Democrats’ Deception Exposed: Their Reckless Taxing-And-Spending Spree Adds To The Deficit, Fuels Inflation, And Hikes Taxes On The Middle Class

The Congressional Budget Office Confirms That Democrats’ Reckless Taxing-And-Spending Bill Is NOT Paid For, And Will Add $800 Billion To The Deficit Over The Next Five Years

“CBO estimates that enacting this legislation would result in a net increase in the deficit totaling $367 billion over the 2022-2031 period, not counting any additional revenue that may be generated by additional funding for tax enforcement.” (“Summary of Cost Estimate for H.R. 5376, the Build Back Better Act,” Congressional Budget Office, 11/18/2021)

The Congressional Budget Office estimates the Democrats’ reckless taxing and spending bill would add nearly $800 billion to the deficit over the next five years. (“Summary of Cost Estimate for H.R. 5376, the Build Back Better Act,” Congressional Budget Office, 11/18/2021)

This is all in addition to the $528 billion the Democrats’ spring stimulus bill will already add to the deficit in fiscal year 2022. (Congressional Budget Office, Accessed 11/19/2021)

LIE 1: Democrats Repeatedly Asserted Their Spending Spree ‘Does Not Increase The Debt’ And ‘Will Be Fully Paid For’

PRESIDENT JOE BIDEN: “There’s a lot that people don’t understand. And by the way, all this paid for. Every single penny. It’s not going to raise one single cent.” (CNN Presidential Town Hall With President Joe Biden, 10/21/2021)

• BIDEN:  “And it does not increase the debt. When you talk about the number — we shouldn’t even talk about the numbers, because it’s all paid for, written in the same piece of legislation.” (“Remarks by President Biden on the Bipartisan Infrastructure Bill and Build Back Better Agenda,” Scranton, PA, 10/20/2021)

• BIDEN: “And, by the way, you hear these numbers — $3.5 trillion or $1.75 trillion.  We pay for it all.  It doesn’t increase the deficit one single cent.” (“Remarks by President Biden on Build Back Better and the Bipartisan Infrastructure Deal,” Kearny, NJ, 10/25/2021)

WHITE HOUSE PRESS SECRETARY JEN PSAKI: “Well, let’s — let’s not dumb this down for the American public here. What we’re talking about is how much the topline investments are, which are all paid for, so therefore, it costs zero. No matter what the cost or size of the topline investments are, we have ways to pay for it.” (White House Press Briefing, 10/04/2021)

WHITE HOUSE CHIEF OF STAFF RON KLAIN: “It is fully paid for by raising taxes on wealthy people. We have had people become billionaires during the pandemic. They should pay their fair share of taxes…. If we raise taxes on the big corporations who aren’t paying, raise taxes on people using international loopholes, raise taxes on the wealthy who are not paying their fair share, we can pay for every one of those investments in the package without a penny of taxes on people making under $400,000 a year and without a penny being added to the long-term federal debt…. So, I think Senator Manchin’s concerns about inflation, about debts, those are concerns we can address with the provisions of this package itself.” (CNN’s State of the Union, 9/05/2021)

TREASURY SECRETARY JANET YELLEN: “As the speaker noted, we have a variety of different ways to raise revenue. And, all in all, it should be relatively straightforward to raise the revenue necessary to pay for this bill.” (CNN’s State of the Union, 10/24/2021)

HOUSE SPEAKER NANCY PELOSI (D-CA):  “[S]o this legislation will be paid for. In fact, it may be more than paid for. Again, it’s transformative. It’s historic.” (Speaker Pelosi, Press Conference, 10/21/2021)

• PELOSI: “The bill will be fully paid for, and the matter is in the hands of our chairs of the Finance Committee and the Ways and Means committee.” (Speaker Pelosi, Press Conference, 10/21/2021)

REP. PRAMILA JAYAPAL (D-WA): “I will say I agree with the speaker and I think this bill is going to be paid for. I will also say that we now have 49 Democrats in the senate who are ready to do those tax increases…. I would certainly hope the last senator could come along with us. But either way, we’re going to get this thing paid for and get it done.” (CNN’s “The Lead With Jake Tapper,” 10/21/2021)

