Biden to raise taxes on the rich, boost military and federal workers in budget – NewsFinale

By Emily Goodin, Senior US Political Reporter for

President Joe Biden’s budget destruction bill will include a 5.2% raise for federal employees, one of the largest peacetime military budgets in recent history, and plans to save Social Security and Medicare.

What the plan doesn’t include: Federal spending cuts: A demand by Republicans to reduce the $31.4 trillion federal deficit.

Instead, Biden will pay for his proposals with a series of new taxes on the wealthy and corporations.

The combination of more spending and taxes will likely see his budget run out by the time he gets to Capitol Hill as Republicans, who control the House, prepare to pummel him like a tax-and-spending Democrat.

President Biden will unveil his budget on Thursday in Philadelphia, vowing not to cut Medicare or Social Security.

A snapshot of what’s in Biden’s budget plan, ahead of the formal announcement on Thursday

The Republican Party has yet to publish its budget proposal, but it is expected to cut foreign aid and assistance to the poor, including food, health care and housing.

Each party’s plan will serve as the kickoff for negotiations between President Kevin McCarthy and Biden on spending for the 2024 fiscal year, which begins Sept. 1.

Bipartisan cooperation will be needed to pass a budget that keeps the federal government running: McCarthy has to keep his Republicans in line in the House, and Senate Majority Leader Chuck Schumer will need all his Democrats in the Senate.

But the vastly different proposals set up a policy clash that will play out in the midst of election-year politics, as Biden prepares to seek a second term in office and Republicans try to win back the Senate while retaining the House.

Details about the president’s budget, which he will formally unveil in Philadelphia on Thursday, have begun to leak.

  • He will propose a 5.2% raise for federal workers, the largest White House raise since Jimmy Carter was president, according to the Washington Post. But it falls short of the 8.7% increase that lawmakers, including many Democrats, want.
  • It will boost one of the nation’s largest peacetime defense budgets, according to Bloomberg, with $170 billion for weapons procurement and $145 billion for research and development. That will give the Department of Defense a maximum figure of $835 billion, up from $816 billion in the last fiscal year.
  • Biden has already launched his plan to make Medicare solvent through 2050 by raising taxes on those who earn more than $400,000 from 3.8% to 5% and expanding Medicare’s ability to negotiate lower costs for prescription drugs.
  • It will likely reflect those Social Security tax increases to boost that program.
  • The president also claims he can reduce federal budget deficits by at least $2 trillion over the next ten years, the New York Times reported, by initiating a new tax on homes worth more than $100 million.

The deficit provision will be another sticking point as the country approaches its debt limit.

Biden has refused to negotiate with Republicans on raising the debt ceiling, demanding a clean raise, as has been done with previous presidents, including Trump.

House Republicans, led by Speaker Kevin McCarthy (above), have yet to release their proposed budget, but it is expected to contain cuts in foreign aid and assistance to the poor.

President Joe Biden (right) shakes hands with House Speaker Kevin McCarthy (left) before Biden’s State of the Union address; now comes the hard part: finding a compromise

But House Republicans have refused to raise the debt limit, which limits the amount of money the federal government can borrow, until Biden agrees to cut federal spending.

Republicans will focus on the $31.4 trillion debt in a closed-door meeting on Capitol Hill on Wednesday, the day before Biden unveils his final budget proposal.

The head of the Congressional Budget Office, Phillip Swagel, will brief lawmakers on the deficit. He has warned that the federal debt will exceed the size of the US economy in the next decade if no action is taken.

The GOP says it wants at least $150 billion in cuts by fiscal year 2024, with the goal of eliminating budget deficits over ten years.

Adding to the stress, the federal government is expected to hit its debt ceiling by the summer and failure to act could trigger a potentially disastrous default, according to Treasury Secretary Janet Yellen.

Each side blames the other for the high federal deficit.

Republicans say post-pandemic spending under Biden added to the national debt, while Democrats say it was former President Donald Trump’s tax cuts for businesses and wealthy individuals that caused it.

Meanwhile, Republicans are expected to release their budget by April 15, and it is likely to contain cuts to foreign aid and deep cuts to health care, food assistance and housing programs for the poor in the midst of their campaign to cut federal spending.

Republican leaders have said they will not seek cuts to Medicare or Social Security.

To pass his budget and counter Biden, McCarthy faces the challenge of keeping his two wings of the GOP — lawmakers in competitive House districts and hardline conservatives — together to get the 218 votes he needs.

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