Heritage Foundation experts weigh in on the $1.75 trillion spending package. Christian Mysliwiec writes:
The White House released on Thursday a framework for the Build Back Better agenda—a massive, $1.75 trillion spending bill that will radically transform the American way of life as we know it—and Democrats in Congress are intent on rapidly moving it immediately. We asked analysts from The Heritage Foundation to examine what is in the bill text. Here are their responses:
Budget Gimmicks
The White House’s newly released framework returns to a tried-and-true way to obscure the true cost of the legislation: budget gimmicks. The current reconciliation instructions place caps on the 10-year deficit impact of provisions that could be included in the bill.
However, the new framework provides partial funding for many programs—creating temporary benefits that are clearly intended to be made permanent. This means that the cost estimates in this framework are only the tip of the iceberg of what the White House has planned.
For example, both the child care and pre-K provisions are reported as being given “funding for six years” despite both being listed also as “a long-term program.” The Obamacare tax credit extension would last only through 2025. The expanded Child and Earned Income tax credits would each be extended for only one year.
Keep in mind that the annual cost for each of these programs would, likely, be higher in the 10th year of the budgetary window than in the first year. As such:
Childcare and Pre-K: Actual 10-year cost is likely more than twice the reported cost of $400 billion
Obamacare Tax Credit: Actual 10-year cost is likely much more than three times the reported cost of $130 billion.
Child and Earned Income Tax Credits: Actual 10-year cost is likely more than 10times the reported cost of $200 billion.
In total, these programs would likely cost well over $2.3 trillion above the estimate in this framework over 10 years. This excess would be more than $18,700 of new spending per American household.
These gimmicks will set up future congresses with intentionally tough votes whether to extend new entitlement benefits. This process is clearly intended to circumvent the fiscally responsible controls in the reconciliation process. Using these gimmicks, the bill could be used to sneak in much larger debt-busting spending.
The issue here is not simply the spending—it is where that money comes from and where it goes.
By front-loading the spending and spreading tax hikes across 10 years, the framework would increase already-high inflationary pressures. Even worse, the taxes would suppress business investment at a time when the economic recovery is in danger of stalling out.
The drafters of this framework use the term “investment” to cover their planned corporate cronyism and wealth redistribution. This bill would make no investment—it would only misdirect the wealth generated by all Americans through their hard work.
Make no mistake, this plan is ultimately a framework for how much Biden wants to take out of your wallet to fund his ideological interests.
– Richard Stern is a senior policy analyst focusing on budget policy at The Heritage Foundation and David Ditch is a policy analyst at Heritage’s Grover M. Hermann Center for the Federal Budget
[Christian Mysliwiec, "What’s in Democrats’ $1.75 Trillion Spending Bill,” The Daily Signal, October 28]
