October 12, 2021
With a 50/50 Senate and the slimmest House majority in US history, there is no mandate from the American people for Democrats to pass the largest welfare expansion since the Great Society. But, no matter, the so-called moderate, Joe Biden, and his fellow Democrats are proposing to radically transform our nation with a mammoth tax and spending bill, purportedly costing $3.5 trillion. Using budget reconciliation, Democrats intend to pass the bill without a single Republican vote.
As if the $3.5 trillion price tag was not insane enough, Democrats are lying to the American people about the cost. According to The Committee for a Responsible Federal Budget, the actual cost to taxpayers is $5.5 trillion. Using shady accounting and cost-shifting, Democrats made the bill appear to cost less than it does.
Not to mention, it is almost guaranteed, if enacted, the welfare programs in this bill will be far more expensive than anyone is currently predicting. Every government program has expanded exponentially from when first implemented, costing a multiple of supposed expert predictions.
In 1965 when President Lyndon Johnson signed Medicare into law, Congressional budgeters believed it would cost $12 billion in 1990. The actual cost that year was $90 billion. In 2019 Medicare ballooned to $800 billion.
Unfortunately, the economically illiterate Socialist wing of the Democratic Party is at the helm of our country. It is unfathomable that Democrats want to spend an additional $6.7 trillion ($5.5 trillion welfare expansion + $1.2 on infrastructure), which does not even include the $4.8 trillion 2021 federal budget. In addition, due to the once-in-a-century global-pandemic the federal government has spent an unprecedented $6 trillion on Covid relief.
To put these insane numbers into perspective, according to the Federal Reserve Bank of St. Louis, President Franklin Roosevelt’s New Deal- one of the biggest expansions of welfare in US history- would have cost $653 billion in 2009 dollars.
If Democrats cared about the country and not just garnering votes to amass more power, they would be concerned with paying for the numerous programs that tens of millions of Americans are already dependent upon. Medicare, Social Security, and Medicaid are all only a few years away from insolvency.
Biden and his fellow Democrats would also not intentionally divide Americans with the false leftist talking point that the “rich don’t pay their fair share”, if they wanted what was best for the country. Truth- According to IRS data for 2018, the top 1% of US income earners paid more than 40% of all federal income tax. The bottom 40% not only paid no federal income tax, but they also got money back from the federal government when they filed their tax return.
It is also a lie that more spending programs are needed to lift those in need. Incredibly, the US spends more than a trillion dollars a year (not even including Social Security and Medicare) on the approximately 90 means-tested welfare programs available to the poor. The programs include government payments for housing, child care, child development, job training, college, utility assistance, food stamps, cash payments, medical care, and even cell phones.
The Objective -Make The Middle Class Dependent On Government
No, the objective of the $5.5 Trillion reconciliation bill, dubbed the Human infrastructure bill is not to give a helping hand to the impoverished- the US already does this. This bill goes far beyond providing for those in need and reaches well up into the middle class, making millions more Americans dependent on government welfare payments.
Making more Americans dependent on “free” money from the government is a losing situation for the country but a win for the Democratic Party. A massive expansion of welfare programs will grow the government bureaucracy, inure the middle class to receiving welfare, disincentivize work and guarantee additional future Democratic voters.
One way Democrats are hoping to make the middle-class dependent on government is to build structural income redistribution into the IRS code through the “child tax credit”.
In March, as part of the Covid relief bill, Democrats temporarily increased the child tax credit up to $3,600 annually per child. Now they want to make this credit permanent. However, calling it a tax credit is a misnomer because there is no work requirement. Even families with no jobs, no income will receive the payment for every child under 18.
Essentially, this is a guaranteed basic income for anyone with children, even financially secure middle-class families. For example, a couple earning $150,000 (which is well above the median US household income) with four children ages 9, 7,4, and 2 would receive $13,200 a year from the government.
Not surprisingly, evidence indicates that the expanded child tax credit will disincentivize work. According to Chicago economists, if the expanded child tax credit becomes a permanent entitlement, 1.5 million workers will exit the labor force.
