It’s hard to comprehend the true scale of the fiscal disaster in Washington D.C. While most Americans feel the impact when gas or milk prices increase by even a nickel, Washington borrows almost $5 billion a day without batting an eye.
The difference between the ridiculous $18.1 trillion in debt from back in 2015 and the ludicrous $39 trillion debt of today seems inconceivable. Numbers this big just don’t seem real.
But if we think of our federal government finances in terms of a family budget, the problem becomes much clearer. So let’s talk about a hypothetical family – The Havernots. The Havernot family earns just under $66,000 a year, which is the same as the average American worker. That equates to a weekly paycheck of $1,266 or monthly earnings of $5,486, before taxes and other deductions.
Most families budget their income and expenses in a responsible manner – carefully allocating their money to basic necessities like housing, utilities, and groceries, while saving what they can for other purposes like retirement, unexpected expenses, and the occasional vacation. That’s the responsible way to manage your finances.
But that’s not how the Havernots live. They spend money in the same manner as the federal government. So for the purposes of this example, we have scaled down the federal government’s income (primarily tax collections) and expenditures (outlays for government programs and, increasingly, interest on the national debt), to match the Havernots&#8217; financial situation.
Once again, the Havernots earn nearly $66,000 and, like the federal government, spend far more than they bring in. In proportion to the federal government, they spend just over $86,500 a year, meaning they have to borrow more than $20,500 annually to cover their expenses. On a monthly basis, the Havernots bring in almost $5,500 while spending a little more than $7,200 a month, a recipe for financial disaster.
Of course, like the federal government, they’re already saddled with a hefty amount of debt due to many prior years of fiscal irresponsibility. The federal government is approaching $39 trillion in debt. That equates to a current debt burden of over $373,000 for the Havernots.
If, like the Havernots, you are currently $373,000 in debt and are adding $20,500 to that debt load each year, you had better have a good plan in place to get your finances in order, with Dave Ramsey on speed dial.
Unfortunately, that’s not the case for the federal government. Looking at projected finances for the federal government, things are going to get much, much worse. On a positive note, government revenue collections are projected to increase by 49.7% over the next ten years, and expenditures are expected to grow by 53.6% over that same period. The total federal debt will grow by 76%.
That means the outlook for the Havernots is equally depressing. Looking down the road 10 years, their income would increase from $66,000 to just over $98,500, which is great news. Until you realize that their annual expenditures grow from about $86,500 to about $132,950 over that same period, forcing them to borrow more than $46,000 annually. And their total debt burden has grown from $373,000 to more than $656,500. This is an unsustainable trajectory for the Havernots.
The silver lining for the Havernots is that some of their spending is being used to improve their financial standing. For instance, by steadily paying off their auto loan and mortgage, the Havernots will, in time, fully own their car and home. But the debt our nation is racking up isn’t putting us on a path to homeownership; it’s careening us toward homelessness.
The Havernot family’s disastrous situation should make it clear: President Trump and Congress need to work quickly to turn our nation’s finances around. There is no magic wand or silver bullet to reverse decades of fiscal irresponsibility, but there is hope.
The best option is a Balanced Budget Amendment to the U.S. Constitution, as it would guard against the gimmicks and end-arounds that Congress regularly employs to skirt budgetary restraints.
A second-best option is creating a bipartisan debt reduction commission with the ability to push an aggressive plan directly to the floor of the House and Senate for a vote.
No matter the approach, it’s imperative for everyday Americans to make their voices heard in Washington if things are ever going to change.
And policymakers – just like the Havernots – need to gather around the kitchen table for an honest conversation about our current predicament and a sincere attempt at doing the right thing.
* * *
Brandon Arnold is Executive Vice President of National Taxpayers Union.
The views expressed in this piece are those of the author and do not necessarily represent those of The Daily Wire.

Month revenue of young couple

What America’s $39 Trillion Debt Looks Like On A Family Budget

Budget

Congress

Congressional Budget Office (CBO)

