Taxes will increase for low- and middle-income individuals according to an early report by the New York Times on President Biden’s proposed budget. This bombshell negates President Biden’s oft-repeated pledge that he would not allow taxes to go up on lower or middle-income individuals and families.
This is the latest example of President Biden abandoning his lofty promise that he can fund trillions of dollars in new spending simply by taxing the wealthy or corporations alone. In fact, President Biden’s budget relies on expiration of middle-class tax cuts in order to achieve a historically high level of tax on Americans. In addition, President Biden’s trillions in wasteful spending will harm regular Americans with higher prices due to inflation—itself a “stealth tax” on regular consumers.
- President Biden Will Stoke Inflation and Increase the Deficit:
- An early report by the New York Times finds that “the United States would run significant deficits as it borrows money to finance his plans. Under Mr. Biden’s proposal, the federal budget deficit would hit $1.8 trillion in 2022, even as the economy rebounds from the pandemic recession to grow at what the administration predicts would be its fastest annual pace since the early 1980s.”
- The Return of the Bad Old Days with Slow Growth: The Obama-Biden administration famously accepted slow growth as America’s “new normal” while pursuing policies that sent jobs overseas. President Biden appears to be lowering the bar even further, by lowering expectations far below President Obama’s own final budget that predicted annual growth of about 2.3 percent on average.
- “By 2024, debt as a share of the economy would rise to its highest level in American history, eclipsing its World War II-era record.” Biden’s aides “predict that even if his full agenda were enacted, the economy would grow at just under 2 percent per year for most of the decade, after accounting for inflation. That rate is similar to the historically sluggish pace of growth that the nation has averaged over the past 20 years.”
- Lower and Middle Income Families Hit Hardest: Despite repeated pledges that he will not increase taxes on lower and middle-income earners earning less than $400,000 a year, President Biden’s budget assumes higher taxes for the middle class. How? By letting tax cuts expire.
- “By 2028, when Mr. Biden could be finishing a second term in office, the government would be collecting more tax revenue as a share of the economy than almost any point in modern statistical history.”