Incredibly, even illegal immigrants with a US-born child qualify to receive up to $3,600 of US taxpayer-funded payments per child. Reminder- only nine months into Biden’s presidency and his immigration policy changes have allowed approximately one million illegal migrants, many destitute, to enter and live within the US.
Low income, as well as upper-Middle-class families, will also be eligible for: a new universal entitlement for childcare, 12 weeks a year paid family-leave for any family care, free universal pre-k, free community college (illegal immigrants also qualify), elder care subsidies, affordable care act subsidies, new medicare benefits.
In addition to trillions of dollars of new welfare programs, the reconciliation bill also includes funding to enact the Green New Deal, including money to retrofit buildings, subsidies for solar/wind energy and electric cars, along with a myriad of programs for “environmental justice” and “environmental equity”.
Funding for a “Civilian Climate Corps” is also included in the bill. Sounding like a program that would be more appropriate in communist China, the Civilian Climate Corp would employ young activists to help trumpet climate and social justice propaganda. By year five, Democrats are hoping to have 1.5 million left-wing activists on the taxpayer-funded payroll.
Everyone Will Pay-Not Just The rich
Despite our addled president’s claim that this spending bonanza costs nothing, Democrats want to impose two trillion in new taxes on Americans to help pay for this unprecedented spending bill. So, even the claim that this socialist monstrosity will not add to the debt is a lie.
Under the Democrats’ plan, corporate tax rates will rise from 21%-26.5%. Combined with state and local taxes, US corporations will pay the highest tax rate among all nations in the industrialized world. No one with at least a basic understanding of economics could believe that raising the corporate tax rate even higher than communist China’s will not negatively impact the US economy.
As for the Democrat claim that only the “rich” will pay the tax increases in this bill – another lie. According to the nonpartisan Congressional Joint Tax Committee, over the next ten years, low and moderate-income taxpayers would pay 2/3 of the corporate tax increase. They will pay through higher consumer prices and lower wages which will ensue from the tax increase.
The left-leaning Tax Policy Center also concludes that the Democrats plan would raise taxes on 75% of middle-class families within a year and 95% over a decade.
Democrats are also proposing to raise the top federal income tax rate to 39.6% and almost double the top rate on long-term capital gains for the wealthiest Americans,
This increase will not only disincentivize investments but will also harm small businesses. Many small business owners file on the personal tax schedule rather than the corporate one. The last thing that the Millions of small businesses just getting back on their feet need is a burdensome tax increase.
Biden and his fellow Democrats also plan to spend $80 billion to hire 75,000-125,000 new IRS agents, supposedly to go after tax cheats. As part of their plan, they want the IRS to spy on American bank accounts. Banks will be required to register every transaction of $600 or more coming in or leaving with the IRS. Not only is this a disturbing invasion of privacy, but it also makes clear that the Biden administration is not just eyeing the rich to squeeze out more revenue.
Those on the left often point out that other developed nations offer similar welfare programs to those proposed in the reconciliation bill. However, they omit how they pay for them- through massive taxation on all income earners.
The majority of European countries heavily tax all earners, not just the rich. In Denmark-a nation held up as a model by the left because of their social welfare programs – those earning the equivalent of $65,000 US dollars pay the top income tax rate of 56%. In France, those making the equivalent of $30,000 US dollars pay a 30% tax rate. And VAT taxes in most European economies, paid by all, are around 20%.
If Biden succeeds in his bid to massively expand the welfare state those who believe that the rich alone can support this level of spending are delusional. Everyone will pay, and not just with higher taxes.
In the US, we are already seeing the harmful impact of paying people not to work- soaring inflation, labor shortages, supply chain disruptions. Spending trillions more for a myriad of new entitlement programs, combined with massive regulations, in the name of equity and climate change is a plan only the economically illiterate or those who want to remake the US into a socialist economy could embrace. But that is redundant.
