It's been said that America has the greatest debt in the world -- it's all outstanding!
It's also getting bigger. Like a hungry monster, Washington's appetite for taxing and spending is never satisfied. Yesterday, Congressman Ron Estes (R-Kans.) joined me on "Washington Watch" to discuss Joe Biden's massive spending plan and the danger it imposes to our economy and to ordinary American families.
Estes noted something the media almost never mention: The Biden spending plan is now up to $4.3 trillion, but, as he explained, "We already spend $4.7 trillion annually already."
This is even more stunning when you consider that in 2020, the Congressional Budget Office estimated that federal debt -- for that one single year -- accounted for an estimated 102 percent of America's gross domestic product (GDP). Put in perspective, that means that for the first time since the end of the Second World War, Uncle Sam's one-year debt will be larger than the size of the entire U.S. economy.
President Biden said recently that his proposed tax increases would account for $3.6 trillion in new revenue over the next decade. First of all, that amount still falls far short of federal spending for a single year! But Mr. Biden, who has never created a job or signed a single paycheck in his long career, is oblivious to the fact that roughly "70 percent of corporate taxes (are) passed on to workers through lower wages and benefits." In other words, "soaking the rich" means fewer jobs and less pay for ordinary Americans.
Congressman Estes also said that Mr. Biden's tax-and-spend plan will "make the United States less competitive." Under the Trump administration, Estes reported, not a single American company incorporated in a foreign nation because the 2017 tax cut plan made staying here at home so appealing to American firms. However, he said, if the Biden plan is enacted, "we'll get back to the point where our tax rates are so much higher than other countries around the world that businesses will again start taking the jobs overseas and opening up their plants and operations outside the United States."
Recently Senator Mike Lee (R-Utah) drew attention to another aspect of "Bidenomics" -- inflation. The Biden plan, he said, is "the mother of all inflation bombs on our carpet-bombed economy." The equation is really pretty simple: A sudden and massive increase in both federal spending and federal tax rates means that there will be less money in the hands of consumers and the job-creating private sector.
That means there will be fewer purchases by families and the companies they work for. So, to compensate for lower sales, businesses of all types and sizes will raise prices even as incomes stagnate. That's the ugly reality of the inflation Mr. Biden is precipitating.
However, the Biden plan is not only bad economics -- it's social engineering through a much-expanded federal bureaucracy. The measure is loaded with what Clyde Wayne Crews of the Competitive Enterprise Institute calls "progressive pet programs" that will place a huge increase in federal spending and regulation on "autopilot." And as Mr. Crews observes, the Biden spending bill will further encourage "dependency on government not just during crisis but boom times."
As I said on yesterday's program, we need to repair our roads, highways, bridges, and other physical infrastructure. No one disputes that. But the Biden plan takes federal spending not just to a new level of size but also of reach and control. "They're throwing a lot of money around the country," Congressman Estes observed. Indeed, your tax dollars are being yanked out of your wallet and thrown into social engineering we don't need and can't afford.