The nation’s debt could grow by nearly $10 trillion over the next two decades if President Joe Biden’s $6.9 trillion proposed budget is approved.
The fiscal 2024 proposal would lead to a national debt of almost $51 trillion over the next decade, a massive jump from the already-record $31.5 trillion debt level.
“The budget request includes $4.7 trillion in new or increased taxes over the next decade,” according to Sen. Mike Crapo (R-ID), Ranking Member of the Senate Finance Committee.
“The President’s budget calls for hiking the individual federal income tax rate up to 39.6 percent from 37 percent, not including surtaxes. In addition to raising the rate, the proposal also lowers tax brackets by hundreds of thousands of dollars, thereby pushing tax increases on even more hardworking Americans,” he added.
In addition to personal tax increases, the nation’s businesses would face new costs.
Per Sen. Krapo’s statement: “According to the nonpartisan Joint Committee on Taxation, the effects of hiking this tax would primarily be borne by those making less than $500,000 per year. A separate study shows consumers shoulder more than 30 percent of any comparable tax increase.
Krapo also claaims, “when combined with state and local taxes, many companies would face an income tax rate far higher than China’s (25%) and Europe’s (average 21.7%). “
The budget proposal also includes expanded spending for a variety of programs. More than $1 trillion focuses on programs such as Medicaid, child care, pre-kindergarten, public housing and free community college.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, also expressed her concerns over the jump in increased costs.
“The President’s budget would borrow $19 trillion through 2033 and increase the debt-to-GDP ratio from 98 percent at the end of 2023 to 110 percent by 2033, past the record set in this nation just after WWII,” MacGuineas wrote. “It would spend $10.2 trillion on interest payments on the national debt alone – more than it will spend on defense or Medicaid over the same time period.”
MacGuineas did praise Biden for suggesting measures that would create a $3 trillion reduction but noted that they would only provide a “fraction” of the need to fix the debt.
“While the $3 trillion of savings proposed in the budget would only go a fraction of the way toward fixing the debt, it is directionally correct and an achievable target for upcoming budget negotiations,” she observed.
