pcloudy.png
Wednesday June 16th, 2021 4:49PM

Biden budget highlights: Lots of spending, taxing the rich

By The Associated Press
Related Articles
  Contact Editor

WASHINGTON (AP) — President Joe Biden's $6 trillion budget proposal offers major new initiatives like child and elder care subsidies, generous tax credits for families and the working poor, and free community college. It also promises politically freighted tax increases on the wealthy and corporations and would give domestic Cabinet departments significantly bigger budget increases than the Pentagon.

But like all presidential budget plans, Biden's proposal needs the approval of lawmakers, who can change the allotments and dollar figures.

Here are some other things to keep in mind about Biden's budget:

LOTS OF SPENDING

This year's $6 trillion spending total — fueled by ongoing COVID-19 relief efforts — is actually down from a projection of $7.2 trillion for the budget year ending in September. But it's sharply higher than the pre-pandemic $4.4 trillion tally of 2019 and fueled by promises of government help for crushing child care, college, health care and elder care costs. But the nation's huge defense budget would get minimal increases, angering Republicans whose votes Biden needs.

___

TAXING BUSINESS AND THE RICH

Biden promises $2 trillion in corporate tax hikes, including an increase from 21% to 28% in the corporate rate and restoring the top individual tax bracket from 37% to 39.6%. Capital gains taxes would increase for wealthier investors, and inherited capital gains would no longer be tax-free. It would extend Democrats' generous increase in the per-child tax credit from $2,000 to $3,600 for children up to 6 years old and $3,000 for older children. It would also crack down on unpaid taxes by boosting reporting and enforcement.

___

BARRELS OF RED INK

Several rounds of pandemic relief swelled last year's deficit to $3.1 trillion, and the U.S. is on track for a $3.7 trillion deficit this year, which means a total national debt exceeding $30 trillion within a few months. While deficits would be cut roughly in half, to $1.8 trillion, in the budget year starting in October, they would remain well above levels that mainstream economists have believed to be sustainable. Annual interest payments on all of that Treasury borrowing would almost double in the next five years from about $300 billion now to $581 billion in 2027.

___

IFFY PROSPECTS IN CONGRESS

Democrats control Congress by the narrowest of margins and could theoretically pass Biden's tax increases and many of his bold spending plans under special budget rules that prevent a GOP Senate filibuster. But it only takes a single Democratic defection to mess things up, and there's ample resistance to Biden's full corporate tax increase and higher taxes on capital gains. Smaller tax increases would mean Democrats would have to scale back their ambitions on spending. And Senate Republicans are sure to bring Biden's high-flying hopes for annual nondefense appropriations back to Earth by insisting on spending increases for the Pentagon that are comparable to domestic agencies.

___

CAUTIOUS ECONOMIC PROJECTIONS

Some of Biden's predecessors, including former President Donald Trump, were guilty of juicing economic projections to make their budget numbers work. But the Biden team appears more cautious, projecting long-term economic growth of about 2% after a 5.2% boost this year and a 3.2% increase in 2022. Consumer prices, which are currently spiking, are seen as remaining in check, at about 2% inflation each year.

