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As debt climbs to $31T, Dems eye new version of Biden spending bill with Manchin's support
West Virginia Sen. Joe Manchin signaled that he could support a new, more targeted version of Biden's sweeping Build Back Better Act that meets certain criteria.
justthenews.com
The Democrat-led Congress might still be able to garner enough votes to pass President Biden's massive spending package, despite already raising federal spending by more than 6% and presiding over record deficit and debt levels.
The national debt is climbing to a staggering $31 trillion for the first time in U.S. history. The federal deficit hit record numbers in FY2020 ($3.1 trillion) and FY2021 ($2.8 trillion), driven by large coronavirus stimulus measures. The deficit in the first 5 months of this year is $475 billion.
According to a recent analysis by the Committee for a Responsible Federal Budget, the fiscal year (FY) 2022 omnibus appropriations bill that Congress recently passed "provides $1.512 trillion of budget authority for FY2022, $88 billion (6 percent) higher than FY 2021 levels, $50 billion higher than in the Congressional Budget Office's (CBO) most recent baseline, and in line with FY 2021 levels when adjusted for higher inflation."
The CRFB analysis shows that the spending bill "includes $782 billion for defense and $730 billion for non-defense programs" and raises FY 2021 spending levels by "more than 6 percent on average."
Marc Goldwein, senior vice president and senior policy director at CFRB, told Just The News that the omnibus bill should have been smaller due to the rising inflation that consumers are experiencing.
"If every time we have 7% inflation we then increase spending by 7%, that spending is then going to go into higher inflation, because when the economy is this oversaturated with demand, new deficit-financed government spending is mostly going to increase inflation, it's not mostly going to increase output," he said. "So the omnibus would have been better if it were smaller, it's a problem that will perpetuate this, but it didn't really cause new problems, per se."
Maya MacGuineas, president of the spending watchdog group, said the spending bill increased spending by "roughly $500 billion above CBO's most recent baseline over the next decade." She argued that the "increase would allow spending to roughly keep pace with inflation, but in doing so, the bill will actually exacerbate inflationary pressures."
She called on Congress to "restore reasonable and responsible discretionary spending caps to ensure future spending levels remain under control."
In December, West Virginia Democratic Sen. Joe Manchin said he opposed Biden's nearly $2 trillion Build Back Better Act, citing record inflation and other concerns. Inflation has reached a 40-year high.
With the 2022 midterm elections drawing closer, Manchin signaled this week that he could support a new, more targeted version of Biden's sweeping spending bill.
Manchin, chairman of the Senate Natural Resources Committee, reportedly told a group of climate activists he would like a new package to focus on prescription drugs, climate change and reducing the deficit. His support for a revised spending package has revived Democratic leaders' hopes of passing the Build Back Better legislation.
Progressive Democrats, however, previously opposed a skinnier version of the roughly $2 trillion package, which sets the stage for an internal party fight over a further-reduced version of the bill.
Goldwein told Just the News that the House Democrats' earlier version off the $2 trillion bill "would have exacerbated inflationary pressures" if it was signed into law. Goldwein said the idea of a new deficit reducing package has the potential to be "disinflationary." |
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