The real cost of Biden's spending plan

President Biden’s tax and duty plan received what should be a pair of knockouts late last week. The report of soaring inflation has been ...

President Biden’s tax and duty plan received what should be a pair of knockouts late last week. The report of soaring inflation has been well covered. But the media largely ignored the second blow – the real cost of the plan if it is honestly marked. Let us complete the file.

We’ve been telling you for months that the announced cost of the $ 1.75 trillion 10-year plan includes several budget gimmicks that conceal the true cost. Penn Wharton’s budget model put the 10-year cost at around $ 4.6 trillion, but the White House continues to argue against all evidence that the cost is “zero.”

Now comes the Congressional Budget Office to point out that claiming zero cost is a Big Con. The CBO, a political group accountable to Congress, cannot be so blunt. It is constrained by budget conventions imposed by Congress. But even under those conventions, the CBO said the bill would add $ 200 billion to the deficit over 10 years.

Enter Sens. Lindsey Graham and John Cornyn, who asked CBO Director Phillip Swagel to add up the cost of the bill that was recently passed by the House if all of its agendas became permanent. This is more honest accounting as Democrats admit both wanting to make spending permanent and adjusting programs to make them follow Senate budget rules so they can get by with just 51 votes (including Vice President Kamala Harris).

Mr. Swagel’s response, sent on Friday, is a torpedo hitting the hull of Build Back Better. The dishonesty of the total spending of $ 1.75 trillion is astonishing, even by congressional standards.

Take family allowances, which Democrats say will only cost $ 185 billion because they end after a year. Nobody thinks they won’t extend it next year, and the year after, indefinitely. The CBO says the actual cost over 10 years is $ 1.597 trillion. Democrats are also setting their expansion of the labor income tax credit at a cost of $ 13 billion because it also ends after one year. The CBO says the real cost is $ 135 billion over 10 years.

Fair accounting of these two programs alone consumes $ 1.732 billion, almost all of the $ 1.75 billion that Senator Joe Manchin says is the most total new spending he will support in 10 year.

But there is so much more. Democrats are phasing out child care and kindergarten rights after 2027 at a total cost of $ 381 billion. The CBO says the real cost over 10 years is $ 752 billion if made permanent. They also underestimate the cost of the expanded healthcare subsidies to $ 74 billion by phasing them out in 2025 or 2026. The CBO says the real cost is $ 220 billion.

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And don’t forget the spending 10 years after the grants for all of these new programs become part of American behavior. This is the main goal of turning these programs into rights – to make people more dependent on government from cradle to grave.

One of the biggest tricks of the bill is its reinstatement of the national and local tax deduction to $ 80,000 from $ 10,000. Democrats claim this will raise $ 15 billion over 10 years, as the current $ 10,000 limit will expire after 2025. The CBO says the actual cost of this Democratic tax deduction to the wealthy without the gimmick would be $ 245 billion. of dollars.

We could go on and we recommend that people check out Mr. Swagel’s letter on the CBO website. The 18 programs Mr. Swagel details in a table with his letter contribute $ 3,477 billion over 10 years to the total cost of the House bill, compared to the $ 889 billion Democrats claim the same programs have cost under their fancy rules.

Overall, Mr Swagel says in his letter, the CBO and the Joint Committee on Taxation project that the House bill would increase the deficit by $ 3 trillion over 10 years without the budget tricks and sham cuts. .

Democratic leaders

Nancy Pelosi

and Chuck Schumer reacted with fury to the news, falling back on his claims that the Build Back Better Act is “fully paid.” Ms Pelosi says the CBO branded Mr Graham’s “imaginary bill”. But his bill is the real fiscal fantasy and “fully paid” is the lie of the year.

All of this gives Mr Manchin, and the other Democrats who hide behind his skepticism, enough ammunition to undo it all. If this bill passes, they will own all the deficits, the debt and the resulting inflation.

Newspaper Editorial Report: Best and Worst of the Week by Kim Strassel, Bill McGurn, Jillian Melchior and Dan Henninger. Images: AFP via Getty Images Composite: Mark Kelly

Copyright © 2021 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

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Newsrust - US Top News: The real cost of Biden's spending plan
The real cost of Biden's spending plan
Newsrust - US Top News
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