By Bruce Thompson
President Joe Biden and House Democrats have said their $2.4 trillion tax and spending bill is fully paid for. The cost is zero, the White House claims.
But the Congressional Budget Office estimate of the bill shows that it is not close to being fully paid for in each of the next five years. Instead, the bill would increase deficits by nearly $800 billion between now and 2026. Next year, the bill would spend $155 billion more than it generates from its revenue streams. Through 2026, the bill would increase the deficit by an average of $158 billion a year, spending $792 billion more than it collects and falling way short of covering the cost of the spending.
This huge injection of hundreds of billions of dollars of deficit spending would fuel more inflation and pile on more debt that our country cannot afford. What’s worse, the actual long-term cost of the bill would almost certainly be higher. The true costs of major provisions of the bill are hidden by budget gimmicks and early expiration dates. By using long-term savings to pay for short-term spending, the bill masks the real cost of the spending programs.
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The bill front-loads the spending, with two-thirds of the money spent in the first five years. The clear assumption is that this spending will be extended before it sunsets. According to a Penn Wharton analysis of the bill, a permanent extension of the spending provisions would increase the total cost by an additional $2.4 trillion. This would push the bill’s total cost to more than $4 trillion and result in more than $2 trillion in higher deficits.
With inflation rising at the fastest pace in years, we need to slow spending down. And not pass this bill.