Oh No, Joe Biden's Budget Really Gonna Eat The Rich This Time, Get Ready Rich!
So stringy. A bit gamy as well.
Yr Doktor Zoom is an old man, which means I remember the fairly big news back in the '80s when Democrats announced Ronald Reagan's plan for the federal budget would be "dead on arrival" in Congress. Reagan's administration would write up a budget plan that would include massive cuts to federal spending, and those cuts would never pass, because for some reason Americans seemed to like having Medicare and Social Security, while Republicans were only willing to support the tax cuts and military spending sides of Reagan's agenda.
Then all the supply-siders would say the only reason Reagan's 1981 tax cuts for the wealthiest Americans hadn't "paid for themselves" through enormous gains in prosperity was that government spending still needed to be slashed, forever and for always, and there you have the basics of Republican economic policy going back 40 years, although subsequent GOP tax cuts have generally skipped over the "spending cuts" part, except maybe when said spending might help people Republicans believe need to be hurt.
Since then, it's been rare for presidential budgets to be seen as anything more than an annual priority-setting exercise. Sometimes Congress will actually produce legislation that aligns with some of the president's budget requests; Biden's proposed budget last year centered on his two big economic proposals, the American Jobs Plan and the American Family Plan , which all together called for $5 trillion in new spending over 10 years, offset by rollbacks of most of Donald Trump's 2017 tax cuts for rich fuckwads. Congress did at least take a shot at turning the proposals into real legislation, in the form of the Bipartisan Infrastructure Bill, which passed, and the Build Back Better reconciliation bill, which kept getting whittled down until it was finally murdered by a coal CEO posing as a Democrat.
Biden's first budget proposal reflected his desires to get government back in the business of doing big things that would materially improve Americans' lives. His 2023 budget is still ambitious, but it also shows the influence of that coal CEO on Biden's agenda. As the Washington Post notes, it's also a budget tailored to the midterm elections, with an eye on fending off GOP criticism of perceived Democratic weaknesses (lots of money for police and the military, lots of talk about reducing debt and inflation), but with substantial spending targeted at Democratic priorities like climate and the environment, too.
Tax The Rich, Yay! Reduce the Deficit, Meh.
The $5.8 trillion budget is aimed at cutting the federal budget deficit, mostly by raising taxes on the wealthiest Americans. The plan would raise $2.5 trillion in new revenues over 10 yearsthrough new taxes on corporations and the top individual earners. Part of that would come from a new "Billionaire Minimum Income Tax" that would affect only households with over $100 million in assets, which is the top hundredth of one percent of all Americans. Those folks, about 700 billionaire families, would have to pay 20 percent of their income over $100 million on both income and "unrealized gains," which is the amount their investments have gained in value, even if they haven't sold stock or property. The new tax, if approved by Congress, would raise some $360 billion over the next decade.
The Associated Press ' splains how that would work:
Biden’s proposal would allow wealthy households to spread some payments on unrealized gains over nine years, and then for five years on new income going forward. Stretching payments over multiple years is meant to smooth yearly variations in investment income, while still ensuring that the wealthiest end up paying a minimum tax rate of 20%. In effect, the Billionaire Minimum Income Tax payments are a prepayment of tax obligations these households will owe when they later realize their gains.
David Gamage, a tax law prof at Indiana University, told the AP that since the tax is on increases in the value of assets, not the assets themselves, it's
"not a wealth tax, it’s an income tax reform.” He says, “This is a minimum income tax that includes the true economic value” of income that can be held for a very long time, he said.
During his press conference announcing the budget proposal yesterday, Biden said the new tax would close some of the tax gap between ordinary taxpayers and the very, very rich, who pay a far smaller portion of their income in taxes than the rest of us. Noting that the top 700 richest Americans increased their wealth by about a trillion dollars last year while paying an effective tax rate of just eight percent, Biden said, "A firefighter and a teacher pay more than double” the rate in taxes billionaires get away with.
