little bit more — and to accuse Republicans of holding the country hostage to protect tax cuts for the rich. Unless Republicans can overcome their internal divisions and offer a serious alternative, such a strategy just might work politically.

However, were we to judge Biden’s proposal as an actual effort in addressing U.S. fiscal problems, it would be an abject failure. The top-line numbers are that Biden’s proposal would raise taxes by $5.5 trillion and boost spending by $2.2 trillion over the next decade, as compared with the Congressional Budget Office baseline. While Biden claims $3 trillion in deficit reduction, this is measured against a baseline that was already inflated by the first two years of extravagant Biden spending. In February 2021, just after Biden was sworn in, CBO projected deficits of $14.5 trillion from 2021 to 2031. If adopted, the Biden policies would produce deficits of $18.9 trillion over the same period.

In 2019, the year before the pandemic hit, annual spending was $4.4 trillion. Biden is trying to make yearly budgets of above $6 trillion the new normal, and then build on them. The White House projects that the budget for the year 2033 alone will blow past $10 trillion.