President Biden claimed Thursday that Democrats are “close” to passing his sweeping social spending bill — just hours after official data revealed inflation hit a new 40-year high in January, stiffening opposition to the $2 trillion plan.
Biden gave the dubious spin about his agenda’s status in a speech in Culpeper, Va., after annual inflation hit 7.5 percent, which centrist Sen. Joe Manchin (D-WV) said was more reason to resist massive new spending.
“In my Build Back Better legislation that … passed the House of Representatives, we can [lower drug prices]. Now we just have to get it through the United States Senate. And we’re close,” Biden claimed.
The president spoke after getting a rude welcome from protesters. A girl who appeared roughly 7 years old held a sign visible to Biden’s motorcade that said, “Don’t sniff me,” while adults brandished anti-Biden placards that read, “Let’s Go Brandon,” “FJB,” “Biden Sucks” and “Build Crack Better.”
Biden briefly recognized new federal data showing worsening inflation in January, but he tried to turn it into a sales pitch for his stalled spending bill, which would subsidize child care and home health care, among many other initiatives.
“Inflation is up. It’s up. And coming from a family when [if] the price of gas went up, you felt it … it matters,” Biden said. “But the fact is that if we were able to do the things I’m talking about here, it will bring down the cost for average families.”
Biden claimed his bill is “fully paid for” with new taxes and therefore would not worsen inflation — despite the Congressional Budget Office saying the bill would add $367 billion in unfunded spending.
The House passed the sprawling bill with a $2.2 trillion price tag in November — but Manchin accused fellow Democrats of deceptive “gimmicks” that undercounted its true cost by making new programs last for shorter periods of time than proposed new revenue.
A Republican-requested CBO score said that the package would cost about $4.5 trillion and add $3 trillion in deficit spending if programs extended over 10 years, or the same period of time used to calculate new revenue.
On Thursday, Manchin issued a statement saying that Congress must not add “more fuel to an economy already on fire.” He reaffirmed last week that Biden’s Build Back Better Act is “dead” because of his opposition in the evenly divided Senate, where all 50 Republicans oppose the package, which could pass with a bare majority using special budget rules.
Inflation has helped tank Biden’s popularity along with the fate of the bill that includes most of his domestic policy priorities.
The White House has previously described inflation as “transitory,” while Biden himself claimed in December that the prior month’s 6.8 percent annual inflation rate was likely the “peak.” He also said in July that inflation was “temporary” when it was around 5 percent.
The president has blamed inflation on COVID-19 supply chain bottlenecks, the cost of gasoline and the alleged greed of large meat processors. But critics blame his policies, including the $1.9 trillion American Rescue Plan Act, signed in March, which gave $1,400 stimulus checks to Americans who earned up to $75,000 per year, extended a $300 weekly unemployment supplement through Sept. 6 and expanded the annual child tax credit to $3,000-$3,600 per child, up from $2,000.
Biden’s stimulus followed bipartisan legislation in 2020 that doled out about $4 trillion to keep the US afloat during the pandemic. Biden signed in November a $1.2 trillion bipartisan infrastructure bill that the CBO said would add $256 billion to the federal deficit, though Biden argued it would ultimately lower inflation and boost the economy by improving the transportation of goods.
The Build Back Better bill includes $555 billion for environmental programs, $400 billion to fund universal preschool and cap child care costs at 7 percent of income for most families and $200 billion to extend the enhanced child tax credit for families that earn up to $150,000 — from $2,000 to $3,000 per child, or $3,600 for those under six.
The plan also includes $150 billion for home health care for the elderly and people with disabilities through Medicaid, $150 billion for housing including 1 million new “affordable” rental units, $130 billion in new Obamacare subsidies, $90 billion in racial and gender “equity” initiatives, $40 billion for higher education grants and $35 billion to expand Medicare to include the cost of hearing aids.
The bill would increase from $10,000 to $80,000 the “SALT cap” on state and local taxes that can be deducted from federal taxes — costing an estimated $300 billion in lost federal revenue. Another $206 billion in the bill would federally subsidize four weeks of paid private-sector family leave — an item that is opposed by Manchin.
Biden has on at least one occasion acknowledged the possible impact of generous social spending on inflation.
“The irony is people have more money now because of the first major piece of legislation I passed. You all got checks for $1,400. You got checks for a whole range of things,” Biden said in a November speech. “It changes people’s lives. But what happens if there’s nothing to buy and you got more money to compete for getting [goods]? It creates a real problem.”
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