President Biden recently released the budget proposal for the 2023 fiscal year. Here is a simplified rundown of the problems pointed out by the non-partisan organization, Concord Coalition.
Predictions for the Economy Are Unrealistic
The predictions used for the current budget were created before the war in Ukraine, and the recent rise in inflation, which means its optimistic outlook has zero justification — the promises of higher revenue, interest savings, and lower deficits are merely a pipe dream.
Deficits Are Getting Larger
Deficits, or the amount of overspending vs. a planned budget, were meant to decrease under the new budget. Instead, deficits get progressively larger over the 10-year budget window, made worse because overly-optimistic predictions support the budget.
It Includes a Gimmick
Biden’s Build Back Better (BBB) plan has faced much contention, but the administration still pushes for it. The budget plan features a “deficit-neutral reserve fund” for BBB v2.0, along with vague promises regarding “legislation that reduces costs, expands productive capacity, and reforms the tax system.” A blank slate allows the administration to do what they want with the funds as long as it fits under the BBB v2.0 umbrella.
The Cost of New Projects May Not Have Been Included
As mentioned, the plan for BBB v2.0 is inherently vague. It is difficult to determine whether or not a reasonable budget has been allocated for the projects and proposals involved in BBB v2.0.
It Will not Attract Bipartisan Support
The primary investments within the budget are pillars of the Democratic platform, such as college affordability, affordable housing, and healthcare. It draws funding from sources that Republicans tend to protest, such as higher taxes on corporations. It only does the bare minimum to appease the Republican side (e.g., an increase in budget for policing and national defense), but it does not precisely inspire bipartisan support.
It Implies the 2017 Tax Cuts Will Expire
In 2017, tax cuts were handed out to businesses and individuals to encourage investment and productivity. These tax cuts are set to expire in 2025, but the budget does not explicitly confirm that it will still happen. The expiration is implied, which could leave many feeling like the rug was pulled out from under them when they face higher taxes in 2025.
It Does not Reflect the Effects of the War in Ukraine
Granted, the budget was likely finalized a few weeks before war broke out, and it does take nearly a year to prepare. However, this does not change the fact that the plan fails to take into account the resources needed as a result of the war (e.g., supporting Ukrainian defense forces or a strengthened NATO, helping rebuild after the conflict)
It Does not Address Medicare and Social Security Running Out of Funding
Many Americans depend heavily on Medicare and Social Security to help cover the rising cost of living. Worryingly, forecasts say that the Medicare trust fund will run out by 2026, and the Social Security trust fund will run out by 2034. Biden’s budget fails to implement any plans designed to address this.
It is Unfair to Future Generations
Simply put, between the lack of planning for long-term support and the incorrect estimates for debt and deficits, the budget puts the strain of its failure on future generations. Without any significant changes, it could result in future generations being unprepared for the greater risk of inflation and financial instability.