Biden hints at billionaire tax and 'making people pay a fair share' as he gets ready to unveil his new budget
President Joe Biden has decided to get out of the White House to unveil his budget this week and instead promote it in Pennsylvania, a must-win state in 2024.
His trip to Philadelphia on Thursday is a sign that the president’s budget proposal will be a form of political messaging, not just an outline of the government’s finances.
The White House budget plan will be a “what if” document, aimed at telling voters what the federal government could do if Democrats were solidly in control of the White House and Congress. Right now, the Republican majority in the House opposes almost all of Biden’s ideas.
Biden hinted in a Monday speech that tax increases on the wealthy will be at the core of his budget plan, saying he will be proposing a tax that targets billionaires.
“Much of what we’re doing is about your right to be treated fairly, with dignity and with respect,” Biden said in his remarks to the International Association of Fire Fighters. “Part of that is making a tax system that’s fair. We can make all these improvements and still cut the deficit, if we start making people pay a fair share.”
Democrats and Republicans are jockeying to show the public who is the most fiscally responsible. It’s a key test as the White House and Congress will need to agree to lift the government’s borrowing authority at some point this summer, or else the government could default and send the U.S. economy into a severe recession.
Biden laid the groundwork for his upcoming budget in his State of the Union address last month and in other recent speeches. He’s pledged to trim deficits by a combined $2 trillion over 10 years, strengthen Social Security and Medicare and only raise taxes on people earning more than $400,000.
His proposal is in some ways far more ambitious than what he proposed in 2021, when his budget would have reduced the debt by $1 trillion over 10 years relative to projections.
House Speaker Kevin McCarthy, R-Calif., has called for putting the country on a path to a balanced budget, while leaving Social Security and Medicare untouched. But McCarthy has kept a poker face on how the GOP could do that and has refrained from committing to hard numbers.
House Budget Committee Chairman Jodey Arrington, R-Texas, put out a list of more than $750 billion worth of possible spending cuts in February. Atop the list was repealing Biden’s executive order providing some student debt forgiveness, which would restore roughly $400 billion to the federal coffers.
Arrington also included rescinding money tied to a “woke” agenda, as the GOP’s cultural and economic messaging have merged. He would eliminate $60 billion from the EPA that would go for environmental justice programs and get back $3.6 million meant to extend the Michelle Obama Trail in Georgia.
Phillip Swagel, director of the nonpartisan Congressional Budget Office, issued guidance on Monday saying that projected deficits would need to be cut by $5 trillion during the next decade to match the 50-year historical average.
“Returning primary deficits to their historical average is not a recommendation by CBO,” Swagel wrote as a caveat.
As Swagel outlined it, the political tradeoffs are clear. There could be $670 billion to $1.2 trillion that could be raised by removing the caps on the payroll taxes that fund Social Security. But the GOP opposes tax hikes and the increase would violate Biden’s promise to only raise taxes on those earning more than $400,000.
Pennsylvania makes for a solid test of the two competing ideological visions for the country. Biden won Pennsylvania by roughly a percentage point in 2020, a decidedly narrow victory. His appearance Thursday would be his 23rd trip to Pennsylvania since becoming president.
Last September, Biden stood on the steps of Philadelphia’s Independence Hall and warned that former President Donald Trump and his Republican adherents are “a threat to this country.” Trump’s defeat led to his supporters storming the U.S. Capitol on Jan. 6, 2021, with the apparent goal of blocking the certification of the 2020 election.
In the 2022 Pennsylvania Senate race, Democrat John Fetterman won by roughly five points despite voters’ concerns about the U.S. economy tied to high inflation.
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