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Thanks, GOP. Don’t get out of the way of the Biden spending and taxing disaster

“Get out of the way,” President Biden urged. He says if the Republicans are not willing to work with the Democrats to raise the debt ceiling and approve massive spending and tax bills,  they should just get out of the way so the Dems can do it.  Most of us are hoping the GOP senators and the two moderate Democrat senators stay in the way.

Biden knows that the debt ceiling must be raised. That’s because the current ceiling of $28.5 trillion has already been exceeded. The US reached the $28.5 trillion mark at the end of July  For August, September, and part of October, Treasury Secretary Janet Yellen was able to take unspent money from one place and use it to allow the federal government to keep spending.

She essentially “robbed Peter to pay Paul.”
Since the federal government receives just over $300 billion monthly in tax revenue and spends roughly $550 billion per month, the public debt is really already over $29 trillion. The GOP knows the ceiling must be raised but they fear a large increase in the Public Debt will create an over-burdened and potentially stagnated economy.

Some Dems want to completely eliminate the debt ceiling which would allow the federal government to spend as much as it desired without any regard for future generations.  If they can’t get that, the Dems want the debt ceiling raised high enough to allow them to pass their massive $5 trillion spending plans. No Republican Senators support this.

The reason the GOP is standing in the way is simply that the vast majority of Americans oppose his plans.

“Not so,” Biden would claim. He says he was elected to implement these programs.

But many of those who voted for Biden seem to regret it now that they know the full extent of his programs.  A Zogby Analytics poll taken last month concluded that 20% of Biden voters regret their decision to vote for him.  Much of the regret apparently comes from the tax increases in his spending bills.

In fact, one poll just found that 71.5% of Americans do not support Biden’s spending plans if it means they pay higher taxes and if the plan increases the Public Debt. Although Biden recently said, “The Build Back Better  Agenda costs zero and adds zero dollars to the Public debt.” and he said, “The plan will ensure that the ultra-wealthy pay their fair share and won’t raise taxes on anyone making less than $400k per year.”

Very few Americans believe those statements. Spending another $5 trillion can’t cost zero, unless government spending in other areas is cut.  With 60% of the government’s non-COVID spending going to Social Security, Medicare, and Medicaid and 10% going to interest on the Public Debt, big cuts in government spending are virtually impossible.

This is especially true when Biden’s spending plans call for massively increased funding for social programs.

Some studies say that households earning as low as $20,000 will see their taxes increased. It seems to make sense that trying to raise two or three trillion dollars through tax increases will result in an increased tax burden on virtually all Americans.

Even if a household’s taxes do not go up directly, the higher prices from corporations passing on the corporate tax increase will result in a loss of purchasing power. And, by over-taxing the wealthy who produce the vast majority of new capital, the economy will slow and inflation will increase. That hurts all Americans at every income level, but rising prices are felt the most by the lowest income earners.

We should be thankful that every member of the GOP and two Democrat senators refuse to get out of the way.  The majority of Americans will thank them for standing up against the largest tax increase in history as well as the largest increase in government spending ever.

These Biden proposals are simply wrong for the country. While they may appear to help the lowest income earners, the best way to help them is to give them the opportunity to earn their own money instead of just giving them free money which is taken from a taxpayer who actually earned it.

Taking massive amounts of income away from those who earned it and giving it to those who, for whatever reason, did not earn it, is simply a bad idea.

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Michael Busler

Michael Busler, Ph.D. is a public policy analyst and a Professor of Finance at Stockton University where he teaches undergraduate and graduate courses in Finance and Economics. He has written Op-ed columns in major newspapers for more than 35 years.

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