Dave Ramsey

Economy

Federal Government

finance

National Debt

Opinion

Stock Market

SHAPIRO: 11 Leftist Myths About Economics 

Ben Shapiro

Economics

Leftists

Taxes

Climate initiatives laid out in President Joe Biden’s Inflation Reduction Act (IRA) come with a bigger price tag than anticipated: over $400 billion more, per the latest estimates. 
The Congressional Budget Office (CBO) <a href="https://www.cbo.gov/publication/59710#data">revealed</a> the increased $428 billion cost in its budget and economic outlook for the next decade. The agency admitted that its projections were subject to change, citing variables such as the pace of deployment and use of low-emissions technologies and electric vehicles, as well as the number of taxpayers who have yet to claim certain tax credits enacted in the IRA. 
“The budgetary effects of energy-related tax provisions remain highly uncertain,” stated CBO. 
The CBO originally <a href="https://www.cbo.gov/system/files/2022-08/hr5376_IR_Act_8-3-22.pdf">estimated</a> in 2022 that the IRA’s climate and energy provisions would cost around $400 billion. However, other corporations and organizations said that number was far too low. 
Shortly after CBO issued its estimate, the global investment banking company Credit Suisse <a href="https://www.credit-suisse.com/about-us-news/en/articles/news-and-expertise/us-inflation-reduction-act-a-catalyst-for-climate-action-202211.html">estimated</a> the climate initiatives would cost over $800 billion. That number is closer to CBO’s most recent estimate. 
Other recent, outside estimates have been higher. An August report from the University of Pennsylvania Wharton School of Business <a href="https://www.dailywire.com/news/bidens-green-energy-boondoggle-keeps-getting-bigger">predicted</a> that the IRA’s climate and energy provisions would cost taxpayers over $1 trillion.
The CBO explained that technical revisions resulted in the substantially higher projections, most of which ($224 billion) <a href="https://www.cbo.gov/system/files/2024-02/59710-Outlook-2024.pdf">arose</a> from clean vehicle tax credits and revenues from excise taxes on gasoline. Of that total, $151 billion came from reductions in projected revenues and $73 billion came from increases in projected outlays. 
Much of the higher projections came from the Environmental Protection Agency (EPA) proposal last year to impose more stringent vehicle emissions standards beginning with the 2027 model year. 
<a href="https://onelink.to/dwapp" target="_blank" rel="noopener noreferrer" aria-describedby="sk-tooltip-9096" data-saferedirecturl="https://www.google.com/url?q=https://onelink.to/dwapp&amp;source=gmail&amp;ust=1707591998756000&amp;usg=AOvVaw25BBjfj8wpQhA6F0A4qnyA">CLICK HERE TO GET THE DAILYWIRE+ APP</a>
The CBO further noted that Treasury guidance determined that credits claimed by businesses for leased vehicles weren’t subject to restrictions applied to credits claimed directly by individuals, such as a buyer’s income, eligible vehicle pricing, critical mineral sourcing locations, battery component manufacturer locations, and final vehicle assembly locations. 
“Dealers and buyers have responded to that guidance by leasing more electric vehicles than [the Joint Committee on Taxation] anticipated when preparing its 2022 estimates,” said CBO. 
Apart from the cost of Biden’s climate initiatives, the CBO report didn’t lend a positive outlook for the nation’s economy.
The CBO projected that the nation’s deficit would steadily mount, reaching $2.6 trillion in 2034 from $1.6 trillion in this fiscal year. In relation to GDP, the deficit is projected to reach 6.1% in 2034. The CBO said that these deficit levels were similar to those experienced during some of the greatest national crises.
“Since the Great Depression, deficits have exceeded that level only during and shortly after World War II, the 2007-2009 financial crisis, and the coronavirus pandemic,” read the report. 
Debt held by the public would increase to 116% of GDP by 2034 ($48.3 trillion) and would continue to grow to 172% of GDP in 2054, up from the 99% projected at the end of this year ($26.2 trillion). 
According to the CBO, that 2034 estimate would mark an all-time historical high for the nation, a record reached due to increases in mandatory spending and interest costs outpacing declines in discretionary spending as well as revenue and economic growth.

Joe Biden

Climate Initiatives In Biden’s Inflation Reduction Act Will Cost Over $400 Billion More Than Initially Expected, CBO Says

Climate Change

Inflation Reduction Act

Politics

The House GOP <a href="https://rules.house.gov/bill/118/hr-Israel-Supplemental" target="_blank" rel="noopener">plan</a> to <a href="https://www.dailywire.com/news/house-gop-proposes-israel-aid-offset-by-irs-budget-cuts" target="_blank" rel="noopener">offset $14.3 billion</a> in aid for <a href="https://www.dailywire.com/topic/israel" target="_blank" rel="noopener">Israel</a> by slashing the same amount of funds meant for the <a href="https://www.dailywire.com/topic/internal-revenue-service-irs" target="_blank" rel="noopener">Internal Revenue Service (IRS)</a> would add to the federal deficit, according to a new analysis.
A cost estimate released by the Congressional Budget Office (CBO) <a href="https://punchbowl.news/cbo_estimate_for_the_israel_security_supp_approp_act_2024/" target="_blank" rel="noopener">found</a> the proposed $14.3 billion cut to IRS funding would &#8220;decrease revenues by $26.8 billion over the 2024–2033 period, resulting in a net increase in the deficit of $12.5 billion over that period&#8221; if enacted this month, relative to CBO&#8217;s May 2023 baseline.
The analysis by the nonpartisan agency gave congressional Democrats more ammunition to criticize the GOP measure, which they had claimed would benefit rich tax dodgers. &#8220;Shocking! Turns out letting wealthy people and corporations evade their taxes isn&#8217;t fiscally responsible,&#8221; <a href="https://twitter.com/WaysMeansCmte/status/1719722329796755929" target="_blank" rel="noopener">quipped</a> the X account for the House Ways and Means Committee Democrats.
New House Speaker <a href="https://www.dailywire.com/topic/mike-johnson" target="_blank" rel="noopener">Mike Johnson</a> (R-LA) indicated the plan was meant to be a starting point for negotiations with the Democrat-controlled Senate, describing it as a <a href="https://twitter.com/kayleighmcenany/status/1719077935238222161" target="_blank" rel="noopener">&#8220;first draft&#8221;</a> during an interview with Fox News. He also said the United States is &#8220;not just going to print money and send it overseas&#8221; and that he believes the American people would say that &#8220;standing with Israel and protecting the innocent over there is in our national interest and is a more immediate need than IRS agents.&#8221;
President Joe Biden asked Congress to approve roughly <a href="https://www.nytimes.com/2023/10/20/us/politics/bidens-funds-israel-ukraine.html" target="_blank" rel="noopener">$106 billion</a> in national security-related funds, including $14.3 billion for Israel — which is now at war following Hamas&#8217; deadly terrorist attacks on Israeli soil earlier this month. Biden&#8217;s request also sought $61.4 billion for Ukraine in its fight against Russia, as well as money for Taiwan and the Indo-Pacific, humanitarian assistance, and border security.
Some GOP lawmakers in Congress have called for <a href="https://twitter.com/chiproytx/status/1718038950609092964" target="_blank" rel="noopener">stand-alone bills</a> and <a href="https://twitter.com/RepAndyBiggsAZ/status/1719731726639870439" target="_blank" rel="noopener">demanded</a> more fiscal oversight. Others have <a href="https://www.politico.com/live-updates/2023/10/24/congress/bidens-big-bill-in-trouble-ukraine-israel-border-00123292" target="_blank" rel="noopener">signaled they are open</a> to linking financial assistance packages. Minority Leader <a href="https://www.dailywire.com/topic/mitch-mcconnell" target="_blank" rel="noopener">Mitch McConnell</a> (R-KY) delivered remarks on the Senate floor on Tuesday in which he said threats to the <a href="https://www.dailywire.com/topic/united-states" target="_blank" rel="noopener">United States</a> are <a href="https://www.dailywire.com/news/mcconnell-warns-of-intertwined-threats-amid-debate-over-israel-and-ukraine-aid" target="_blank" rel="noopener">&#8220;intertwined&#8221;</a> and called on Washington to rally behind its allies. A bipartisan, 60-vote coalition is needed to overcome a filibuster in the upper chamber.
<a class="c-link c-link--focus-visible" href="https://onelink.to/dwapp" target="_blank" rel="noopener noreferrer" data-stringify-link="https://onelink.to/dwapp" data-sk="tooltip_parent" aria-describedby="sk-tooltip-6989">CLICK HERE TO GET THE DAILY WIRE APP</a>
IRS Commissioner Daniel Werfel reportedly <a href="https://www.dailywire.com/news/irs-chief-claims-14-3-billion-israel-aid-offset-would-cost-90-billion-report" target="_blank" rel="noopener">said</a> the proposed offset for Israel aid would cost $90 billion, according to Washington Post reporter Jacob Bogage, who conveyed the comments <a href="https://twitter.com/jacobbogage/status/1719474212576858201" target="_blank" rel="noopener">in a post to X</a> on Tuesday. &#8220;All of those funds go to increased scrutiny on tax evasion going on at the highest wealth levels,&#8221; Werfel said, adding that the IRS would be &#8220;leaving money on the table.&#8221;
The House GOP proposal aims to further cut the budget of the IRS after Biden secured $80 billion through the Inflation Reduction Act to bolster and modernize the agency over ten years — with an agenda to commit <a href="https://www.cnbc.com/2022/08/08/reconciliation-bill-includes-nearly-80-billion-for-irs-funding.html" target="_blank" rel="noopener">more than half</a> of the money to enforcement, particularly in <a href="https://www.nytimes.com/2023/04/06/business/economy/irs-tax-treasury.html#:~:text=WASHINGTON%20%E2%80%94%20The%20Internal%20Revenue%20Service,down%20on%20wealthy%20tax%20evaders." target="_blank" rel="noopener">going after wealthy tax evaders</a> — only for up to <a href="https://www.bloomberg.com/news/articles/2023-06-08/yellen-says-cut-to-irs-rebuild-won-t-affect-near-term-plans" target="_blank" rel="noopener">$21.4 billion</a> to get clawed back as part of a <a href="https://www.dailywire.com/news/biden-signs-bill-to-increase-debt-ceiling-avoid-federal-default" target="_blank" rel="noopener">debt ceiling deal</a> in June. A preliminary CBO analysis <a href="https://www.budget.senate.gov/imo/media/doc/CBO%20Preliminary%20Score%20of%20IRS%20Rescissions%206-1-23_Redacted.pdf" target="_blank" rel="noopener">estimated</a> a $21.4 billion IRS cut would increase the deficit by $19 billion over ten years because of lost revenue.

