Guest column submitted by U.S. Senator Mike Crapo
The White House recently released its Fiscal Year 2023 budget proposal. As with last year’s proposal, the Administration’s core fiscal priorities include trillions of dollars in new deficit spending coupled with job-killing tax hikes.
This year, the President is proposing massive deficit spending of more than $1 trillion for every year of the budget window, adding up to more than $14 trillion over ten years before accounting for budget gimmickry. The biggest gimmick this time is a “special reserve fund” used to hide proposals found in the President’s continued push for so-called Build Back Better policies.
The blueprint does nothing to address our ballooning national debt, but rather, debt would climb from $28.4 trillion last year to $44.8 trillion in 2032. The Senate Republican Policy Committee, using current U.S. census data, estimates that amounts to $345,000 per household in the U.S., a number no one can reasonably assert to be “fiscally responsible,” and a burden on future generations.
The bloated budget request is full of tax hikes that have already been rejected by Republicans and Democrats alike, including rate increases on U.S. businesses that would put American companies at a significant competitive disadvantage. Once again, the Administration is proposing a 28 percent corporate tax rate, which would put the U.S. at the highest combined corporate tax rate in the world. Members on both sides of the aisle have resoundingly rejected that proposal, as up to 70 percent of any corporate tax increase is borne by workers. Consumers are already paying more across the board, with wages being eroded thanks to record-high inflation. Families don’t need tax hikes, they need relief--like the historic tax cuts recently signed into law in Idaho.
The Administration is also proposing a global minimum tax rate for U.S. companies at a rate far higher than the rate that would apply to foreign companies, making it more attractive for businesses to be based abroad than in the United States. These proposals would increase taxes on U.S. businesses by more than $1.5 trillion--in addition to the nearly $1 trillion of tax increases included in the partisan House-passed Build Back Better Act--for a staggering total of $2.5 trillion. These tax hikes would come at the worst possible time, crippling companies already dealing with record inflation and massive supply chain disruptions.
Further, at a time of heightened international tensions over the war in Ukraine, the President’s budget prioritizes a spending spree on social programs over needed defense spending. Given the real prospects of continued high and accelerating inflation, the President’s four percent boost for defense is likely to be a cut in defense in inflation-adjusted terms. Compare that to the request for non-defense spending, which is more than double the defense spending request at a whopping $801 billion dollars, or a 14 percent increase year over year. Beyond these parity issues, unsustainable federal spending weakens our economy when a stronger economic position would help us better support our allies. Amid Vladimir Putin’s horrendous aggressions and other international tensions, we need resources to protect Americans, promote our interests, support our partners and assist Ukraine.
The President has proposed an irresponsible budget that would produce trillion-plus dollar deficits and ever-growing federal debt as a share of the overall economy. Worse, these tax-and-spend proposals come on top of record-high inflation, a stealth tax hitting Americans from the gas station to grocery stores. As Ranking Member of the Senate Finance Committee, I will continue to fight against reckless tax-and-spend proposals that will worsen inflation and compromise our economic recovery.
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