President Joe Biden’s “Build Back Better” agenda will add up to $4.3 trillion to the national debt over a 10-year period, based on a new analysis from the Committee for a Responsible Federal Budget.
“Overall, we estimate these packages could cost as much as $2.4 trillion over ten years and set the stage for up to $4.3 trillion of total borrowing over the next decade,” reads the latest CRFB analysis released on Wednesday. “This cost would lift debt to 119 percent of Gross Domestic Product (GDP) by 2031, compared to a record 106.4 percent of GDP projected under current law.”
Biden said that his “Build Back Better” agenda will be fully paid for over time.
“The investments I am proposing will be fully paid for over the long term by having the largest corporations, including the 55 corporations that paid zero federal tax last year, and the super wealthy begin to pay their fair share,” Biden said in a speech at the White House on Wednesday.
“They’ll still make a lot of money, but pay their fair share. That means it will actually reduce the national debt, improve our fiscal position over the long run. My Build Back Better agenda is fiscally responsible — the fiscally responsible way to reduce costs for families,” he added.
Marc Goldwein, senior vice president and senior policy director at CRFB, told Just the News that the “new programs and policies” Biden has proposed so far, including the Senate-passed infrastructure bill the president helped negotiate, are approaching $6 trillion of total spending.
He said the CRFB analysis on the amount of debt that would result from those policies, $4.3 trillion, includes Biden’s proposed tax increases on corporations and individuals in the top income tax bracket.
“It's $2.4 trillion of direct and it's $4.3 trillion including indirect; and by indirect we mean, is it creating new programs and making them temporary or are they going to be extended?” Goldwein said on Thursday. “And so, if we count the cost of extending those programs, it’s $4.3 trillion.”
Scott Hodge, president of the Tax Foundation, said he disagrees with Biden's statement that his spending plans are going to be paid for in the long term.
"Only in Washington could someone claim that using budget gimmicks, borrowed money, and higher taxes 'fully pays for' $3.5 trillion in new spending," he told Just the News.
The new spending in the Senate infrastructure bill is mainly dedicated to physical infrastructure initiatives. The $3.5 trillion reconciliation proposal includes new spending programs related to tuition free community college, universal pre-K, support for child care, Medicaid expansion, the creation of a Civilian Climate Corps and more. Once the proposal is turned into formal legislative language, it will be put up for a final vote on the Senate floor. The budget bill can pass with every Democratic senators' vote plus Vice President Kamala Harris as the tie-breaking vote.
“The Senate has basically said they'll borrow up to $1.75 trillion for their reconciliation package,” Goldwein said.
The White House has placed doubt on a Congressional Budget Office analysis that the bipartisan $1.2 infrastructure bill will add $256 billion in deficits over 10 years.
“The CBO score, which projects a $30 billion deficit a year for eight years, does not count real savings agreed to on a bipartisan basis. That includes over $200 billion in lower costs for emergency programs, like paid leave, over the last year than CBO had originally estimated, and over $60 billion in higher spectrum revenue from a February auction than CBO had anticipated,” White House Press Secretary Jen Psaki said. “Also, it doesn't include the positive effects of the economic growth this package will drive on the budget.”
CRFB estimates that the infrastructure bill alone will add $340 billion to deficits over 10 years and ultimately cost $400 billion. Goldwein explained that the White House and senators are using budget “gimmicks” for their estimate of the legislation’s cost and "significantly overstating" offsets.
“The infrastructure package is going to cost about $400 billion,” Goldwein said. "They could change it in the House but as of now, the Senate-passed version is not fully paid for; not over any time window. It wouldn't be fully paid for if you look 50 years in the future.”
The total national debt is approaching $29 trillion.