Speaker of the House Mike Johnson

House GOP Proposal To Offset Israel Aid With IRS Cuts Would Increase Deficit, CBO Finds

House Republicans

Internal Revenue Service (IRS)

Israel

Mike Johnson

U.S. House of Representatives

The <a href="https://www.dailywire.com/topic/congressional-budget-office-cbo" target="_blank" rel="noopener">Congressional Budget Office</a> warned on Friday that there exists considerable “uncertainty” with respect to government <a href="https://www.dailywire.com/topic/budget" target="_blank" rel="noopener">funds</a> over the next several weeks as congressional leaders negotiate over a potential <a href="https://www.dailywire.com/topic/debt-ceiling" target="_blank" rel="noopener">debt ceiling</a> increase with the <a href="http://dailywire.com/topic/biden-administration" target="_blank" rel="noopener">White House</a>.
The debt ceiling, a policy established by <a href="http://dailywire.com/topic/congress" target="_blank" rel="noopener">Congress</a> that prevents the federal government from spending beyond a predetermined national debt limit of $31.4 trillion, surpassed the threshold earlier this year. Treasury Secretary Janet Yellen <a href="https://www.dailywire.com/news/yellen-warns-of-debt-default-as-early-as-june-1" target="_blank" rel="noopener">warned</a> last week that the nation could face a default as soon as June 1 unless the debt limit is suspended or increased.
The Congressional Budget Office, a nonpartisan agency which provides lawmakers with budgetary and economic analysis, cautioned in a <a href="https://www.cbo.gov/publication/59160" target="_blank" rel="noopener">report</a> that the “extent to which the Treasury will be able to fund the government’s ongoing operations will remain uncertain throughout May.” The document added that the “extraordinary measures” officials have used to fund operations for the past several weeks could expire “at some point in the first two weeks of June.”
“If the debt limit is not raised or suspended before the Treasury’s cash and extraordinary measures are exhausted, the government will have to delay making payments for some activities, default on its debt obligations, or both,” the report commented.
Should remaining cash and extraordinary measures last until June 15, on the other hand, the government may be able to fund operations “through at least the end of July” as consumers and businesses pay expected quarterly taxes. “Certain large flows of cash into and out of the Treasury follow a regular schedule that directly affects the amount of debt subject to limit,” the agency added.
Treasury officials can, among other “extraordinary measures,” continue to pause investments into the Thrift Savings Plan and continue to suspend the issuance of new securities for the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund.
Continued disagreement about an amendment to the debt limit between Democrats and Republicans centers on whether the move will occur alongside broader spending reforms. President Joe Biden <a href="https://www.dailywire.com/news/republicans-have-done-our-part-mccarthy-blasts-biden-after-first-debt-ceiling-negotiation-in-months" target="_blank" rel="noopener">discussed</a> mechanisms to increase the debt limit this week with House Speaker Kevin McCarthy (R-CA), House Minority Leader Hakeem Jeffries (D-NY), Senate Majority Leader Chuck Schumer (D-NY), and Senate Minority Leader Mitch McConnell (R-KY).
Biden, who has contended that Republicans are risking economic calamity by asking for spending reforms, said in <a href="https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/05/09/remarks-by-president-biden-on-debt-ceiling-negotiations/" target="_blank" rel="noopener">remarks</a> that he found the meeting to be “productive,” while McCarthy, who noted that Democrats waited more than three months to resume negotiations launched earlier this year, <a href="https://www.speaker.gov/speaker-mccarthys-response-after-white-house-meeting/" target="_blank" rel="noopener">commented</a> that he “did not find progress” in the discussions.
<a href="https://onelink.to/dwapp" target="_blank" rel="noopener noreferrer" aria-describedby="sk-tooltip-9096" data-saferedirecturl="https://www.google.com/url?q=https://onelink.to/dwapp&amp;source=gmail&amp;ust=1683992827801000&amp;usg=AOvVaw1sAvvRJ90ru6ybj_DWo2Gy">CLICK HERE TO GET THE DAILYWIRE+ APP</a>
“The only thing we’re asking is that next year we spend the same amount of money we spent five months ago,” McCarthy said after the meeting, noting that the debt limit talks were the first time all four congressional leaders have met with Biden since the new Congress started earlier this year. “Unfortunately in this meeting I heard nothing new.”
A default would indeed cause a recession should the federal government, a major borrower of funds that investors broadly consider stable, neglect to repay obligations. The national debt, which surpassed the $31.4 trillion debt limit this year to reach $31.7 trillion, is meanwhile a source of persistent financial risk and a damper on economic growth.

