Congressional Budget Office Says Provisions in the Democratic Spending Bill Will Add $3 Trillion to Deficits

According to the Congressional Budget Office, the House version of the Democratic climate and social spending measure would raise government deficits by $3 trillion over the next decade if temporary provisions are made permanent.

According to the Washington Examiner, Republicans requested the figures after criticizing the Democratic proposal as being laced with fiscal tricks to make it appear less expensive. Several expenditure items in the bill have an early sunset date that, if made permanent as Democrats plan, would drive up the program’s cost.

The budget office’s recent analysis is a setback for President Joe Biden’s efforts to pass Congress’s package. It adds to concerns that the spending plan will drive the nation deeper into debt and further fuel inflation. Such concerns have been voiced by Democratic Senator Joe Manchin of West Virginia, whose vote is needed to pass the measure. In November, he said, “This is a recipe for economic crisis” and labeled the provisions “shell games.”

The CBO estimated that the plan would raise government deficits by $367 billion over the next 10 years. The Joint Committee on Taxation also provided a long-term forecast for the enhanced child tax credit if made permanent. It calculated that continuing the program will cost almost $1.6 trillion over the next 10 years. Democrats just increased the child tax credit from $2,000 per kid to $3,600 for children under six and $3,000 for older children.

Treasury Secretary Janet Yellen attempted to combat news of the increased budget analysis by sending a letter to Congress saying, “It is inappropriate to judge this legislation based on an assumption that future acts of Congress won’t be paid for.”

She also said:

“Tomorrow, the Congressional Budget Office is expected to release its analysis. To be clear, this should not be confused with a score of the Build Back Better Act, which was already released. Instead, this analysis is of a bill that the House did not pass, the Senate is not considering, and the President — who has committed to paying for permanent investment — would not sign.”

The Committee for a Responsible Federal Budget, which works for reduced deficits, recently estimated that the measure would cost $4.9 trillion over 10 years if all temporary features were made permanent — far more than Democrats have claimed. The new scoring system will make it more difficult to approve spending legislation. However, the CBO’s bottom-line estimate of the bill’s deficit consequences excludes income from the Democratic proposal to expand IRS enforcement funds. Additionally, the office estimates that the idea would only generate about $207 billion in income over ten years, but the Treasury Department claims it could earn nearly double that amount.

Join The Discussion

Related Posts