President Joe Biden’s fiscal year 2022 budget, released on Friday, lays out an ambitious plan for the country. It calls for just over $6 trillion in total spending in the coming fiscal year and reimagines how — and for whom — the American economy works.
As proposed, the budget would reinvest in infrastructure and education, raise taxes on the wealthy and corporations, and meet many — but not all — of Biden’s campaign promises. It also represents the most substantial expansion of the federal government’s spending powers since World War II and a direct rebuttal of the small-government principles of his Republican, and even many Democratic, predecessors.
The budget is also notable for what it does not include: a renewal of the Hyde Amendment, which bars federal funding for abortions. That rule, in place for more than four decades, has been criticized for contributing to economic and racial inequality — and its absence is one of several ways that this budget aims to affirmatively target root causes of inequality.
“It is a budget that reflects the fact that trickle-down economics has never worked, and that the best way to grow our economy is not from the top down, but from the bottom up and the middle out,” Biden wrote in his budget message to Congress. “If we make that understanding our foundation, everything we build upon it will be strong.”
Today, I released my budget for the upcoming fiscal year. It builds on the progress we’ve made over the last few months and makes historic investments that will help our nation build back better for decades to come. Read more here: https://t.co/6dKv8wa4yI
— President Biden (@POTUS) May 28, 2021
When the Biden administration unveiled a partial budget request framing its discretionary spending proposals in early April, Vox’s German Lopez wrote that the plan was “grounded in a clear vision: The government can — and should — do much more to solve the many problems facing the country.”
Biden’s full budget continues to reflect that philosophy while fleshing out Biden’s broader presidential agenda, including legislative proposals like the American Jobs and American Families plans.
However, nothing in Biden’s budget is binding, nor is the ambitious plan likely to be enacted in full. The president’s budget is a regular feature of the broader budget process, but it’s by no means the final word. That’s up to Congress, which will eventually pass its own budget resolution and a series of appropriations bills to actually fund the government into the next fiscal year.
As Vox’s Dylan Matthews explained during the Trump years, the president’s budget is instead best viewed as a messaging document: a sketch of the administration’s spending priorities and a way to set the tone for Congress as lawmakers hash out the particulars of the budget. It’s also a statement about which of Biden’s campaign promises he wants to focus on — and which are no longer a priority of his White House.
Democrats are mostly happy with Biden’s budget. Republicans are not.
Biden’s budget has been greeted gladly by Democrats in Congress. House Speaker Nancy Pelosi (D-CA) heralded it as “an unequivocal declaration of the value that Democrats place on America’s workers and middle class families” in a statement Friday, and the House Progressive Caucus highlighted Biden’s “strong commitment to making our tax system fair for working people.”
A federal budget should be a statement of our national values. @POTUS Biden’s budget is an unequivocal declaration of the value that Democrats place on America’s workers and middle class families, who are the foundation of our nation’s strength and the key to #BuildBackBetter.
— Nancy Pelosi (@SpeakerPelosi) May 28, 2021
The GOP, meanwhile, struck a more apocalyptic note in response to the Biden budget. House Minority Leader Kevin McCarthy (R-CA) described the plan as “the most reckless and irresponsible budget proposal in my lifetime” and warned of “dire fiscal and economic consequences” in a Friday statement, while Sen. Lindsey Graham (R-SC) dismissed it in a tweet as “dead on arrival.”
And both parties pushed back on one aspect of the budget: military spending. Progressives argued in a statement that the budget spends too much on national defense, further expanding an “already-bloated $740 billion Pentagon budget.”
“At a time when America’s military budget is larger than those of the next ten countries combined,” the Congressional Progressive Caucus wrote, “we believe it is essential to identify and cut military waste, fraud, and abuse in the budgetary process.”
Republicans argued the opposite, saying the proposed budget underspends on military operations and defense. While the Pentagon’s budget would increase by 1.6 percent under Biden’s proposal — representing a record military expenditure — it’s still the smallest increase of any federal agency.
House and Senate Republicans released a statement arguing that the proposed military budget “is wholly inadequate” and represents a spending cut in the face of inflation.
“A budget like this sends China and our other potential adversaries a bad signal — that we’re not willing to do what it takes to defend ourselves and our allies and partners,” the statement reads.