Treasury Department

Extent To Which Government Can Be Funded Without Debt Ceiling Is ‘Uncertain,’ Agency Warns

Government Funding For The Next Several Weeks Is ‘Uncertain,' Agency Warns

Biden Administration

Debt Ceiling

Higher spending and lower revenue intake produced a $1.1 trillion <a href="https://www.dailywire.com/topic/budget" target="_blank" rel="noopener">budget</a> deficit in the first six months of fiscal year 2023, according to a <a href="https://www.cbo.gov/system/files/2023-04/58995-MBR.pdf" target="_blank" rel="noopener">report</a> released Monday by the <a href="https://www.dailywire.com/topic/congressional-budget-office-cbo" target="_blank" rel="noopener">Congressional Budget Office</a>.
The federal government spent $3.1 trillion and received $2.0 trillion between October 2022 and March 2023, marking a 13% increase from the $2.8 trillion spent and a 3% decrease from the $2.1 trillion received during the same period in fiscal year 2022.
The budget deficit for the first half of the fiscal year, therefore, increased by $430 billion from the $668 billion deficit seen between October 2021 and March 2022.
Individual income and payroll taxes fell by $33 billion, while collection of corporate taxes increased by $13 billion, and receipts from other sources, such as remittances from the Federal Reserve and customs duties, decreased by $53 billion. Increased spending, on the other hand, largely emerged from $141 billion in additional Social Security, Medicare, and Medicaid costs, as well as an additional $90 billion for interest expenses on the public debt.
“Our fiscal challenges will only become more difficult the longer we wait to do anything,” Committee for a Responsible Federal Budget President Maya MacGuineas said in a <a href="https://www.crfb.org/press-releases/cbo-estimates-11-trillion-deficit-first-6-months-fiscal-year-2023" target="_blank" rel="noopener">statement</a> reacting to the report. “In just five years, the national debt will surpass its record as a share of the economy set just after World War II, when we had no choice but to borrow to win the war. However, we’re in no such emergency now. It’s long past time that policymakers figure out a way to sustainably finance their priorities, not just add the costs to the national credit card.”
The news of the higher expenditures comes amid negotiations between House Speaker Kevin McCarthy (R-CA) and senior Biden administration officials on possible reductions to the budget deficit and an increase for the debt ceiling, a measure established by Congress that disallows the federal government from spending beyond the predetermined statutory limit of $31.4 trillion. Treasury Secretary Janet Yellen <a href="https://www.dailywire.com/news/yellen-warns-congress-extraordinary-measures-have-begun-after-debt-ceiling-breached" target="_blank" rel="noopener">warned</a> lawmakers that she was forced to implement “extraordinary measures” earlier this year to fund the government until early June, after which the government will default on obligations.
The current national debt is $31.6 trillion, roughly 20% higher than the gross domestic product of the United States, according to <a href="https://fred.stlouisfed.org/series/GFDEGDQ188S" target="_blank" rel="noopener">data</a> from the Office of Management and Budget.
President Joe Biden unveiled a budget <a href="https://www.dailywire.com/news/more-taxes-and-more-spending-heres-what-you-need-to-know-about-president-bidens-newest-budget" target="_blank" rel="noopener">proposal</a> last month that would increase expenditures from $5.8 trillion to $6.9 trillion over the next fiscal year while reducing cumulative deficits by $3 trillion over the next decade through several tax hikes on businesses and wealthy individuals. Members of the House Freedom Caucus, led by Rep. Scott Perry (R-PA), announced they would not <a href="https://www.dailywire.com/news/house-freedom-caucus-chairman-responds-as-white-house-lobs-spurious-claims-at-spending-cut-proposal" target="_blank" rel="noopener">vote</a> to increase the debt ceiling unless their counterproposal, which would establish topline discretionary spending at the fiscal year 2022 level for one decade and allow for 1% annual growth, is greenlit by Congress.
<a class="c-link c-link--focus-visible" href="https://onelink.to/dwapp" target="_blank" rel="noopener noreferrer" data-stringify-link="https://onelink.to/dwapp" data-sk="tooltip_parent" aria-describedby="sk-tooltip-24597">CLICK HERE TO GET THE DAILY WIRE APP</a>
“By the end of the decade, if lawmakers do nothing, the deficit will approach $3 trillion. That amount of borrowing outside of a national emergency is plainly unacceptable,” MacGuineas continued. “Budgeting requires tradeoffs, often painful ones that politicians don’t want to grapple with. However, that is what they were elected to do, and they should consider the needs of both current and future Americans in upcoming fiscal negotiations. We simply cannot afford to ignore our unsustainable borrowing any longer.”

