Lower deficit, higher taxes on the rich

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In his 2023 budget proposal released on Monday, President Joe Biden seeks to reduce the $1 trillion deficit over the next decade while investing in strengthening national security, fighting crime, tackling inflation, growing the economy, and preparing for infectious disease outbreaks beyond COVID-19.


What do you want to know

  • President Joe Biden seeks to reduce the $1 trillion deficit over the next decade while investing in strengthening national security, fighting crime, fighting inflation, growing the economy and preparing for infectious disease outbreaks beyond COVID-19
  • The budget also makes it clear that Biden is not ready to let go of many items on his social and climate wish list that have been stalled since his Build Back Better legislation failed to gain the support it needed. on Capitol Hill last year.
  • The programs would be funded, in part, by tax reforms targeting the wealthiest Americans and businesses
  • Budget proposes $6.9 billion for international efforts to counter Russia’s assault on Ukraine and support Kyiv, plus more than $800 billion for defense and national security

The budget also makes it clear that Biden is not ready to let go of many items on his social and climate wish list that have been stalled since his Build Back Better legislation failed to gain the support it needed. on Capitol Hill last year.

“I hope Congress will pass this law this year so I can sign it and we can get to work,” President Biden said in a speech Monday.

The budget includes a no-deficit reserve fund in anticipation of Congress passing legislation that would help reduce costs for families and increase productive capacity. Biden wants to cut costs for prescription drugs, health care premiums, child care, long-term care, housing and college.

The programs would be funded, in part, by tax reforms targeting the wealthiest Americans and businesses. People with more than $100 million would be required to pay at least 20% of their total income in federal taxes, while Biden would raise the corporate tax rate from 21% to 28% – still well below the 35 % he reached before the former president. Donald Trump and congressional Republicans lowered it in 2017.

The White House would not say on Monday whether there has been any recent progress in legislation talks for a social and climate bill.

“The deficit-neutral reserve fund is supposed to leave the space — revenue, in particular — for congressional negotiators to do what President Biden has asked,” said Shalanda Young, director of the Office of the management and budget, to reporters in a Monday morning call.

But the talks have stalled since December, with little progress since then. Young would not detail further discussions, saying she did not want to “rush negotiations in Congress.”

A president’s budget can be used as a template for Congress to draft legislation, but they don’t have to follow its recommendations to a T. Democrats hold the smallest of Senate majorities, which means many The president’s priorities could fall from the ultimate spending bill as it passes.

Biden’s budget focuses on three key values, Young told reporters during a Monday afternoon briefing: fiscal responsibility, national and global security and, ultimately, building a better America.

“The budget also makes clear that the president is committed to working with Congress to pass legislation that reduces the deficit, lowers costs for families, and increases the productive capacity of our economy,” she said. . “These are all things we can improve on together.”

President Biden also highlighted budget allocations for security, both at home and abroad, on Monday.

The budget proposes $6.9 billion for international efforts to counter Russia’s assault on Ukraine and support Kyiv, as well as more than $800 billion for defense and national security.

It also includes more than $33 billion for state and local law enforcement and an additional $1.7 billion for the Bureau of Alcohol, Tobacco, Firearms and Explosives to expand its strike forces against arms trafficking.

“It’s a problem that families face in every part of the country,” Biden said. “The answer is not to defund our police services. It’s to fund our police officers and give them all the tools they need: training, foundation, partners and protectors that our communities need.”

The request for $813.3 billion for defense and national security, including $773 billion in Pentagon spending, represents an increase of about 4% from 2022.

“This will be one of the biggest investments in our national security in history,” Biden said. “Some people don’t like the increase, but we’re in a different world today.”

Vermont Sen. Bernie Sanders, who chairs the Senate Budget Committee, said Monday of Biden’s military spending proposals: “At a time when we are already spending more on the military than the next 11 countries combined, no , we don’t need a massive increase. in the defense budget.

The budget proposal also calls for “nearly $1 billion in assistance to Ukraine for the Department of State, USAID, and the Department of Defense to counter the malign influence of Russia and respond to emerging needs related to security, energy, cybersecurity issues, disinformation, macroeconomic stabilization and resilience of civil society.

The Biden administration estimates the government is on track to cut the budget by $1.3 trillion this year, the largest one-year cut in US history. He credits Biden’s policies – namely last year’s US bailout – with reducing the deficit, as well as a 5.7% growth in the economy in 2021 and a current unemployment rate of just 3. .8%.

“This record economic and job growth has allowed us to responsibly and meaningfully reduce emergency spending,” Biden said. “We are reducing the size of the deficit relative to our economy by nearly two-thirds, reducing inflationary pressures and making real progress in cleaning up the fiscal mess I inherited.”

It also includes investing in job creation, increasing the supply of affordable housing, boosting manufacturing and expanding ocean freight capacity to move goods faster through ports and waterways. waterways, one of the factors that led to the highest inflation the United States has seen in 40 years.

On climate change, Biden’s plan includes $3.3 billion to support clean energy projects, as well as investments in climate resilience, adaptation programs and efforts to fight fires of forest.

COVID-19 itself is not a major focus in the budget. The White House only mentioned the virus a handful of times in a proposal fact sheet, including investments to address global health and safety challenges, prepare for future pandemics and more. biological threats, and strengthen the Centers for Disease Control and Prevention and local authorities. public health agencies.

The White House has warned in recent weeks that many COVID-19 response programs could be reduced or significantly reduced if Congress does not pass an emergency funding bill soon. The Biden administration is seeking a $22.5 billion package.

Predictably, many Democrats supported Biden’s budget request, while Republicans largely criticized it.

“President Biden has delivered a responsible and compassionate budget that will build a better, stronger, safer and more inclusive nation for decades to come – while cutting costs for American families, creating a fairer tax code and improving the long-term economic outlook,” House Budget Committee Chairman Rep. John Yarmuth, D-Ky, said in a statement. statement monday.

“President Biden likes to say ‘show me your budget and I’ll tell you what you value,'” said panelist Rep. Jason Smith, R-Mo. wrote in his own statement. “What this budget shows is that President Biden values ​​more spending, more debt, more taxes, and more pain for the American people.”

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