WASHINGTON (CN) — The Biden administration on Friday released its $6 trillion budget proposal, a package that pits the president’s push to revamp the nation’s infrastructure and social programs against a ballooning national debt.
A president’s budget proposal is not set in stone, but rather is more like a grand vision with dollars and cents attached to each ambition.
The proposed budget is for the fiscal year starting Oct. 1 and projects spending for the next decade. In it, the administration has factored in its pandemic recovery costs as well as existing expenses like Social Security and Medicare.
The White House also incorporated the $2.3 trillion infrastructure proposal that is still being negotiated, as well as the president’s $1.8 trillion American Families Plan that includes significant investments in child care, paid family leave and education.
Both packages will hike up deficits, but the Biden administration contends the boost in spending would ultimately even out as tax revenue from the nation’s wealthiest individuals and corporations would help pick up the tab.
While the budget features just over $1.5 trillion in discretionary spending for things like the military, health care and renewable energy development, it also shifts some military spending to research programs for renewable energy.
Renewable energy research and development overall would get a 16.5% boost if legislators can agree on the budget when they start appropriating the funds later this year.
Building back the economy and reinvigorating aging infrastructure has been a key plank in Biden’s policy agenda. His budget reflects that with over $4.5 trillion allotted over 10 years just for infrastructure programs.
Paid family leave and universal preschool are also factored in at $3.5 billion for fiscal year 2022.
House Ways and Means Committee Chair Richard Neal, a Massachusetts Democrat, commended Biden’s proposed budget Friday, saying it will make “the road to a full recovery” from the pandemic more inclusive for more Americans.
“This president is willing to make the bold investments necessary to put our country on a sustainable and secure path forward. Ways and Means Democrats will consider the administration’s proposals carefully and look forward to working together to achieve our shared goals,” Neal said in a statement.
But the budget does increase the deficit by about $1.4 trillion over the next decade, a sticking point for fiscal conservatives and other budget hawks.
The Committee for a Responsible Federal Budget partly panned the proposal. Its president, Maya MacGuineas, said in a statement Friday that the group was "encouraged" to see concrete proposals for paying for the spending but argued the budgetary blueprint was gamed out over too long a period, especially as debt continues to steadily rise.
“The budget proposes $5 trillion of spending and tax breaks and only pays for three-quarters of the cost, leaving nearly $1.4 trillion of higher debt. Debt under the budget would hit new records almost every year,” she said.
While it would begin to reduce deficits by the end of 2031, more tax revenue will be necessary to finance rising health care and retirement costs, MacGuineas added.
The president’s budget, however, has factored in $200 billion just for subsidy increases under the Affordable Care Act and those subsidies would be made permanent.
Celia Rouse, chair of the Council of Economic Advisers, said Friday she expects that with the U.S. coming back online slowly but surely after the pandemic stall, the economy is likely to exceed its prediction of 5.2% growth this year.
The White House said it expects the growth rate hit 4.3% next year, and then grow just under 2% for the following eight years.
The administration also expects the unemployment rate to fall from about 6% now to just 4.1% next year. For the remainder of the decade, the White House estimates it will stay steady at 3.8%.
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.
