President Joe Biden released a $5.8 trillion budget for the fiscal year 2023 on Monday, the first step toward establishing the funding for next year, which starts Oct. 1. That would normally have happened with the State of the Union address, which happens in late January or early February. Nothing is normal anymore, including the fact that Congress didn’t actually finalize this year’s government funding until a few weeks ago, more than five months into the fiscal year. Given the chance that Republicans could retake Congress in November, the funding President Biden is seeking in this budget won’t be approved by Oct. 1, either.
“Budgets are statements of values, and the budget I am releasing today sends a clear message that we value fiscal responsibility, safety and security at home and around the world, and the investments needed to continue our equitable growth and build a better America,” Biden said in a statement Monday, indicating that this was a budget written with Sen. Joe Manchin (D-WV) in mind. The second statement reinforces that. “My Administration is on track to reduce the federal deficit by more than $1.3 trillion this year, cutting in half the deficit from the last year of the previous Administration and delivering the largest one-year reduction in the deficit in U.S. history.”
Gone are the aspirations of making life better for everyone, but particularly marginalized communities, from Biden’s 2021 Build Back Better agenda. Now it’s about Manchin’s deficit cutting and “securing our nation” by “putting more police on the street to engage in accountable community policing, hiring the agents needed to help fight gun crime, and investing in crime prevention and community violence intervention.” That’s in paragraph three of Biden’s statement.
There’s a whopping $813.3 billion in national security spending in this budget, “one of the largest investments in our national security in history,” an increase of $31 billion from this year’s funding,” with the funds needed to ensure that “our military remains the best-prepared, best-trained, best-equipped military in the world,” Biden said. “In addition, I’m calling for continued investment to forcefully respond to Putin’s aggression against Ukraine with US support for Ukraine’s economic, humanitarian, and security needs.” The funding includes $773 billion for the Pentagon, up about 10% from the 2021 levels.
One good part of the proposal is a new “Billionaire’s Minimum Tax,” a 20% income tax rate for the top 0.01% earners and households worth more than $100 million. “In 2021 alone, America’s more than 700 billionaires saw their wealth increase by $1 trillion, yet in a typical year, billionaires like these would pay just 8 percent of their total realized and unrealized income in taxes,” the White House said in releasing the proposal. “A firefighter or teacher can pay double that tax rate.”
This proposal is calling on Congress to pass new tax legislation “requiring the wealthiest American households to pay a minimum of 20 percent on all of their income, including unrealized investment income that currently is untaxed.” In addition, it calls for a hike in the corporate tax rate from 21% up to 28%. The two Democratic problem senators, Manchin and Arizona’s Kyrsten Sinema, rejected that increase in previous negotiations. Manchin was willing to go as high as 25% on the corporate rate; Sinema is flat-out opposed to an increase.
The billionaire tax was well-received by Sen. Ron Wyden, chair of the Senate Finance Committee, who has his own “Billionaires Income Tax” legislation. “There’s no way to fix our broken tax code without getting at the problem of billionaires avoiding taxes for decades, if not indefinitely,” Wyden said. “While there are differences between the president’s proposal and the Billionaires Income Tax, we’re rowing in the same direction.”
The top lines being pushed by the White House, though, seem to be aimed at fighting the inevitable “soft on crime” label from Republicans, running from any idea of defunding the police by throwing more money at them, as well as national security.
The White House is more or less assuming the COVID-19 pandemic is over, shifting the subject to “future pandemics and other health emergencies … We must increase and sustain our investments across the U.S. Government to better prevent, detect, and respond to pandemics, and to build a world safe and secure from biological threats,” the White House said in a statement on “pandemic preparedness and biodefense.”
That includes a “a historic $88.2 billion request for mandatory funding, available over five years” that would be spent across the Department of Health and Human Services, the Office of the Assistant Secretary for Preparedness and Response (ASPR) the Centers for Disease Control and Prevention (CDC), the National Institutes of Health (NIH), the Food and Drug Administration (FDA), the Department of State, and the U.S. Agency for International Development (USAID). That’s intended to “fund transformative improvements in our capabilities to prevent, detect, and respond to emerging biological catastrophes.”
Biden’s budget leaves out funding levels for many of the programs included in what used to be known as Build Back Better and is still under some sort of negotiation with some other name among congressional Democrats. The climate, taxes, and social investment programs aren’t spelled out with funding numbers, but are basically endorsed.