Sad! Not good!
"Don't tell me what you value. Show me your budget, and I'll tell you what you value," President Joe Biden loves to say. He said it again when he introduced his fiscal 2023 budget this week. And as bad as the increased $1.4 trillion in spending and $2.5 trillion in higher taxes over the next decade are, what is most noteworthy is what isn't in the document: Biden's signature legislative agenda, Build Back Better.
You know Biden is somewhere right now drowning his sorrows with Linkin Park blasting in the background.
Sure, there is a footnote explaining that the budget includes "a reserve for legislation that reduces costs, expands productive capacity, and reforms the tax system." No doubt this is meant to be a placeholder for Biden's Build Back Better agenda, which the budget claims is still being discussed with Congress.
It's really a tragic story. Biden pushed so hard to build America back better – so hard, in fact, that he wrecked the economy, ignored our border, and nearly started WWIII with Russia in the process.
You have to feel a bit sorry for him. Hopefully another weekend at his beach house with some chocolate chocolate chip ice cream will make him feel better.
But Build Back Better isn't some nebulous proposal. It is actual legislation that has passed the House and been scored by the Congressional Budget Office. According to the CBO, a true 10-year scoring of Biden's signature legislative agenda would raise spending by $5 trillion and add $3 trillion to the deficit. Adding $3 trillion to already record-high deficits during record-high inflation is probably not the message Biden wanted to send with his budget proposal, which is assuredly why he kicked it to the curb.
Instead, Biden has included a "billionaire minimum income tax," which is neither limited to billionaires nor to income. In reality, it is a wealth tax that applies to anyone with $100 million or more in assets. In order to determine who must pay this tax, taxpayers would have to report not just all of their income every year to the IRS but also all of their assets. The reporting requirement alone would add billions of hours in tax compliance for tax filers.
Oh, Biden also wants to raise the corporate tax rate from 21% to 28%, which will increase prices even faster for the average family!!
Even the liberal Tax Policy Center admits this corporate tax hike would raise costs for most middle-class households by $300 a year. That would break Biden's pledge not to raise taxes on families making less than $400,000 a year.
At this point, has Biden done anything he pledged to do?
The problem isn't revenue. Even without Biden's tax hikes, taxes as a percentage of gross domestic product rose to 18.1% in 2021 and are expected to rise to 19% in 2022. This is well above the post-1972 average of 17.3%.
No, the deficits are being entirely driven by spending, which peaked at 31% at the height of the COVID spending before falling to a projected 23.9% at the end of the Biden budget 10-year window. This is way above the post-1972 20.8% average. If someone could just get spending down to the levels it was at as recently as 2001, when it was just over 17.5%, the nation's finances would be on a much more stable path.
If only we could get a politician in office who actually cares about the financial health of our nation before we drive off a cliff!
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