The Corner

Fiscal Policy

How Many Trillions Will the Democrats Blow Next?

President Biden makes remarks from the White House in Washington, D.C., March 6, 2021. (Erin Scott/Reuters)

Soon after taking power, the Democrats topped off previous COVID-relief efforts with an unnecessary $2 trillion bill, much of which didn’t have any plausible connection to COVID. Now, as I discussed last week, they’re planning to burn another large sum, perhaps in the range of $2–4 trillion, on infrastructure, jobs, and assorted odds and ends.

Biden press secretary Jen Psaki tweets that the details are still not final: The president is “considering a range of options, scopes and sizes of plans and will discuss with his policy team in days ahead, but speculation is premature, given [Biden] does not plan to lay out additional details this week.”

The Washington Post managed to get some insider info, though. White House aides are aiming to present Biden with a package costing $3 trillion — about $9,000 for every individual living in this country. In addition to pumping massive sums into American infrastructure (which, as I noted last week, is not in fact “crumbling”), it would extend the COVID bill’s controversial “child allowance” for a few more years, make community college free (which I guess isn’t as bad as, say, forgiving all student debt), and subsidize child care (which deliberately blunts a big advantage of stay-at-home parenting).

And while the “COVID relief” bill was simply added to the deficit, this time around the Democrats will pay for at least some of their spending with tax hikes. Options include hiking the corporate rate from 21 to 28 percent and raising taxes on wealthy individuals. Biden has said he won’t hike taxes on “anyone” making less than $400,000, but some of the corporate tax is borne by workers, not even corporate shareholders are universally rich, and when Biden said “anyone” apparently he was including married couples whose income exceeds that threshold only when both spouses’ earnings are combined.

There’s a lot of talk about the filibuster these days, but the filibuster can’t stop this if Democrats use the same “budget reconciliation” process they used to pass the COVID bill. That process is limited to matters that affect the budget. But you know what affects the budget? Shoveling tons of federal money out the door and hiking taxes.


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