SENATE MAJORITY WHIP DICK DURBIN (D-IL): . “And the second point I want to make is we are doing this in a fiscally responsible way. What we are proposing in changes and expenditures are paid for, paid for.” (Sen. Durbin, Press Conference, 10/26/2021)

SEN. CHRIS COONS (D-DE): “I’m committed to the principle that we’re not going to add to the deficit with this bill. it’s going to be paid for.” (MSNBC’s “Craig Melvin Reports,” 10/26/2021)

Many Economists Project Democrats’ Reckless Taxing-And-Spending Spree Will Increase Inflation Next Year And Warn That ‘The Risk Of Fueling More Inflation When It Has Reached Record Highs Outweighs The Potential Benefits Of Passing A Big Spending Bill’

“[M]any researchers, including a forecasting firm that Mr. Biden often cites to support the economic benefits of his proposals, say the bill is structured in a way that could add to inflation next year, before prices have had time to cool off. Some economists and lawmakers worry about the timing, arguing that the risk of fueling more inflation when it has reached record highs outweighs the potential benefits of passing a big spending bill that could help to keep prices in check while addressing other social goals. Prices have picked up by 6.2 percent over the past year, the fastest pace in 31 years and far above the Federal Reserve’s inflation target.” (“The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?,” The New York Times, 11/11/2021)

• “Many economists say it could create a short-term stimulus because the plan is structured to raise money gradually by taxing wealthier Americans, who are less likely to spend each additional dollar they have, and redistribute it quickly to people who earn less and are more likely to spend newfound cash. Because of the difference in timing between when the government spends money and when it starts to bring in more revenue, the bill is expected to pump money into the economy in its early years.” (“The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?,” The New York Times, 11/11/2021)

• “Bank of America’s economics team said that core consumer prices would still rise at a 3.2 percent rate at the end of next year, incorporating the assumption that Mr. Biden’s plan passes. Adding a few tenths of a percent to already high inflation might feel more meaningful, moving price gains farther from the Fed’s 2 percent goal.” (“The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?,” The New York Times, 11/11/2021)

• “The roughly $2 trillion tax and spending bill being championed by President Joe Biden will act to push up inflation next year if passed by Congress. That’s according to three senior economists -- Mark Zandi at Moody’s Analytics, Douglas Holtz-Eakin of the American Action Forum and Harvard University professor Doug Elmendorf -- who appeared on a virtual panel sponsored by the National Association for Business Economics on Wednesday.” (“Top Economists See Biden’s Spending Plan Adding to Inflation,” Bloomberg, 11/17/2021)

STEVEN RATTNER, Former Obama Administration Counselor to the Treasury Secretary: “[I]nflation worries are top of voters’ minds. So the [Biden] administration should come clean with voters about the impact of its spending plans on inflation. Build Back Better can be deemed “paid for” only if one embraces budget gimmicks, like assuming that some of the most important initiatives will be allowed to expire in just a few years. The result: a package that front-loads spending while tax revenues arrive only over a decade. The Committee for a Responsible Federal Budget estimates that the plan would likely add $800 billion or more to the deficit over the next five years, exacerbating inflationary pressures.” (Steven Rattner, Op-Ed, “I Warned the Democrats About Inflation,” The New York Times, 11/16/2021)

Even an analysis by Mark Zandi, chief economist of Moody’s Analytics, and Democrats’ favorite economist, found the implementation of Democrats’ multitrillion dollar taxing and spending bill would increase inflation annual growth from 3.8 to 4.0 in 2022. (“Macroeconomic Consequences of the Infrastructure Investment and Jobs Act & Build Back Better Framework,” Moody’s Analytics, 11/04/2021)

• “Moody’s Analytics — the firm that the White House typically cites when arguing in favor of its legislation — estimates that the government will spend $163 billion more on the package than it takes in next year. And the redistribution could make the money more potent as economic stimulus.” (“The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?,” The New York Times, 11/11/2021)

