The 2022 budget forecasts yearly trillion-dollar deficits over the next decade.
President Joe Biden on Friday unveiled a $6 trillion budget proposal for fiscal year 2022, which includes his costly initiatives already announced, including the American Jobs Plan and American Families Plan.
It also includes his proposal to raise the corporate tax rate to 28% and increase the capital gains tax on the wealthiest Americans to 39.6%, but it still runs a deficit of $1.8 trillion for FY 2022 and continues to run trillion-dollar deficits yearly over the next decade.
Shalanda Young, acting director of the Office of Management and Budget, said that after 2030, the budget policies will then start to reduce annual deficits, speaking on a call with reporters.
The budget unveiling traditionally kicks off lengthy negotiations or fights with Congress, which must approve federal spending.
The Biden administration released its budget on a Friday afternoon before a holiday weekend and as Congress leaves town for a week.
Federal spending would rise to about 25% of GDP and the budget forecasts that the economy would grow 5.2% this year.
The proposal includes $36.5 billion for Title I schools, subsidies for child care, funding for universal pre-K and two years of tuition-free community college.
As Biden faces increasing pressure to act on gun violence with multiple deadly mass shootings having occurred in his young presidency, he is also asking for $2.1 billion, an increase of $232 million above the previous year, to address the problem.
This is separate from the $5 billion he’s proposing to address community violence in the American Jobs Plan.
“This is a solid budget that reflects President Biden’s vision for investing in people and society and ensures that the economy grows, and that everyone shares in the prosperity and it understands that the public sector is a key components and moving,” said Cecilia Rouse, chair of the Council of Economic Advisers.
