Will Democrats break the GOP’s deficit doom loop?

Republicans understand it. The rest of the country should, too. The real game-changer in President Joe Biden’s raft of policy proposals is the revenue he would raise from the wealthy.

Biden’s plans are routinely described as big, bold and progressive. This is incomplete. Yes, Biden is making ambitious efforts to grapple with long-standing shortfalls in public investment. But Biden has not cooked up some radical, untested concoction. He’s advancing programs that have been successful in states and in other well-off democratic nations. Many of his plans were proposed and vetted in Congress over the past decade. Team Biden knows familiarity breeds comfort and long-term coalitionbuilding.

His child-care plan, for example, draws heavily on proposals from Rep. Robert C. “Bobby” Scott, D-Va., and Sen. Patty Murray, D-Wash. Two years of free community college were first proposed in 2015. Child care, Scott says, “is not just vetted as an idea legislatively in the United States, these are things that … most countries have just been doing routinely; they’re not unusual on an international basis.” And 17 states already offer tuition-free community college.

Here’s an analogy to President Franklin Roosevelt that often goes unmentioned: The New Deal built on objectives advanced in the 1920s by progressives in Congress and at the state level. Similarly, President Ronald Reagan’s revolution built on conservative thinking in the previous decade.

Nonetheless, what’s really bold is Biden’s effort to create a stream of revenue through higher taxes on the wealthy and corporations that would support his efforts on education, child care, infrastructure and more help for low-income families.

Biden’s tax program, including an effort to make it harder for corporations and the well-todo to evade what they owe, is designed to break a vicious cycle. Since the early 1990s, Democrats coming into office after a GOP era have had to raise taxes just to ease deficits Republican tax cuts created. Then, when Republicans came back into power, they enacted more tax cuts (often accompanied by higher levels of military spending).

This process has contributed to a revenue shortfall over time. Federal revenue as a share of gross domestic product has dropped from 20% in 2000 to 16.3% in 2019. The Center on Budget and Policy Priorities found that if federal revenue returned to 20% of GDP — a long way from socialism — the government would collect some $680 billion more in 2022 than it would under current law.

Biden’s tax increases amount to just 1.2% of GDP over the next decade, and they are confined to the very rich for good reason: The income gains at the top of the economy over the past four decades dwarf those of everyone else. According to the Congressional Budget Office, incomes in the top 0.01% of households grew 601% between 1979 and 2017. The middle three-fifths of Americans gained just 49% over the same period. Many of the wealthy pay lower rates on their income than taxpayers earning much less because some two-fifths of the incomes of the top 1% come from capital, which is taxed far more lightly than labor income.

As we refuse to ask wealthy Americans to chip in a little more, our nation will continue to underinvest in public goods, accept wide opportunity gaps between rich and poor children, and do little or nothing to ease the struggles of two-income households.

Republicans will devote more time to fighting Biden’s tax increases than to criticizing particular programs he champions, as they have long counted on the deficit doom loop to block social progress. Democrats should have the courage and clarity to recognize what Republicans already know: It’s the revenue, stupid.