Biden to raise taxes on wealthy, boost military and federal workers in the budget

President Joe Biden’s blueprint to destroy the budget includes a 5.2% increase for federal employees, one of the largest peacetime military budgets in recent history, and plans to bail out Social Security and Medicare.

What the plan doesn’t include: federal spending cuts — a demand from 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 make his budget dead on arrival when it reaches Capitol Hill, as Republicans, who control the House, prepare to hammer him as a Democrat on tax and spending.

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

The GOP has not yet released its budget proposal, but it is expected to cut foreign aid and reduce aid to the poor, including food, health care and housing.

Each side’s plan will serve as the launching pad for negotiations between Chairman Kevin McCarthy and Biden on fiscal 2024 spending, which begin Sept. 1.

It will take cooperation from both parties to pass a budget to keep the federal government going — McCarthy needs to keep his House Republicans in line, and Senate Majority Leader Chuck Schumer will need all of his Senate Democrats.

But the widely differing proposals create a policy clash that will play out against the backdrop of election year politics as Biden prepares for a second term and Republicans try to win back the Senate while retaining the House.

Details about the president’s budget, which he will formally unveil Thursday in Philadelphia, are beginning to trickle in.

• 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.
• He will push for one of the country’s largest peacetime defense budgets, per Bloomberg, with $170 billion for arms acquisitions and $145 billion for research and development. That gives the Department of Defense a topline number of $835 billion, up from $816 billion in the last fiscal year.
• Biden has already released his plan to make Medicare solvent through 2050 by increasing taxes for those earning more than $400,000 from 3.8 percent to 5 percent and improving Medicare’s ability to negotiate lower costs for prescription drugs , expand.
• He’ll probably mirror those Social Security tax increases to boost that program.
• The president also claims he can cut federal budget deficits by at least $2 trillion over the next decade New York Times reported, introducing a new household tax worth more than $100 million.

The deficit supply will be another point of contention as the country approaches its debt limit.

Biden has refused to negotiate with the Republicans about raising the debt ceiling and demanded a clean raise, as has been done for previous presidents — including Trump.

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

President Joe Biden (right) shakes hands with Speaker of the House 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 determines how much money the federal government can borrow, until Biden agrees to federal spending cuts.

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

Phillip Swagel, chief of the Congressional Budget Office, will brief lawmakers on the shortfall. He has warned that federal debt will surpass the size of the US economy within a decade if no steps are taken.

The GOP says they want at least $150 billion in cuts for fiscal year 2024, with a goal of eliminating budget deficits over a decade.

Adding to the tension is that the federal government is expected to hit its debt ceiling by the summer and that inaction could lead to a potentially catastrophic bankruptcy, Treasury Secretary Janet Yellen said.

Each side blames the other for the high federal deficit.

Republicans argue that post-pandemic spending under Biden contributed to the national debt, while Democrats say it was the tax cuts for businesses and wealthy individuals that were implemented under former President Donald Trump.

Meanwhile, Republicans are expected to release their budget by April 15, and it will likely include foreign aid cuts and major cuts to health care, food aid and housing programs for the poor amid their push to cut federal spending.

GOP leaders have said they will not push for Medicare or Social Security cuts.

To hit his budget and counter Biden, McCarthy faces the challenge of keeping his two wings of the GOP together — the legislators in the competitive House districts and the conservative hardliners — to get the 218 votes he needs. has.