Democrats have provided few details of what they plan to include in
Sen. Bernie Sanders’s
$3.5 trillion budget proposal, and now we know why. The real cost is $5 trillion or more, according to an independent analysis by the Committee for a Responsible Federal Budget, which keeps an eye on fiscal matters.
The budget-resolution fact sheet Democrats circulated last week includes only a bare-bones description of the bill’s major programs for tax credits, new entitlements, healthcare, climate and housing. Some categories include this revealing caveat: “The duration of each program’s enactment will be determined based on scoring and Committee input.”
That’s Washington-speak for admitting the budget will be built on phony assumptions and gimmicks. Democrats know their proposed tax hikes and dubious “pay-fors” won’t come close to fully funding “every major program that President Biden has asked us for”—as Senate Majority Leader Chuck Schumer claimed.
Their plan is to include every program but start small and pretend they’re temporary. This will let them skirt the budget-reconciliation rule that spending can’t add to the deficit outside a 10-year budget window without triggering a 60-vote threshold to pass.
The nonprofit Committee for a Responsible Federal Budget examined the budget outline and on Monday released a more honest analysis of the bill’s cost. Its estimate is based on
fiscal 2022 budget proposal and legislation that Democrats have already proposed that will fill in the budget blanks later this year. Assuming the major provisions will be made permanent and continue through the 10-year budget window, the group says, the “policies under consideration could cost between $5 trillion and $5.5 trillion over a decade.”
One example: In their March Covid bill, Democrats increased the child tax credit for one year—to $3,600 for children under age 6 and $3,000 for ages 6-17. Democrats now want to extend it further, and Mr. Biden’s budget claims it would run through 2025—at a cost of $436 billion. But Democrats are already broadcasting their plan to make it permanent in 2025, which the independent budget committee estimates would cost $1.1 trillion over 10 years. That’s about 2% of U.S. GDP.
Democrats are giving themselves similar “sunset” options for their expansion of the earned-income tax credit, the dependent care tax credit, their major new health and home-care programs, and new entitlements for child care, college and paid family leave.
The nonprofit committee also estimates the cost of provisions that aren’t in Mr. Biden’s budget but that Democrats say they’ll add to the reconciliation bill. That includes $370 billion in new spending for dental, hearing and vision benefits in Medicare, and $300 billion to close the Medicaid “coverage gap” in some states. Add a few cats and dogs such as an increase in the size of the state-and-local tax deduction, and, voila, $5.5 trillion.
All of this false accounting will let Democrats pretend the overall cost of their budget spending is lower than it really is, making it easier for House Democrats in swing districts and Senators in swing states to support. It will also reduce the size of the tax increases needed to pretend to pay for all of these new programs. Any way you add it up, Democrats are attempting to pass the biggest expansion of government since the 1960s with narrow majorities and no electoral mandate. No wonder they want to disguise its real cost.
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Appeared in the July 21, 2021, print edition as ‘Bernie’s Real Budget: $5 Trillion.’