US Capitol

Deficit In First Six Months Of Fiscal Year 2023 Surpasses $1 Trillion

Deficit In First Six Months Of Fiscal Year 2023 Increases $430 Billion From Previous Period

The <a href="http://dailywire.com/topic/biden-administration" target="_blank" rel="noopener">White House</a> intends to cut the federal <a href="http://dailywire.com/topic/national-debt" target="_blank" rel="noopener">budget deficit</a> by a total of $3 trillion over the next decade, a reduction that falls short of the $20 trillion in cuts required to balance the budget.
An unnamed senior White House official <a href="https://apnews.com/article/biden-budget-deficit-trillion-republicans-economy-810ff80dcd8812f2138eef571f2444f3" target="_blank" rel="noopener">told</a> the Associated Press on Wednesday that the commander-in-chief’s next budget proposal, which he is scheduled to unveil on Thursday, will decrease the deficit by $3 trillion over the next decade should lawmakers approve the plan. White House Press Secretary Karine Jean-Pierre confirmed the figure later on Wednesday and said that the proposal “shows the American people that we take this seriously.”
Biden had previously <a href="https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/02/07/remarks-of-president-joe-biden-state-of-the-union-address-as-prepared-for-delivery/" target="_blank" rel="noopener">vowed</a> during his State of the Union address that the budget proposal would lower the deficit by $2 trillion.
A recent <a href="https://www.cbo.gov/publication/58946" target="_blank" rel="noopener">report</a> from the Congressional Budget Office concluded that the federal government is slated to spend $80 trillion in outlays between 2024 and 2033 while procuring $60 trillion in revenues over the same time horizon, implying that the government is slated to accrue $20 trillion in new deficits. The plan from the White House would therefore reduce the deficit by 15%.
“The ongoing deficits are the result of a mismatch between government spending and tax revenue,” Tax Foundation Senior Economist Erica York said in a recent <a href="https://taxfoundation.org/federal-budget-deficit-taxes/" target="_blank" rel="noopener">analysis</a>. “While revenue and spending as a share of GDP will meet or exceed their historical averages, spending growth outpaces revenue growth, leading to persistent deficits. Growing costs for interest, health-care programs, and Social Security drive the relative rise in spending.”
President Joe Biden and House Speaker Kevin McCarthy (R-CA) are presently <a href="https://www.dailywire.com/news/congressional-budget-office-reveals-when-government-will-run-out-of-cash" target="_blank" rel="noopener">negotiating</a> to decrease spending after the debt ceiling, an arbitrary cap on the national debt established by Congress, exceeded the statutory limit of nearly $31.4 trillion earlier this year. Each official has said they will not consider reforms to Social Security and Medicare, raising <a href="https://www.dailywire.com/news/sparing-the-sacred-cow-republicans-and-democrats-refuse-to-touch-social-security-as-debt-crisis-looms" target="_blank" rel="noopener">questions</a> as to whether meaningful spending cuts will be possible since the two programs constituted 46% of the federal budget during the last fiscal year, according to <a href="https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/" target="_blank" rel="noopener">data</a> from the Treasury Department.
Biden has consistently promised to avoid raising taxes on individuals earning less than $400,000 per year and indicated during his State of the Union address that he would reduce deficits by increasing taxes for high-income households and large businesses. “I will pay for the ideas I’ve talked about tonight by making the wealthy and big corporations begin to pay their fair share,” he remarked. “Big corporations aren’t just taking advantage of the tax code. They’re taking advantage of you.”
<a class="c-link" href="https://onelink.to/dwapp" target="_blank" rel="noopener noreferrer" data-stringify-link="https://onelink.to/dwapp" data-sk="tooltip_parent">CLICK HERE TO GET THE DAILY WIRE APP</a>
The White House accordingly <a href="https://www.dailywire.com/news/some-people-can-expect-medicare-tax-increases-under-next-biden-budget" target="_blank" rel="noopener">said</a> on Tuesday that the budget proposal would suggest raising the investment income tax used to fund Medicare from 3.8% to 5% for individuals earning more than $400,000 per year. “Since Medicare was passed, income and wealth inequality in the United States have increased dramatically,” the White House contended. “By asking those with the highest incomes to contribute modestly more, we can keep the Medicare program strong for decades to come.”
Debate over fiscal policy among Republicans and Democrats comes as the national debt surpasses $31.5 trillion and the government faces <a href="https://www.dailywire.com/news/congressional-budget-office-reveals-when-government-will-run-out-of-cash" target="_blank" rel="noopener">insolvency</a> in the next several months. Runaway federal spending has <a href="https://www.dailywire.com/news/national-debt-surpasses-31-trillion-for-the-first-time-republicans-and-democrats-both-to-blame" target="_blank" rel="noopener">occurred</a> under administrations controlled by both major parties.

President Biden Delivers State Of The Union Address

Biden Wants To Cut $3 Trillion In Spending Over The Next Decade. America Needs $20 Trillion In Cuts To Balance The Budget.

Biden Will Cut $3 Trillion From Deficit Over The Next Decade

U.S.