JASON FURMAN, Former Obama Administration Council of Economic Advisors Chairman and Harvard Economist: “It’s more likely a small positive for inflation in 2022…” (“The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?,” The New York Times, 11/11/2021)

DOUG ELMENDORF, Former Director of the Congressional Budget Office and Harvard Economist: “That will tend to push up GDP and employment and inflation -- which is not the policy impulse we need right now.” (“Top Economists See Biden’s Spending Plan Adding to Inflation,” Bloomberg, 11/17/2021)

ETHAN HARRIS, Head of Global Economics Research at Bank of America: “It will make the labor market even hotter and create even more price pressure.” (“The Rethinking of Bidenomics,” Bloomberg, 10/22/2021)

MICHAEL FEROLI, Chief U.S. Economist for JPMorgan Chase: “Right now, anything that expands aggregate demand is not warranted, not advisable.” (“The Rethinking of Bidenomics,” Bloomberg, 10/22/2021)

MARC GOLDWEIN, Senior Policy Director for Committee for a Responsible Federal Budget: “On net, I expect inflationary pressures. Why? a) $200 billion/year of upfront borrowing - spending comes way in advance of offsets b) offsets won’t temper demand much - taxes on corporations and those w/ $25m+ of income won’t change consumption much c) slow supply policies” (Marc Goldwein, @MarcGoldwein, Twitter, 11/10/2021)

THE TAX FOUNDATION: “That would indicate about a $300 billion deficit impact in 2022, amounting to a substantial fiscal stimulus next year that would likely contribute to higher inflation. … [T]o the extent it increases the deficit next year at all, there is reason to think this bill would make the inflation problem worse, not better.” (“How Will Build Back Better Impact Inflation?,” The Tax Foundation, 11/17/2021)

LIE 2: Democrats Have Been Claiming Their Massive Spending Bill Not Only Won’t Increase Inflation, But Will Somehow Magically Lower It

SENATE MAJORITY LEADER CHUCK SCHUMER (D-NY): “It’s simple: if we want to fight inflation, if we want to create more jobs, so many businesses are short of workers and if we want to lower costs and make sure families have more money in their pockets—the best thing, the best thing we can do is to pass Build Back Better. … Stronger growth, less inflation. I’ll say it again: if you want to fight inflation—if you want to lower costs and grow the economy—support Build Back Better. If you want to fight inflation, support Build Back Better.” (Sen. Schumer, Remarks, 11/17/2021)

• SCHUMER: “It’s very simple: if we want to create more jobs, if we want to fight inflation, if we want to help families lower costs—the best thing we can do is to pass Build Back Better. Let me repeat that: Want to fight inflation? Support Build Back Better!” (Sen. Schumer, Remarks, 11/16/2021)

REPORTER: “Why should Americans not be concerned that injecting another $1.75 trillion or more would further raise inflation?”
WHITE HOUSE PRESS SECRETARY JEN PSAKI: “Because no economist out there is projecting that this will have a negative impact on inflation. … That and the Build Back Better Agenda will help reduce inflation, will help cut costs for the American people over the long term.” (White House Press Briefing, 11/15/2021)

BRIAN DEESE, Director of National Economic Council: “And this bill is fully paid for. It’s not going to add to inflationary pressures, quite the opposite, because we’re going to pay for everything in this bill…” (CNN’s ‘State of Union,’ 11/14/2021)

REP. PETER DeFAZIO (D-OR), House Transportation and Infrastructure Committee Chairman: “I rise in support of H.R. 5376 , the Build Back Better Act…. It fights inflation. It is fully paid for.” (Rep. DeFazio, Congressional Record, H.6222, 11/05/2021)

SPEAKER PELOSI’s PRESS OFFICE: “Tonight, Kevin McCarthy previewed Republicans’ very best attacks against the deficit reducing, inflation crushing Build Back Better Act.” (Speaker Pelosi, Press Release, 11/18/2021)

Independent Nonpartisan Analyses Confirm That Democrats’ Taxing Spree Would Raise Taxes On Middle-Income Americans