The era of big government is back
As Lopez and many others have pointed out, the first months of Biden’s presidency can be seen as a repudiation of former President Bill Clinton’s famous line that “the era of big government is over.”
Biden’s fiscal year 2022 budget fits squarely into that pattern. It includes two substantial, signature proposals: a $2 trillion American Jobs Plan — which would embrace an expansive definition of infrastructure, not only to modernize America’s road and bridges, but to invest in broadband and elder care — and a $1.8 trillion American Families Plan, which would establish free higher education and expand child care, health care, and tax benefits for needy families.
As a whole, the budget calls for a sweeping rejuvenation of the social safety net and for expanded investment in programs like universal pre-K, affordable child care, and paid leave. It also puts the climate crisis front and center, with proposals dedicated to reducing US emissions, creating jobs in the clean energy sector, and funding climate research.
And it reinvests in aspects of daily life, from public transit to the arts, that were slashed under the Trump administration. The idea, as Biden outlined it in his budget message Friday, is “not simply to emerge from the immediate crises we inherited, but to build back better.”
Among other details, the Biden budget specifically requests funding for two free years of community college; expanded Pell Grants and other programs to make college more affordable for low- and middle-income students; an extension to the expanded child tax credit included in the already-passed American Rescue Plan, which experts have said could cut child poverty in half; and universal paid family and medical leave programs “that would bring the American system in line with competitor nations that offer paid leave programs.”
And if enacted, Biden’s budget would invest tens of billions in advancing racial equity and addressing systemic racism in the US, according to a tally of equity-focused budget items “big and small” by the New York Times.
Additionally, according to Roll Call, 17 out of 22 sections in the proposal “explicitly mention new or expanded programs focused on racial disparities, inequality or civil rights. By comparison, President Donald Trump’s 150-page fiscal year 2020 budget request did not once mention the words ‘race,’ ‘racial’ or ‘civil rights.’”
In particular, Biden’s budget calls for increased funding for historically Black, tribal, and minority-serving colleges and universities; investment in environmental justice initiatives; and programs designed to reduce racial disparities in health care.
On the campaign trail, Biden made his racial equity plan one of the pillars of what he called the “Build Back Better Agenda” — branding that he has carried through into the White House — and he pledged to boost minority-owned businesses, address racial disparities in home ownership, and end pay discrimination, among other issues.
Philosophically, Biden’s first budget as president is also a marked departure from the last time he was in the White House, then in the No. 2 job. As Lopez wrote in April, Biden avoids the occasional concessions to austerity politics that cropped up under former President Barack Obama and offers “a largely tacit and sometimes explicit criticism of the past few decades of public disinvestment in public services — arguing that failures to put more money toward pandemic preparedness, clean energy technologies, and programs to help the poor and disadvantaged have helped lead the US to its current crises.”
Some progressive economic experts, like Bob Greenstein, the founder of the Center on Budget and Policy Priorities and a current visiting fellow at the Brookings Institution, have praised the document for its potential to redress causes of inequality and financial hardship.
“Having followed Presidents’ budgets for >40 years, I think it’s fair to say that while I might modify some things in the new Biden budget, it would, if enacted, do more to reduce poverty and inequality than any other budget in modern US history,” he said in a Friday tweet.
Having followed Presidents’ budgets for >40 years, I think it’s fair to say that while I might modify some things in the new Biden budget, it would, if enacted, do more to reduce poverty and inequality than any other budget in modern US history
— Bob Greenstein (@BobGreensteinDC) May 28, 2021
On health care and student debt forgiveness, Biden holds back
As sweeping as Biden’s budget is, however, there are also some conspicuous absences compared to his campaign platform. Specifically, proposals on health care don’t go as far as some advocates would like — and student debt forgiveness doesn’t make an appearance at all.
As a candidate, Biden distinguished himself from more progressive presidential hopefuls like Sens. Elizabeth Warren (D-MA) and Bernie Sanders (I-VT), both of whom endorsed Medicare for All, by promising to keep the existing American health care system mostly intact — but he also pledged to build on the existing Affordable Care Act and expand health care access in the US.
The centerpiece of that plan was to be a public option: As Vox’s Dylan Scott has explained, a “Medicare-like government insurance plan would be sold on Obamacare’s marketplaces, where roughly 12 million Americans buy their own insurance. It would add more competition to areas where only one or two other insurance plans are available. The public option would also cover low-income Americans who are currently denied insurance because of their state’s opposition to Obamacare.”
