President Biden will propose a $ 6 trillion budget on Friday that would take the United States to its highest sustainable levels of federal spending since World War II, as the deficit exceeds $ 1.3 trillion over the next decade. Total spending is expected to rise to $ 8.2 trillion by 2031.
Biden’s plan to fund his agenda by raising corporate and high-income taxes will begin to reduce the budget deficit in the third decade of this century. Administration officials said the job and household plans will be fully offset by tax increases over 15 years, which are supported by the budget request.
Meanwhile, the United States will run a large deficit as it is borrowing money to fund its plans. Under Biden’s proposal, the federal budget deficit would reach $ 1.8 trillion in 2022, even as the economy recovers from the pandemic recession, growing in what the administration expects will be its fastest annual pace since the early 1980s, and then receding slightly in the following years before growing again to nearly $ 1.6 trillion by 2031.
The total debt held by the public will exceed more than the annual value of economic output, rising to 117% of the economy in 2031. By 2024, debt as a share of the economy will rise to the highest level in American history, surpassing the record of the Second World War era.
The budget is simply a request to Congress, which must approve federal spending. But with Democrats controlling both houses of Congress, Biden faces some of the best prospects for any president in recent history to agree to a large part of his agenda, especially if he can reach agreement with lawmakers on parts of his infrastructure agenda.