HOWARD GLECKMAN, Senior Fellow in the Urban-Brookings Tax Policy Center: “Taking into account all major tax provisions, roughly 20 percent to 30 percent of middle-income households would pay more in taxes in 2022.” (“Build Back Better 2.0 Still Raises Taxes For High Income Households And Reduces Them For Others,” Tax Policy Center, 11/11/2021)

According to the Joint Committee on Taxation, more taxpayers earning between $50,000 and $75,000 will receive a tax increase than a tax cut in 2023. (Joint Committee on Taxation, 11/15/2021)

According to the Joint Committee on Taxation, more taxpayers earning between $75,000 and $100,000 will receive a tax increase than a tax cut in 2023. (Joint Committee on Taxation, 11/15/2021)

SEN. MIKE CRAPO (R-ID), Senate Finance Committee Ranking Member: “This analysis proves that any suggestion this bill constitutes a broad-based middle class tax cut is clearly false… The analysis also documents that the Administration’s pledge that ‘no one with income below $400,000 will see their taxes go up’ is not true. Budget gimmicks used in the bill create a structure that substantially frontloads deficit-financed tax relief into the first year, pouring gas onto a currently accelerating inflationary fire. Further, aspirations for tax relief to be extended in future years, without specifying which additional new tax increases would pay for it, promise to dramatically worsen our debt crisis and lead to longer-term inflation pressures.” (Sen. Crapo, Press Release, 11/16/2021)

In Contrast, Two-Thirds Of Millionaires Would See Significant Tax Cuts Next Year Under Democrats’ Bill

“Most millionaires would get a tax cut under House Democrats’ reconciliation plan, according to a new analysis that’s sure to get lawmakers’ attention. About two-thirds of people making more than $1 million would see a tax cut next year averaging $16,800, the Tax Policy Center said Thursday. That’s primarily because Democrats are proposing to lift to $80,000, from $10,000, an annual cap on state and local tax deductions.” (“Most Millionaires Could Get Tax Cut Under House Dems’ Tax Plan,” Politico, 11/11/2021)

“A new analysis from the Joint Committee on Taxation found that the SALT provisions would give two-thirds of people making more than a million dollars a tax cut.” (“Democratic Heartburn Grows Over Middle Class Tax Provision That Also Benefits The Wealthy,” NBC News, 11/18/2021)

According to the Joint Committee on Taxation, 69 percent of taxpayers earning over $1 million would receive a tax cut in 2022. (Joint Committee on Taxation, 11/15/2021)

Nearly 90 percent of taxpayers earning between $500,000 and $1 million would receive a tax cut in 2022. (Joint Committee on Taxation, 11/15/2021)

LIE 3: President Biden Has Vehemently Claimed His Bill ‘Does Not Raise A Single Penny In Tax For Anyone Making Less Than $400,000 A Year’

PRESIDENT JOE BIDEN: “I’m confident that the House will pass this bill, and then we’re going to have to pass it in the Senate. And it’s fully paid for. It will reduce the deficit over the long term, according to leading economists in the world. And again, no one earning less than $400,000 will pay a single penny more in federal taxes.” (President Biden, Remarks, 11/15/2021)

BIDEN: “And so — and keep my campaign commitment: It does not raise a single penny in tax for anyone making less than $400,000 a year. Say it again: Folks, no matter what they tell you, you’re going to find out this will not affect your taxes one little bit in having to pay a penny more if you make less than $400,000 a year.” (President Biden, Remarks, 11/06/2021)

SENATE MAJORITY WHIP DICK DURBIN (D-IL): “It is a legitimate question raised by the Senator from North Carolina: Well, who is going to pay for this? It is paid for by people in the highest income categories. If you are making less than $400,000 a year, your taxes will not go up. That is what Biden said in the campaign, and that is the standard we have been governed by.” (Sen. Durbin, Congressional Record, S.7771, 11/04/2021)

REP. JIM McGOVERN (D-MA), House Rules Committee Chairman: “This bill accomplishes all of this while being fully paid for…. And importantly, it keeps the President’s promise not to raise taxes on those making under $400,000, not even one single penny.” (Rep. McGovern, Congressional Record, H.6217, 11/05/2021)