Biden’s fiscal year 2022 budget doesn’t abandon that plan. In fact, it emphasizes that health care “is a right, not a privilege” and says specifically that he “supports providing Americans with additional, lower-cost coverage choices by creating a public option that would be available through the ACA marketplaces.”
However, the budget also doesn’t do anything concrete to advance a public option, and funding for one isn’t included in the $6 trillion in overall spending requested in the budget.
According to the Washington Post’s Jeff Stein and Tyler Pager, the public option was a casualty of last-minute caution by the administration. They reported last week that “the White House jettisoned months of planning from agency staff as their initial plan could fuel criticisms that the administration is pushing new spending programs too aggressively.”
The same appears to be true of student debt forgiveness, according to the Post. Just as he did with a public health insurance option, Biden promised on the campaign trail and as president-elect to “immediately” forgive up to $10,000 in student debt for all borrowers. But that promise gets short shrift in the budget, with only one brief mention in regard to “changes … that ease the burden of student debt,” and, again, no funding dedicated to that project.
Still, while student debt forgiveness didn’t make it into Biden’s budget, it isn’t off the table. Congressional Democrats could push to include it in a congressional budget resolution, if they choose, and Biden directed Education Secretary Miguel Cardona earlier this year to create a memo outlining Biden’s options for forgiving up to $50,000 in student debt. That’s the amount that Senate Majority Leader Chuck Schumer (D-NY) and others have supported.
More than 43 million Americans are crushed under more than $1.5 trillion in federal student loan debt.
A crisis of this magnitude requires bold action.
President Joe Biden can #CancelStudentDebt through executive action https://t.co/WR2gNo37Cd
— Chuck Schumer (@SenSchumer) March 9, 2021
Biden’s budget proposal could hinge on Joe Manchin
As the Post reported, one reason a public health care option and student debt forgiveness didn’t get more space in Biden’s fiscal year 2022 budget is that the administration already has an ambitious slate of legislative priorities before Congress. With negotiations still in flux, the dollar amounts laid out in the budget could change dramatically — and the final decisions over that spending will likely be subject to the same partisan back-and-forth as any other spending package that reaches Congress.
In short, if the White House wants to pass spending bills through regular order — without resorting to the budget reconciliation process — Democrats will always need at least 10 Republican votes to clear the filibuster.
Biden has already fought for, and won, one costly package: the $1.9 trillion American Rescue Plan, known as his Covid-19 stimulus package. In his budget proposal, he is now also pushing for $1.8 trillion to expand on child care and health care benefits established in that plan, and $2 trillion for infrastructure, elder care, and broadband.
First up before Congress is the $2 trillion infrastructure and jobs plan, which has already been the subject of a series of offers and counteroffers between the White House and Senate Republicans. So any bipartisan agreement would likely set the total price tag far lower than Biden’s budget currently requests.
Under reconciliation, though, Democrats could potentially get a much larger package — one that more closely resembles the one initially proposed by Biden and present in his budget — passed through Congress without any Republican support.
Previously, Democrats passed their coronavirus relief package via reconciliation, and they could do so again. However, Sen. Joe Manchin (D-WV), defender of the filibuster and the critical (and conservative) 50th vote in the Democrats’ slim Senate majority, has remained publicly optimistic that negotiators can reach a bipartisan deal, telling reporters that “I don’t know why you need reconciliation.”
“We have to find something reasonable and I’m always looking for that moderate, reasonable, middle if you can,” Manchin said Tuesday, according to Politico. “It might not be as big as they want and then you have people on the right that don’t want to do that much or do nothing at all. I probably wouldn’t be there either.”
As Paul Waldman and Greg Sargent wrote in the Washington Post earlier this month, it’s possible the White House is aware that the current talks with GOP senators won’t yield much and are simply letting negotiations play out for Manchin’s sake before pivoting to reconciliation.
But whatever the case, progressives are growing impatient, and are wary of what concessions might be extracted by the Senate GOP on the path to a bipartisan deal.
“Just like we did with the American Rescue Plan, we believe we must go big, bold, and act with urgency,” the House Progressive Caucus said in a statement Friday following the release of Biden’s budget proposal. “We simply cannot afford to limit our ambitions for Republicans or continue to wait for an offer that will never materialize.”