<a href="https://www.dailywire.com/topic/congressional-budget-office-cbo" target="_blank" rel="noopener">Congressional Budget Office</a> Director Phillip Swagel revealed on Wednesday that the federal government could “run out of funds” between July and September.
The federal <a href="http://dailywire.com/topic/debt-ceiling" target="_blank" rel="noopener">debt ceiling</a>, an arbitrary cap on the <a href="http://dailywire.com/topic/national-debt" target="_blank" rel="noopener">national debt</a> established by Congress, exceeded the statutory limit of nearly $31.4 trillion last month, prompting Treasury Secretary Janet Yellen to <a href="https://www.dailywire.com/news/yellen-warns-congress-extraordinary-measures-have-begun-after-debt-ceiling-breached" target="_blank" rel="noopener">launch</a> “extraordinary measures” intended to continue funding the government through the month of June. Swagel, whose agency is tasked with providing analyses of budget and economic information to Congress, said in a <a href="https://www.cbo.gov/publication/58940" target="_blank" rel="noopener">statement</a> that lawmakers should address the debt limit before the government defaults on obligations.
“We project that, if the debt limit remains unchanged, the government’s ability to borrow using extraordinary measures will be exhausted between July and September,” he said. “The projected exhaustion date is uncertain because the timing and amount of revenue collections and outlays over the intervening months could differ from our projections. In particular, income tax receipts in April could be more or less than we estimate.”
President Joe Biden and House Speaker Kevin McCarthy are presently engaged in negotiations to lower federal spending ahead of any changes to the debt ceiling. Republican lawmakers <a href="https://www.dailywire.com/news/here-are-the-concessions-house-speaker-kevin-mccarthy-gave-to-republican-holdouts-to-win-their-support" target="_blank" rel="noopener">struck a deal</a> with McCarthy under which the party’s new majority will introduce a budget that must refrain from increasing the debt limit in the name of fiscal responsibility.
“If the debt limit is not raised or suspended before the extraordinary measures are exhausted, the government would be unable to pay its obligations fully,” Swagel added. “As a result, the government would have to delay making payments for some activities, default on its debt obligations, or both.”
Policymakers at the Federal Reserve have <a href="https://www.dailywire.com/news/federal-reserve-raises-target-interest-rates-by-quarter-point-marking-slowdown-of-aggressive-hikes" target="_blank" rel="noopener">increased</a> target federal funds rates substantially over the past several months, resulting in higher interest rates across the economy as central bankers attempt to quell inflationary pressures. Interest payments on the national debt are therefore slated to be larger than defense expenditures within the next five years, according to a <a href="https://www.dailywire.com/news/interest-payments-on-the-national-debt-on-pace-to-surpass-military-spending" target="_blank" rel="noopener">projection</a> from Moody’s Analytics.
The national debt currently exceeds $31.5 trillion. Swagel said “newly enacted legislation and changes to the economic forecast that boost interest costs and spending on mandatory programs” mean that the cumulative deficit between 2023 and 2032 is slated to increase by $3 trillion. “The increase in mandatory spending is driven by rising costs for Social Security and Medicare,” he continued. “As the cost of financing the nation’s debt grows, net outlays for interest increase substantially.”
Biden and McCarthy have nevertheless <a href="https://www.dailywire.com/news/sparing-the-sacred-cow-republicans-and-democrats-refuse-to-touch-social-security-as-debt-crisis-looms" target="_blank" rel="noopener">vowed</a> not to discuss amendments to Social Security and Medicare. The two programs marked 46% of the federal budget during the last fiscal year alongside other health initiatives, according to <a href="https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/" target="_blank" rel="noopener">data</a> from the Treasury Department. Both trust funds managed by Social Security are slated to be insolvent by 2035, according to a <a href="https://crsreports.congress.gov/product/pdf/RL/RL33514" target="_blank" rel="noopener">report</a> from the Congressional Research Service. The agency recommended increasing payroll taxes or reducing payouts to avoid an automatic reduction for all recipients.
Biden <a href="https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/02/07/remarks-of-president-joe-biden-state-of-the-union-address-as-prepared-for-delivery/" target="_blank" rel="noopener">claimed</a> during his most recent State of the Union address that he oversaw “the largest deficit reduction” in the nation’s history during his first two years in office. Although he presided over a decline in the deficit from $3.1 trillion in fiscal year 2020 to $1.4 trillion in fiscal year 2022, according to <a href="https://fred.stlouisfed.org/series/FYFSD" target="_blank" rel="noopener">data</a> from the Office of Management and Budget, he failed to mention that the record spending occurred due to legislation passed in response to the lockdown-induced recession. The deficit last year still exceeded those witnessed in the years before the crisis.

Congressional Budget Office Reveals When Government Will Run Out Of Cash

Government Will Run Out Of Cash Sometime This Summer Or Fall

The Congressional Budget Office (CBO) admitted that the <a href="https://www.dailywire.com/topic/internal-revenue-service-irs" target="_blank" rel="noopener">IRS</a> will increase audits on middle-class Americans after it received a funding boost from the so-called &#8220;Inflation Reduction Act.&#8221;
In a <a href="https://www.foxbusiness.com/politics/cbo-dems-tax-social-spending-bill-increase-irs-enforcement-middle-class" target="_blank" rel="noopener">letter</a> to Republican House Ways and Means Committee ranking member Kevin Brady (R-TX) and Budget Committee ranking member Jason Smith (R-MO) Thursday, CBO said that at least some of the new tax revenues the <a href="https://www.dailywire.com/news/heres-how-much-bidens-twice-as-large-irs-could-take-from-the-middle-class" target="_blank" rel="noopener">IRS</a> expects to collect over the next few years will come from families that earn less than $400,000 a year. However, the CBO expects the IRS to follow the directives set by Treasury Secretary <a href="https://www.dailywire.com/news/janet-yellen-vows-irs-audits-wont-rise-for-middle-income-americans-but-theres-a-catch" target="_blank" rel="noopener">Janet Yellen</a>, and audits against the middle class will only account for a &#8220;small fraction&#8221; of new tax revenues.
&#8220;As a result of increases in outlays for the Internal Revenue Service (IRS) stemming from the act, the Congressional Budget Office estimates that revenues will increase by $180.4 billion over the 2022–2031 period,&#8221; CBO wrote in its letter. &#8220;CBO projects that some of the increased revenues will be collected from taxpayers with income less than $400,000; the amount will be a small fraction of the total increase.&#8221;
The CBO made reference to a directive issued by Treasury Secretary Janet Yellen earlier this month. In a letter to IRS Commissioner Charles Rettig on August 10, Yellen directed the IRS to use the nearly $80 billion in new IRS funding provided by the <a href="https://www.dailywire.com/news/biden-signs-740-billion-inflation-reduction-act" target="_blank" rel="noopener">Inflation Reduction Act</a> to “improve taxpayer service” and “increase equity in the tax system,&#8221; rather than increase enforcement on middle class families. “I direct that any additional resources — including any new personnel or auditors that are hired — shall not be used to increase the share of small business or households below the $400,000 threshold that are audited relative to historical levels,” Yellen wrote.
In creating its projections, CBO assumed that the IRS would comply with Yellen&#8217;s directive and allocate enforcement resources to focus on what Yellen called &#8220;high-end noncompliance.&#8221; Therefore, it projected that &#8220;an increase in revenues collected from taxpayers with income less than $400,000 &#8230; will constitute a small fraction of the total increase collected from all taxpayers resulting from the increased funding for the IRS.&#8221;
Elsewhere in the letter, CBO noted that the IRS uses multiple collection methods, not just audits. CBO said it believes that with the new funding, the IRS will &#8220;use all available productive approaches to increase revenues and raise voluntary compliance from taxpayers with all amounts of income.” But the IRS typically allocates resources to maximize revenues, so imposing new restrictions will take time and increase administrative costs, and could actually decrease returns. Still, the law is projected to nearly double the IRS&#8217;s budget, increasing it by about 90% by 2031. That would make its annual budget even larger than it was at its peak in 2010. Furthermore, of the additional $79 billion in funding over the life of the law, more than half, about $46 billion, is allocated for enforcing tax laws; the rest of the new funding is allocated for taxpayer services, operations support, and modernization, and other activities.
Despite not directly increasing the number of audits on taxpayers who make less than $400,000 a year, it will still affect them in other ways, CBO projected:
<ul>
<li>Audits will still be conducted at historical rates, boosting audit activity and revenues in general.</li>
<li>Activities other than audits, including collections and document matching, are not constrained by Yellen&#8217;s directive. &#8220;Under the 2022 reconciliation act, the amounts they generate will be greater for taxpayers with all amounts of income,&#8221; CBO wrote.</li>
<li>Voluntary compliance will increase for all taxpayers.</li>
<li>The increased funding for non-enforcement taxpayer services and other activities can also affect revenues if they enable taxpayers to report their income and calculate their taxes more accurately.</li>
</ul>
CBO added in the letter that it will publish a revised cost estimate of the entire reconciliation package in September.

