US President Joe Biden on Thursday presented the budget for the fiscal year 2024 and unveiled the government's plans to cut $3 trillion from the fiscal deficit over the next decade by raising taxes for the rich.
Overall, the budget would increase federal spending from $6.2 trillion to $6.8 trillion in the one year starting in October.
Biden plans to boost military spending to stop China and Russia from moving beyond their borders, support down payments for first-time homebuyers, extend healthcare subsidies for the country's aging population, guarantee preschool for all the country's four million four-year-olds, funding cancer research to cut the death rate from that disease in half and improve rail safety after recent accidents.
Focus on Penssylvania blue-collar workers
Biden speaking about the Penssylvania blue-collar workers at the Philadelphia union hall said, "For too long, working people have been breaking their necks, the economy's left them behind - working people like you - while those at the top get away with everything." Biden in his 2020 presidential campaign had also focused on the told Pennsylvania blue-collar workers.
Opposition from Republican lawmakers
The Democratic President’s budget proposal faces stiff opposition from Republican lawmakers, and a large part of his agenda is unlikely to be enacted by this Congress.
However, the plan presented by him is a political statement that directly challenges Republican House Speaker Kevin McCarthy's threats to obstruct an increase in the $31.4 trillion limit on federal borrowing unless the President agrees to rein in federal spending.
In his statement he directly challenged the speaker when he said, "I want to make it clear I'm ready to meet with the speaker anytime, tomorrow, if he has his budget. Lay it down, tell me what you want to do. I'll show you what I want to do, see what we can agree on."
Biden, when talking to the reporters outside the White House, asked for areas of possible compromise with Republicans and said, ‘we will wait to see their budget.’
Republican House Speaker Kevin McCarthy and other Republicans described Biden's budget plan as "reckless."
Maya MacGuineas, president of the Committee for a Responsible Federal Budget advocacy group, in a statement said,"When it comes to fixing the debt, this is by no means an award-winning budget, but the president deserves at least a participation trophy."
The Republicans are also planning $150 billion in cuts to non-defense discretionary programs, cuts in foreign aid and programs aimed at preventing sexually transmitted diseases and about $25 billion from the Department Education. This, according to them, would save $1.5 trillion over a decade.
Tax on rich
The White House said that Biden seeks to fund higher spending and narrow the deficit by imposing a 25 per cent minimum tax on billionaires and almost doubling the capital gains tax from 20 per cent. The president also wants to increase a 1 per cent stock buyback tax, which would impact the investors that he would need to contact in order to finance any re-election campaign. Some corporate tax breaks enacted in 2017 under former President Donald Trump could also be pulled back.
Increasing aging US population
According to the US Census, one in five Americans will be at retirement age or older by 2030 and the budget makes it clear that the aging US population means that legally mandated spending on social programs will continue to be a long-term drag.
Increasing US debt
Even if the higher taxes and cost-cutting measures of the budget are accepted it still projects over $1 trillion deficits every year over the next decade.
The total US debt would increase to approximately 110 per cent of annual gross domestic product in 2033. This increasing number rivals the peaks during the country's mobilisation for World War II.
The budget by the administration is based on a muted, 0.6 percent inflation-adjusted growth forecast for this year.
Unemployment
The unemployment in the US is moving to 4.6 per cent in 2024 as the Federal Reserve is attempting a slowdown to fight inflation. It is also predicted that the efforts by the Federal Reserve will succeed in getting consumer prices down by approximately two-thirds by next year.
The president proposed increase in funding for crime prevention and border patrol, an issue frequently pointed by the Republicans. He also spoke about measures on paid leave, climate and funding for schools in high-poverty neighborhoods.
