The reality of the nation’s fiscal condition discredits Biden’s deficit-reduction boast.
Biden's claims to being fiscally responsible simply don't hold up.
D uring a speech in Phoenix over the weekend, President Biden boasted that his administration had reduced the deficit by $350 billion last year and $1 trillion this year. The president said, “I’m so sick of Republicans saying we’re the ‘big spenders.’ Give me a break. Give me a break.”
A closer look at federal spending and deficits under Biden’s watch reveals that the president may not be entitled to that break.
A recent analysis by the Committee for a Responsible Federal Budget (CRFB) found that the Biden administration has so far added more than $4.8 trillion to the budget deficit for the coming decade. This is on top of the $12.3 trillion baseline deficit that existed before Biden became president.
By comparison, the Trump administration had added $2.5 trillion to the deficit at this point in his term, while the Obama administration added a little over $800 billion to the baseline deficit during his first half term.
Comparing average federal spending levels as a share of gross domestic product, the Obama administration spent 23.2 percent of GDP per year over two terms, the Trump administration spent 24.5 percent per year over one term, and the Biden administration has so far spent 28.4 percent per year in his first half term.
In the face of these numbers, the president can only substantiate his claims to reducing the deficit by cherry-picking data. Comparing current deficit levels to those in 2020 and 2021 is comparing apples to oranges. These two years involved the worst of the Covid-19 pandemic and unprecedented levels of stimulus spending.
A deeper dive into recent changes in spending and revenues reveals how the administration’s claims of fiscal prudence don’t really hold up.
To be sure, the expiration of pandemic stimulus spending has dramatically reduced the government’s expenses. After passing a $900 billion Covid-relief bill in December 2020 and the $1.9 trillion American Rescue Plan in March 2021, the federal government outpaced its 2020 spending levels in FY 2021. Eighty-five percent and 83 percent of spending authorized under the Covid-relief bill and American Rescue Plan was spent in fiscal year 2021, making up 34 percent of total federal spending that year.
Now that Covid-related spending is tailing off, federal spending is down almost $1.5 trillion in the first eleven months of FY 2022 compared with 2021. But that’s no thanks to the president’s frugality. If we compare FY 2022 spending to pre-pandemic spending levels in FY 2019, spending is actually $1.2 trillion higher now — hardly a sign of fiscal prudence.
Far from attempting to curb federal spending during this time, the president spent much of 2021 touting a plan to spend an additional $2.3 trillion on his American Families Plan agenda, at least $1 trillion of which had no funding plans. Not to mention his attempts at selling his $2.1 trillion Build Back Better spending plans.
A more accurate measure of calculating this administration’s deficit reduction would be to compare actual budget deficits to budget forecasts released just three weeks after Biden’s inauguration.
The Congressional Budget Office projected combined deficit spending for financial years (FY) 2021 and 2022 to be around $3.3 trillion. Actual budget deficits during this period are already over $3.7 trillion, and FY 2022 isn’t over yet. In other words, the Biden administration exceeded the baseline estimates by more than $400 billion.
The reality of the nation’s fiscal condition discredits Biden’s deficit-reduction boast. Deficits are trillions of dollars larger due to enacted legislation and executive actions of the Biden administration.