IRS Audit stock photo

CBO: IRS Will Increase Audits On Middle Class, But Only A ‘Small Fraction’ Of New Tax Revenues

CBO: IRS Audits Will Increase Audits On Middle Class, But Only A 'Small Fraction' Of New Tax Revenues

ABC News anchor Jonathan Karl and White House Press Secretary Karine Jean-Pierre had a tense exchange over the so-called &#8220;Inflation Reduction Act&#8221; and whether it would actually reduce inflation.
While appearing on &#8220;This Week&#8221; on Sunday, Jean-Pierre touted the bill, which passed the House on Friday and is expected to be signed by President Joe Biden <a href="https://www.reuters.com/world/us/biden-sign-430-bln-climate-tax-bill-into-law-next-week-2022-08-12/" target="_blank" rel="noopener">this week</a>. But Karl noted that despite the bill&#8217;s name, the <a href="https://www.cbo.gov/system/files/2022-08/58357-Graham.pdf" target="_blank" rel="noopener">Congressional Budget Office</a> says it would have minimal impact on inflation.
&#8220;Inflation has been a number one priority for this president, lowering costs has been a number one priority for this president,&#8221; said Jean-Pierre. &#8220;If you look&#8230;what Democrats in Congress did with this Inflation Reduction Act, the work of this president&#8230; you see that anti-inflation bill, you see that it&#8217;s going to lower costs for Americans.&#8221;
Karl took issue with Jean-Pierre&#8217;s framing.
&#8220;But let me ask you, it’s called the &#8216;Inflation Reduction Act,&#8217; but the Congressional Budget Office, which is nonpartisan, said that there would be a negligible impact on inflation this year and barely impact inflation at all next year, isn’t it almost Orwellian?&#8221; Karl asked. &#8220;How can you call it inflation reduction when the nonpartisan experts say it&#8217;s not gonna bring inflation down?&#8221;
&#8220;I appreciate the question. We’ve actually addressed this with the CBO,&#8221; Jean-Pierre continued. &#8220;It was the top line number; there’s more in there that shows it will have the money from– remember how we’re doing this, too, it’s making sure that billionaires in corporate America are paying their fair share, making sure that the tax code is a little bit more fair, and so when you do that, put it in its totality, you will see that it will bring down, lower the deficit, which will help fight inflation.&#8221;
&#8220;Look, here&#8217;s the thing,&#8221; she added. &#8220;We have 126 economists, both Republicans, both Democrats who have said it’s going to fight inflation, five former secretaries of treasury–&#8221;
&#8220;So you disagree with the assessment of the CBO?&#8221; Karl pressed.
&#8220;Well, there’s more to it than that,&#8221; she replied. &#8220;It was just the way that Republicans did that was so that [they] could make an argument that is false. It is going to fight inflation, it has been proven and said by economists across the board, on the Republican side and the Democrat side.&#8221;

Karine Jean-Pierre

‘Isn’t It Almost Orwellian?’ ABC Anchor Spars With WH Press Sec Over Whether ‘Inflation Reduction Act’ Reduces Inflation

ABC Anchor Spars With WH Press Sec Over Whether 'Inflation Reduction Act' Reduces Inflation

