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Photo: NICHOLAS KAMM / Getty Images

President Biden is asking Congress to spend $6 trillion next year, as part of a sweeping budget proposal that incorporates some, but not all, of his campaign promises, including the $4 trillion for infrastructure, social and education spending he announced this spring.

The big picture: Presidential budgets are aspirational and rarely survive first contact with Congress, but they help the White House articulate its priorities and amplify its agenda.

  • "Where we choose to invest speaks to what we value as a nation," Biden said. "This year’s budget, the first of my presidency, is a statement of values that define our nation at its best.
  • Biden’s proposal largely hews to the $2.3 trillion American Jobs Plan and his $1.9 trillion American Families Plan, which call for new investments in hard infrastructure, as well as $400 billion for caregivers, extended tax breaks for families and a commitment to provide another four years of free education to all Americans.

Why it matters: Biden’s budget doesn’t shy away from embracing the federal government as a robust force to achieve his stated policy objectives. And he’s clearly comfortable with deficit spending for the next 10 years.

  • At the end of Biden’s budget window in 2031, he expects federal spending to increase to $8.2 trillion with annual deficits never dipping below $1.3 trillion, and ending at $1.6 trillion in 2031.
  • Total taxes raised will nearly double, from $3.4 trillion in 2021 to $6.6 trillion in 2031, which would be approximately 20% of GDP.
  • While deficits would persist, annual deficits as a percentage of GDP will decline, coming down to around 5% of GDP.
  • In President Trump’s final year in office, the deficit ran at $4.2 trillion after Congress passed several COVID relief packages and the economy cratered after nationwide lockdowns. Deficit as as a percentage of GDP climbed to 16% in 2020.

The intrigue: While Biden will call on Congress to lower the eligibility for Medicare to age 60, his budget won’t make a specific dollar request for the expansion, a policy proposal that Biden adopted under pressure from Sen. Bernie Sanders.

By the numbers: The budget projects real GDP growth of 5.2% this year and estimates that it will decline to 3.2% in 2022, before leveling off at, or below, 2% for the remaining eight years.

  • It predicts an unemployment rate of 4.1% for next year and then 3.8% through 2031.
  • Interest payments to service the public debt will rise from 1.6% of GDP in 2020 to 2.9% of GDP in 2031, with publicly held debt around 120% of GDP.

Go deeper: By increasing the corporate tax rate, both at home and abroad, Biden hopes to capture an additional $2 trillion over 10 years.

What we are watching: Biden is proposing a Pentagon budget of $715 billion, a modest increase from this year’s $704, but below the $722 that Trump offered in his final budget.

  • It also includes $8.7 billion for the Centers for Disease Control and Prevention to help prepare for emerging global threats.
  • Most of the federal workforce will grow, with the Commerce Department taking a 7.4% decrease next year and the Labor Department expecting a 13.5% increase.

The bottom line: Biden is asking Congress for a lot of money and explaining how he’ll raise taxes to pay for his priorities.

  • Now it’s Congress’s turn.

Go deeper

Sep 2, 2021 - Politics & Policy

Manchin to Democrats: "Hit the pause" on $3.5T reconciliation talks

Sen. Joe Manchin. Photo: Al Drago/Bloomberg via Getty Images

Centrist Sen. Joe Manchin (D-W.Va.) is urging his Democratic colleagues to "hit the pause button" on a $3.5 trillion spending bill, citing more urgent priorities like the U.S. withdrawal from Afghanistan and a spike in COVID-19 cases.

Why it matters: Democrats plan to pass that legislation via the budget reconciliation process, paving the way for a massive infrastructure infusion without Republican votes. In a 50-50 Senate, they'll need every single Democrat's support, including Manchin's.

Ben Geman, author of Generate
Sep 3, 2021 - Politics & Policy

Democrats running out of time for climate change action

Illustration: Sarah Grillo/Axios

Democrats' Beltway drama over their $3.5 trillion spending package could influence the outcomes at a critical United Nations climate summit this fall.

Driving the news: Sen. Joe Manchin (D-W.Va.) is calling for a "pause" in senior Democrats' plan to move a $3.5 trillion package that would include major clean energy and climate measures.

12 hours ago - Health

FDA advisory panel recommends Pfizer boosters for those 65 and older

A healthcare worker prepares a dose of the Pfizer-BioNTech Covid-19 vaccine at the Key Biscayne Community Center on Aug. 24, 2021. Photo: Eva Marie Uzcategui/Bloomberg via Getty Images

A key Food and Drug Administration advisory panel on Friday overwhelmingly voted against recommending Pfizer vaccine booster shots for younger Americans, but unanimously recommended approving the third shots for individuals 65 and older, as well as those at high-risk of severe COVID-19.

Why it matters: While the votes are non-binding, and the FDA must still make a final decision, Friday's move pours cold water on the Biden administration's plan to begin administering boosters to most individuals who received the Pfizer vaccine later this month.