Along with other revenue enhancers, like a return of the top individual tax rate to 39.6 percent and an increase in the top corporate rate to 28 percent, Biden's budget would bring in new revenue of $1.4 trillion over a decade, which Biden said would result in a trillion-dollar reduction in the federal deficit over 10 years.
Whether Sen. Kirsten Sinema would be on board with any tax rate increases is debatable; last year, she killed a proposal for the same increases as part of Build Back Better.
Cops And Troops And Midterms
The budget calls for $30 billion in new funding for local policing, as well as a 10 percent increase in defense spending, because no president is going to cut defense spending in an election year, at least not while there's a war in Ukraine.
The spending on police isn't all aimed at heading off GOP claims that Democrats want to "defund the police;" some $17.4 billion is requested to boost federal law enforcement funding for violent crime reduction, but that includes $1.7 billion for the Bureau of Alcohol, Tobacco, Firearms and Explosives to take on illegal gun trafficking, which is absolutely a good use of money. Another $1 billion would help enforce the just-renewed Violence Against Women Act, including funding to provide services for LGBTQ survivors, and a $72 million increase in funding to process the backlog of rape kits, for a total of $120 million.
Also too, the budget would ramp up Justice Department funding for antitrust prosecutions, as well as money for the Bureau of Prisons to overcome staffing shortages, and more money for immigration courts so they can address a huge backlog in asylum claims — with additional funding to provide attorneys for immigrants who can't afford legal help.
The increased defense spending is getting pushback from progressives, who seem to think America spends too much on its bloated military already, and that, as Rep. Pramila Jayapal (D-Washington) said on Twitter, "We do not need to raise the defense budget by another $31 billion," to over $800 billion for next year. Instead, Jayapal said, the funding would go a lot farther if invested in our communities.
Climate: Far Better Than Trump, Not As Much As The Emergency Demands
As E&E News explains, there's a lot of good stuff for the environment in the budget proposal, a total of $44.9 billion for the climate crisis, which is an increase of $16.7 billion over fiscal 2021 spending. (The proposal doesn't include comparisons to fiscal '22 spending, which was only passed in the Omnibus spending bill earlier this month.) Here's an outline of the major Biden climate budget asks, with '22 figures added in by E&E News:
• EPA’s proposed $11.9 billion budget for fiscal 2023 would be a 25 percent increase over current spending of $9.5 billion. However, Biden made a similar proposal for fiscal 2022 that Congress scaled back to only a 3 percent increase.
• The Energy Department’s proposed $48.2 billion budget for fiscal 2023 would be a 7 percent increase over current spending of $44.9 billion. However, a similar increase proposed for fiscal 2022 was whittled back to about 5 percent by lawmakers.
• The Interior Department’s proposed $17.5 billion request for fiscal 2023 would be a 24 percent hike over current spending of $14.1 billion. But Congress scaled back the request to 5 percent for fiscal 2022.
Grist has more on the details, like increased EPA spending on upgrading drinking water and wastewater infrastructure, hazardous waste cleanup, and cleanup of so-called "forever chemicals," aka polyfluoroalkyl substances, or PFAS, which are extremely damn nasty.
It would also promote more clean energy investments, reductions in carbon emissions, and funding to weatherize buildings, especially in public housing and low-income homes. On top of that, there'd be increased funding for climate research and clean energy development. Funding for the National Parks Service would increase, and the budget includes $31 million for Biden's Civilian Climate Corps, to get the Youths out there making parks and federal lands more climate resilient. There's also funding requested to help with environmental justice, and to help communities that have depended on fossil fuel jobs transition to clean energy industries.
All very good things, at least until you start looking at all that money going to the military , which is one of the biggest polluters in America and so far hasn't been required to reduce its greenhouse gas emissions, because national defense can't possibly include measures that might leave us with a nation worth defending.
As we say, though: Presidential budgets are at most a wish list, and what really matters will be what Congress can be pushed to pass. Let's all yell a lot about climate, and for Crom's sake don't elect Republicans, who are openly committed to fucking us all over again.
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