  • Associated Categories: Associated Press (AP), AP Online Headlines - Washington, AP Online Congress News, AP Business, AP Business - Corporate News, AP Business - Economy, AP Business - Personal Finance
© Copyright 2021 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
3 officers plead not guilty in Black man's restraint death
Three Washington state police officers have pleaded not guilty to charges in the restraint death of a Black man who repeatedly told them he couldn't breathe
5:14PM ( 4 minutes ago )
FDA OKs 1st targeted drug for common lung cancer mutation
U.S. regulators have approved the first medicine for patients with the most common type of lung cancer whose tumors have a genetic mutation long considered untreatable with drugs
5:00PM ( 17 minutes ago )
Eyeing calendar, Biden to end GOP infrastructure talks soon
President Joe Biden wants to wrap up infrastructure negotiations soon with Senate Republicans
4:57PM ( 21 minutes ago )
Associated Press (AP)
Senate confirms geneticist Lander as Biden science adviser
The Senate has confirmed geneticist Eric Lander to be President Joe Biden’s chief science adviser
4:15PM ( 1 hour ago )
Lawyers: Biden in office makes 2020 protest suit unnecessary
Lawyers say lawsuits filed by protesters who were forcefully removed from a park near the White House before a photo op by former President Donald Trump should be dismissed because the new administration is not likely to repeat the events of last June
3:52PM ( 1 hour ago )
EXPLAINER: What's the Senate filibuster and why change it?
Minority Republicans have used a Senate filibuster to derail Democrats’ effort to launch a bipartisan probe of the Jan. 6 attack on the Capitol
3:31PM ( 1 hour ago )
AP Online Headlines - Washington
Senate R&D bill to counter China shelved by GOP opposition
The Senate shelved a big innovation bill aimed at making the U.S. more competitive with China and other countries
11:52AM ( 5 hours ago )
Social spending, business tax hike drive $6T Biden budget
President Joe Biden is proposing a $6 trillion budget for next year that fails to slow spiking government debt
11:40AM ( 5 hours ago )
Senate vote on Jan. 6 panel expected amid GOP opposition
The Senate has pushed action into Friday on a bill to create an independent commission to study the deadly Jan. 6 attack on the Capitol by Donald Trump’s supporters
10:05AM ( 7 hours ago )
AP Online Congress News
US agency loosens mask guidance for summer campers
Kids at summer camps can skip wearing masks outdoors, with some exceptions
4:24PM ( 54 minutes ago )
The Latest: CDC loosens mask guidance for summer campers
Kids at summer camps can skip wearing masks outdoors, with some exceptions
4:11PM ( 1 hour ago )
Travel numbers climb as Americans hit the road for holiday
It's going to be crowded at airports and on the road this Memorial Day weekend
4:09PM ( 1 hour ago )
AP Business
Female CEOs saw ranks dwindle in 2020; median pay fell 2%
Most of the women running the biggest U.S. companies saw their pay increase last year, even as the pandemic hammered the economy and many of their businesses
9:00AM ( 8 hours ago )
CEO pay rises to $12.7M even as pandemic ravages economy
The pandemic crushed the economy, but it was no match for CEO pay, which rose again last year
8:52AM ( 8 hours ago )
Many women CEOs saw raises last year, but ranks remain thin
Most of the women running the biggest U.S. companies saw their pay increase last year, even as the pandemic hammered the economy and many of their businesses
8:23AM ( 8 hours ago )
AP Business - Corporate News
US consumers boosted spending in April as inflation surged
Americans increased their spending by 0.5% in April, a slowdown after a massive gain in March which had been powered by distribution of billions of dollars in individual stimulus checks
12:28PM ( 4 hours ago )
Belarus' leader seeks Russia's support amid showdown with EU
Belarus’ authoritarian leader is discussing closer economic ties with Russia, as he seeks support from his main backer amid a bruising showdown with the European Union over the forced diversion of a passenger jet to arrest a dissident journalist
11:22AM ( 5 hours ago )
Malaysia imposes near-total lockdown after virus cases soar
Malaysia’s prime minister says a near-total coronavirus lockdown will be imposed in the country, with social and economic activities to be halted for two weeks to contain a worsening outbreak
10:27AM ( 6 hours ago )
AP Business - Economy
The Latest: W Virginia steps up prizes for vaccination
West Virginia will step up its prizes for vaccines, enrolling all residents who have received a coronavirus shot into a lottery for the chance to win a college scholarship, an F-150 pickup truck or cash rewards
7:25PM ( 21 hours ago )
The Latest: Louisiana offers drinks to people who get shots
A statewide “Shot for a Shot” campaign offering free drinks for people who get vaccinated against COVID-19 will begin in June
6:01PM ( 23 hours ago )
The Latest: Idaho's lieutenant gov. bans masks in schools
Idaho’s lieutenant governor issued an executive order Thursday banning masks in schools and public buildings
4:33PM ( 1 day ago )
AP Business - Personal Finance
3 officers plead not guilty in Black man's restraint death
Three Washington state police officers have pleaded not guilty to charges in the restraint death of a Black man who repeatedly told them he couldn't breathe
5:14PM ( 4 minutes ago )
FDA OKs 1st targeted drug for common lung cancer mutation
U.S. regulators have approved the first medicine for patients with the most common type of lung cancer whose tumors have a genetic mutation long considered untreatable with drugs
5:00PM ( 17 minutes ago )
Eyeing calendar, Biden to end GOP infrastructure talks soon
President Joe Biden wants to wrap up infrastructure negotiations soon with Senate Republicans
4:57PM ( 21 minutes ago )
Farm laborer convicted in 2018 stabbing death of Iowa runner
A jury has found a farm laborer guilty of murder in the abduction and killing of a University of Iowa student who vanished while out for a run in 2018
4:50PM ( 27 minutes ago )
Cavs still view Kevin Love as valuable piece in slow rebuild
The Cavaliers intend to keep Kevin Love around
4:45PM ( 33 minutes ago )