Biden’s budget takes aim at GOP
President trying to force the Republicans’ hand
WASHINGTON – President Joe Biden will dare Republicans to reveal which government programs they want cut as he lays out his budget proposal Thursday that funds Medicare and Social Security long term by increasing taxes on the wealthy – and sets the stage for a 2024 reelection campaign.
To mark the unveiling of his budget for the next fiscal year, Biden returns to Philadelphia, a city in a critical battleground state that he’s turned to for major political moments including the rollout of his 2020 presidential campaign and a primetime speech on the fate of democracy.
Something as mundane as a federal government budget might not seem in the same category. But a stalemate with Republicans over increasing the debt ceiling – one that could force the U.S. into default and cripple the economy if an agreement isn’t reached – has raised the stakes.
What’s more, Biden will use his speech to double down on his pitch to working-class voters ahead of a widely expected reelection announcement as early as this spring. Biden, vowing to strengthen Medicare and Social Security, wants to draw a contrast with Republicans by posing a simple question: Here’s my plan. Where’s yours?
What we know about the budget and debt ceiling
⬤ Taxing the wealthy: The White House said Biden’s budget will reduce federal budget deficits by $3 trillion over the next 10 years by raising taxes on wealthy Americans and corporations. Biden also wants to quadruple a new tax on corporate stock buybacks. He’s repeatedly said no one earning less than $400,000 a year would see their taxes increased.
⬤ Medicare solvency: One of the proposals is raising the Medicare tax rate from 3.8% to 5% on high-income earners to make Medicare solvent financially beyond 2050. The hike would also fund benefit changes including limiting to $2 how much a Medicare recipient must pay out-ofpocket for certain generic drugs.
Social Security plan still unclear:
The White House hasn’t detailed a similar tax plan for funding Social Security but said the budget will “strengthen and protect” the program.
⬤ Approval isn’t the point: Biden’s budget has no realistic shot to pass the Republican-controlled House. However, it sets Democrats’ spending priorities in talks to raise the cap on how much the U.S. can borrow. Congressional action to raise the debt ceiling is needed by the end of the summer, according to the Congressional Budget Office, to avert an economic crisis.
⬤ Exploding debt: Republicans, pointing to CBO projections that the U.S. will add $19 trillion to its national debt over the next decade, have demanded unspecified spending cuts in a package to raise the debt ceiling.
⬤ Biden’s hard line: Biden has said he won’t entertain any cuts and accused Republicans of wanting to target Medicare and Social Security, two major drivers of national debt that’s exploded to $31.4 trillion. House Speaker Kevin McCarthy has promised neither program will be touched, leaving Republicans with few options to achieve their goals of deficit reduction in 10 years while not increasing taxes.
The White House’s strategy to win debt ceiling fight
The White House is banking on GOP-backed spending cuts being so unpopular with Americans that some Republican lawmakers will abandon those demands, making it possible for Congress to raise the debt limit.
“Will they cut Social Security and Medicare? The Affordable Care Act?” Shalanda Young, director of the White House’s Office of Management and Budget, said in a video previewing Biden’s broad budget goals. “We don’t know until we see a plan. They owe that to the American people.”
Look for similar language from Biden in his remarks Thursday.
The Republican-led House Budget Committee floated potential cuts last month that included work requirements for food stamps, deep slashes to the Environmental Protection Agency, stopping “woke waste,” rescinding unspent COVID-19 rescue funds, reducing Obamacare subsidies
and halting Biden’s plan to forgive student loan debt. Their framework said Republicans want to “save and strengthen” Social and Medicare but didn’t say how.
Still, these actions would seemingly fall short of achieving McCarthy’s stated goal of eliminating the annual budget deficit.
Themes for 2024
Biden is working to frame himself as the protector of Social Security and Medicare – two of the federal government’s most popular programs – before he jumps in to the 2024 race for president.
He’s likely to contrast his budget Thursday with past GOP proposals targeting Social Security and Medicare, casting Republicans as threats to social welfare programs created by Franklin D. Roosevelt’s New Deal and Lyndon B. Johnson’s Great Society.
To drive home his economic message, Biden will discuss his budget at a Philadelphia union hall – the latest in several trips to union halls this year – as he argues his priorities value American workers.
It’s all part of Biden’s economic appeal to blue-collar voters in Rust Belt states like Pennsylvania, Michigan and Wisconsin who have increasingly abandoned the Democratic Party in recent years.
Biden won enough of voters who have not gone to college to narrowly win all three of these
Midwest battlegrounds in 2020, but he can’t lose many of them to repeat in 2024.
What they’re saying
⬤ “The biggest threat to Social Security are Republicans,” White House press secretary Karine Jean-Pierre said Tuesday, accusing them of having a “relentless drive” to cut benefits for Americans. “We look forward to Republicans sharing their plan with the American people.”
⬤ Biden, in a New York Times op-ed outlining his Medicare solvency plan, said “for decades I’ve listened to my Republican friends” talk about preserving Medicare through cuts. “Only in Washington can people claim that they are saving something by destroying it,” he said.
⬤ McCarthy says the White House is lying. “If you watch what the president is doing, he’s out there saying something that’s a lie about Republicans – that we want to cut Social Security and Medicare,” McCarthy said Monday in an interview on CNBC. “We want to fix it.”
⬤ Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget, said she hopes the president’s budget will include measures for immediate deficit reduction to fight 40-year-high inflation. “It is critical that the budget blueprints do not include plans to increase deficits in the next two years.”