Mar 11, 2024 - Politics & Policy

Biden's big plans: Wield new budget to stay on offense post-SOTU

Joe Biden smiles next to a flag

President Joe Biden speaks at a campaign event at Pullman Yards on Saturday in Atlanta. Photo: Megan Varner/Getty Images

President Biden will use his budget proposal for fiscal 2025 to double down on tax increases for the wealthiest Americans and large corporations to provide tax breaks for families and lower the deficit, administration officials say.

Why it matters: After a State of the Union address that quelled Democrats' fears about his age, Biden wants to keep his momentum going by staying on offense — and making this State of Union month by sharply contrasting his approach with that of congressional Republicans.

  • In another shot across the GOP's bow, he will accuse Republicans of doing the bidding of pharmaceutical companies.

Driving the news: Biden will send Congress his budget at noon on Monday, filling out the details of the populist economic agenda he's been previewing for months.

  • His campaign will blanket the airwaves with $30 million in ad buys — including a direct-t0-camera ad in which Biden says, "Look, I am not a young guy. That's no secret. But here's the deal. I understand how to get things done for the American people."
  • Biden will hit three states this week, with campaign events in New Hampshire, Wisconsin and Michigan.

Reality check: Like most presidential budgets, Biden's stands very little chance of becoming law.

  • But it gives him an opportunity to define the coming debate over how to grow the economy — and boost the middle class — on his terms.

What we're hearing: As he has in previous budgets, Biden will call for higher taxes on the wealthiest Americans and large corporations with a goal of reducing the deficit by $3 trillion over 10 years.

  • He also will reaffirm his support for Social Security and Medicare, which he has accused Republicans of wanting to cut.
  • "The president's vision of progress, opportunity and fairness stands in stark contrast to congressional Republicans' repeated attempts to slash critical programs the American people count on," an administration official said.

Flashback: Last year Biden proposed a $6.8 trillion budget that included a new billionaire tax that would have forced them to pay at least 25% on all of their income.

Zoom out: Annual deficits have exploded during the Trump and Biden administrations, as both presidents convinced Congress to pass big spending packages to help the country get through the COVID-19 pandemic.

  • During the last three years, the national debt has risen from $27.8 trillion to $34.4 trillion. The increase in interest rates has made servicing that debt more expensive.
  • Interest payments will total $870 billion in fiscal 2024, according to the Congressional Budget Office.

Zoom in: Biden likes to claim that he has reduced annual deficits — including in last week's State of the Union, when he said, "We've already cut the federal deficit by over $1 trillion."

  • The federal deficit did drop from $2.8 trillion in fiscal 2021 to $1.4 trillion in fiscal 2022; that was largely because pandemic stimulus spending ended.
  • In fiscal 2023, the deficit climbed back up, with the federal government spending $1.7 trillion more than it collected in revenue, according to the Congressional Budget Office.
  • Independent fact checkers have called Biden's deficit reduction claims "half true."
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