ABC News

Jonathan Karl

This Week

Economists predict that the United States’ debt-to-GDP ratio will reach 210% by 2050 — and that cutting welfare is a far more effective strategy to address the crisis than “taxing the rich.”
According to Penn Wharton Budget Model, a nonpartisan think tank at the University of Pennsylvania’s Wharton School, the United States’ debt-to-GDP ratio is projected to hit 210% within the next three decades.
Since COVID and the lockdown-induced recession, the ratio has<a href="https://fred.stlouisfed.org/series/GFDEGDQ188S"> soared</a> from 108% to 125%. In other words, the national debt is now 25% larger than a full year’s worth of output from the entire American economy.
PWBM released an<a href="https://budgetmodel.wharton.upenn.edu/issues/2021/6/29/interactive-tool-options-to-reduce-the-national-debt"> interactive tool</a> last summer with which Americans can see the effects of tax and spending policies on the federal budget. Among the possible solutions to climbing debt levels are various taxes on the wealthy and various welfare reforms.
The group’s projections reveal that in virtually every category — including debt reduction relative to GDP, economic output, and wealth equality — reforming welfare is significantly more advantageous than raising taxes on the rich.
<h4>Taxing The Wealthy</h4>
The package for raising taxes on the wealthy — which would add $4.1 trillion in budget surplus by 2031 — includes raising the top rate on ordinary income from 37% to 45%; taxing capital gains and dividends at ordinary rates and taxing unrealized gains at death; expanding the base of employment taxes to cover all pass-through income; lowering the estate tax exemption from $11.7 million to $3.5 million; levying an annual 1% tax on net worth above $50 million; and raising the corporate tax rate from 21% to 28%.
Compared to current policy conditions, taxing the wealthy would boost GDP by 2.4%, capital stock by 7.4%, and average wages by 2.1% within the next thirty years — a reality that would thereby lower the projected debt-to-GDP ratio from 210% to 168%.
The policy proposals would severely and disproportionately harm older Americans in the top quintile of income earners, who tend to rely on capital gains. Taxpayers who are 70 years old at the beginning of the simulation would lose an average of $5.7 million in wealth for the remainder of their lives.
Meanwhile, younger Americans in the top income quintile would most strongly benefit; on average, wealthy Americans born fifteen years after the simulation’s start would observe lifetime wealth rise by $159,200.
<h4>Cutting Handouts</h4>
In comparison to taxing the wealthy, however, enacting welfare reform would be more successful in encouraging economic growth — even while pushing debt below current levels.
The package for cutting handouts — which would likewise increase budget surpluses by $4.1 trillion over the next decade — includes slowing Social Security expenditure growth by indexing benefits to the chained Consumer Price Index; making the Social Security benefit formula more progressive; raising the full-benefit Social Security retirement age from 67 to 70; increasing the Social Security payroll tax rate from 12.4% to 14.4%; doubling the Social Security taxable minimum earnings threshold; raising the Medicare retirement age from 65 to 67; and allowing Medicare to negotiate drug prices.
These policies would boost GDP by 5%, capital stock by 9.5%, and average wages by 1.4% within the next thirty years — respectively representing 2.6%, 2.1%, and 0.7% improvements over taxing the wealthy.
Welfare reform would also lower the debt-to-GDP ratio from 210% to 118% — a 50% improvement over taxing the wealthy, and a 10% reduction from 2021 levels.
By enacting cuts to welfare, Americans across both age and income groups more equally share the resulting economic burdens. Although the worst of the impact — a lifetime wealth drop of $38,200 — still applies to wealthy Americans, no cohort would lose nearly as much as under the higher tax environment.
The views expressed in this piece are the author’s own and do not necessarily represent those of The Daily Wire.

Zeisloft – To Cut National Debt, Welfare Reform is a Must

To Cut National Debt, Welfare Reform Is Much Better Than Taxing The Wealthy

Readers Pass

Welfare

A number of high-profile House Democrats may be forced to campaign against one another in New York&#8217;s Democratic primaries, under new House maps released Monday.
New York Special Master Jonathan Cervas released his maps for the New York State Senate and Congressional delegation. Cervas, a professor of political science at Carnegie Mellon University, was appointed by the New York State Supreme Court to oversee the redrawing of district maps, after the <a href="https://www.dailywire.com/news/new-yorks-highest-court-strikes-down-democrats-gerrymandered-congressional-state-senate-maps">New York State Court of Appeals</a> struck down the maps as partisan gerrymanders. The newly-drawn Congressional maps create primary battlegrounds in two districts where high-profile incumbent Democrats will have to campaign against one another.
The first intra-party battleground is in New York&#8217;s 12th Congressional District. The seat is currently held by Rep. Carolyn Maloney, and encompasses the Upper East Side of Manhattan, as well as parts of Queens and Brooklyn. Maloney&#8217;s district currently borders New York&#8217;s 10th District, which encompasses the Upper West Side, as well as Midtown and Lower Manhattan, and parts of Brooklyn. The district is held by Rep. Jerry Nadler. But under the new maps, both Nadler and Maloney&#8217;s homes would be in the 12th District, putting them into a primary against one another.
Both Nadler and Maloney are powerful and longtime members of the Democratic Caucus. Nadler is the chairman of the powerful House Judiciary Committee, and is a member of the House Progressive Caucus. He won a special election in September 1992 to replace the late Rep. Ted Weiss, and was elected to a full term that November. Maloney was also elected to Congress in 1992. She is the chairwoman of the Oversight and Reform Committee, and the Vice Chair of the Joint Economic Committee. She is also a member of the Progressive Caucus.
Both Nadler and Maloney released statements to Twitter announcing their intention to run in the 12th District. “I believe these newly proposed lines by the Special Master violate the NYS constitutional requirements of keeping communities of interest together and keeping the cores of existing districts largely intact,&#8221; <a href="https://twitter.com/JerryNadler/status/1526267248356237316?s=20&amp;t=1qWvOxxnX9dSMPdIKmt7dQ">Nadler</a> wrote on Twitter Monday. &#8220;However, provided that they become permanent, I very much look forward to representing the people of the newly created 12th District of New York.&#8221;
&#8220;I am proud to announce that I will be running to continue to represent the 12th Congressional District,&#8221; <a href="https://twitter.com/CarolynBMaloney/status/1526271453531881479">Maloney</a> wrote. &#8220;A majority of the communities in the newly redrawn NY-12 are ones I have represented for years and to which I have deep ties.&#8221;
The second high-profile battleground is the 16th Congressional District. Cook Political Report House Editor <a href="https://twitter.com/Redistrict/status/1526247612244013057">Dave Wasserman</a> reports that Rep. Mondaire Jones, who currently represents the 17th Congressional District, will be on a collision course with fellow Rep. Jamaal Bowman in the newly-drawn 16th. Jones serves on the Judiciary, Education, and Democratic Steering Committees, and is one of two openly gay black members of Congress. He is also the co-chair of the Congressional LGBT Equality Caucus. Bowman is the only male member of the &#8220;Squad&#8221; and is a member of the Democratic Socialists of America. He also serves on the Education and Science Committees. Jones and Bowman are both members of the Congressional Black and Progressive Caucuses.

Albany

Proposed New York Congressional Maps Set Up Primary Battlegrounds For High-Profile Democrats

2022 Election

Jerry Nadler

New York

Menu