Biden's $1.5 Trillion Budget Request Would Fund All Nails Needed for the Coffin of Fiscal Restraint
The White House is proposing an 8.4 percent boost in discretionary spending, which comes on top of Biden's $1.9 trillion pandemic relief bill, and his proposed $2.3 trillion American Jobs Plan.
Despite the record amounts of money the federal government has spent over the last year responding to the pandemic—and the record deficits it's racked up in the process—the Biden administration continues to ask for trillions more.
Today, the White House released its first budget request. It has asked Congress to approve a $1.52 trillion budget, including $769 billion in non-defense discretionary spending (a 16 percent increase over fiscal year 2021) and $753 billion in defense spending (a 1.7 percent increase).
That would represent an overall 8.4 percent increase in federal spending from last year, when excluding the recent $1.9 trillion pandemic relief bill that Biden signed in March, reports Bloomberg. Today's budget request also comes in addition to the $2.3 trillion American Jobs Plan that Biden unveiled last week.
Taken together, this represents a massive fiscal expansion of the federal government and one that comes at a time of ballooning deficits.
The feds ran a budget deficit of $1.7 trillion in the first six months of fiscal year 2021 (which runs from October 2020 through September 2021), reported the Congressional Budget Office (CBO) yesterday.
That's a $1 trillion increase from the same period last year and was driven almost entirely by additional pandemic spending on things like unemployment benefits, small business aid, and refundable tax credits, writes the CBO.
The budget deficit for the first six months of fiscal year 2019—which predates our pandemic spending splurge—was $693 billion.
Like his past spending proposals, Biden's budget request includes huge funding boosts for federal agencies. The Associated Press reports he's asking for a 41 percent boost in Education Department funding, and a 23 percent increase in spending on the Department of Health and Human Services. The government's climate change efforts would get a $14 billion bump, while appropriations for the Department of Housing and Urban Development would jump 15 percent.
It's hardly surprising that a Democratic administration would want to spend more money on health, education, and housing. The sheer size of Biden's proposed budget, however, is galling.
The Wall Street Journal's Greg Ip sees in the president's budget requests a new left-wing "Bidenomics" that has no patience for traditional concerns about budget deficits, inflation, or fears that government spending will crowd out private investment.
"Bidenomics is more a political movement than a school of economic thought," writes Ip, saying that Biden and the Democratic Party's left-wing base see massive federal spending as a tool "to reshape the economy and society for years to come."
"The problem with economic policies subordinated to political imperatives is that they have no limiting principle: if $3 trillion in stimulus is OK, why not $6 trillion? If a $15 minimum wage is harmless, why not $30?" he adds.
Or as Reason's Peter Suderman wrote just yesterday: "Biden seems to believe that bigger government is definitionally better government, almost independent of the policy specifics, so he's pushing for bigger government just about any way he can."
An $800 billion stimulus bill passed to combat the Great Recession sparked the Tea Party. Today, even the reaction to Biden's $2 trillion American Jobs Plan is far more muted. Sizable majorities of voters support individual spending items in it in recent polls.
White House budget requests are political documents, and this will kick off months of negotiations. The topline $1.5 trillion figure could shrink somewhat.
But these are still dark days for anyone worried about the effects of endlessly increasing deficits, or the distortionary effects of creeping federal interventions into every market and corner of American life.
