President Joe Biden could increase federal spending by 25 percent, is hiking corporate taxes and gas prices are at their highest in seven years ahead of Memorial Day.
So when he stopped off in Cleveland to push his infrastructure bill and made an impromptu stop at an ice cream stand, a reporter decided to ask him what flavor he got.
‘Chocolate with chocolate chip,’ he answered after grinning for selfies at the Honey Hut Ice Cream store.
He also questioned why Republican senators were blocking the riot commission, but wasn’t questioned on the latest probe into the origins of COVID or the $6trillion budget he is set to release on Friday.
Biden made the stop after his speech at Cuyahoga Community College where he said the US had ‘turned the tide’ on the pandemic through vaccine distribution and economic recovery programs.
The country has ‘turned the tide on a once in a century pandemic,’ Biden said in remarks at in Cleveland.
He was back in town after having to cancel a planned campaign rally last March as the pandemic raged and GOP Gov. Mike DeWine closed large events, a move Biden said was the ‘right thing.’
President Joe Biden eats an ice cream at Honey Hut Ice Cream in Cleveland, Ohio, on May 27, 2021 after touting his economic plans. He told reporters that he ordered ‘chocolate, chocolate chip’
Reporters and members of the Secret Service surround Biden as he poses for pictures with his ice cream and a boy
President Joe Biden said Thursday the country has ‘turned the tide on a once in a century pandemic’
Biden walks up to the counter to order his scoop during his stop in Cleveland on Thursday
Biden reinforced the message on Twitter, writing: ‘We’ve turned the tide on a once-in-a-generation economic crisis. And now we’re faced with a question: what kind of economy are we going to build for tomorrow?’
He also issued a defense of his tax hike proposals, which will be put out in detail along with their economic impacts in his budget proposal Friday, but which have failed to win over any Republican support in the Senate.
Senate Republicans put out their latest offer of nearly $1 trillion in infrastructure spending, but won’t accept any of Biden’s proposed tax hikes. Instead, they want to take funds from previously enacted coronavirus and economic relief.
He referenced the Trump tax cuts of 2017, which Senate Republicans are rallying to preserve, and appeared to reference ongoing infrastructure negotiations with Republicans.
‘By the way, we had no problem passing a $2 trillion tax plan that went to the top 1 per cent that wasn’t paid for at all,’ Biden said.
‘Well, we’re going to take back some of that 1 per cent money and make them pay for it,’ he vowed.
He also touted his plan to raise the corporate tax rate to 28 per cent, a proposal he has already offered to come down on.
President Joe Biden (C) speaks during a tour of the Cuyahoga Community College Manufacturing Technology Center, on May 27, 2021, in Cleveland, Ohio
Biden looks at 3D printed objects during a tour of the Cuyahoga Community College Manufacturing Technology Center, where he touted his tax hike plans
‘That generates $90 billion additional revenue into the treasury for a year. That could put hundreds of thousands of people to work,’ he said.
He also touted a hike in the top individual income tax rate – ‘allowing every student in America to go to community college for free,’ he said.
‘I don’t begrudge them the money they made. Just start paying your fair share. Just a little bit,’ he said.
‘You want to give the wealthiest people in America another tax cut?’ he asked.
‘I don’t begrudge them the money they made. Just start paying your fair share. Just a little bit,’ he said.
He linked his economic plans to his COVID plan.
‘You’ve got to fix the pandemic before you can fix the economy,’ he said.
He once again pitched a $15 an hour federal minimum wage.
‘No one should work 40 hours a week and live in poverty,’ he said.
Biden spoke about the state of the nation last summer.
‘Ten months ago, we were in trouble. When I was sworn in, there were 10 million fewer jobs, a lot here in Ohio.
Biden also took on his ‘Republican friends’ in Congress who voted against his American Rescue Plan – but have not been shy about touting its benefits for small businesses in their districts.
‘I’m not going to embarrass any one of them, but I have here a list of how back in their districts they’re bragging about the rescue plan,’ he said, earning laughs from a crowd.
‘I mean, some people have no shame,’ he said with a guffaw. ‘But I’m happy. I’m happy they know that it benefitted their constituents.’
‘That’s okay with me. But if you’re going to try and take credit for what you’ve done, don’t get in the way of what we still need to do,’ he continued. ‘The bottom line is this: the Biden economic plan is working.’
His reluctance to share the information didn’t keep him from holding up the card, which a New York Times photographer captured in detail. It listed Mississippi Sen. Roger Wicker, House Minority Leader Kevin McCarthy, and new House GOP Conference Chair Elise Stefanik, among others.
A pool reporter noted the president also purchased 50 orders for staff.
‘No one should work 40 hours a week and live in poverty,’ Biden said
Major inflation fears as Biden prepares to announce a $6TRILLION budget tomorrow that will boost federal spending by 25% – the highest level since WWll
President Joe Biden is set to unveil a massive spending proposal that includes $6 trillion in government funding for the next fiscal year – an amount that would bring federal spending up to levels not seen since World War II and send inflation even higher.
The budget would have the nation continue running deficits of more than $1 trillion, a level it already topped with the onset of the pandemic – with estimated annual deficits of $1.3 trillion amid enacted and proposed federal programs.
It shows the Biden administration’s desire to keep spending despite warnings from economists that it will keep driving up prices across America.
Taxes are also set to increase by $3trillion over the next decade in line with Biden’s proposed hikes in corporate rates and plans targeting Americans making more than $400,000-a-year.
The plan, which will be released in full on Friday, would seek major changes to the economy and welfare systems that have already been reflected in Biden’s $2.3trillion infrastructure proposal, $1.8trillion education and $1.5trillion in spending.
The proposal represents a 25 per cent increase over what former President Donald Trump proposed in his final budget – in a year that would be upended by the coronavirus.
The spending levels would continue on an upward trajectory, hitting $8.2 trillion at the end of a decade, according to detailed top-line numbers leaked to the New York Times.
President Joe Biden’s budget will propose $6 trillion in spending for the next fiscal year
Joe Biden’s tax hikes targeting the rich: Who will have to pay
Capital gains tax on investment sales for those earning more than $1million a year:
Current law: 20%
With an effective rate of 43.4% when the Medicare surcharge is added.
Investors currently pay 23.8% as the top capital gains rate along with the 3.8% net investment income tax, known as the Medicare surtax.
Around 500,000 people in the US, or 0.32% of the population, have recorded a gross income of over $1million.
For those earning more than $1 million in high-tax states, the total rate will be even higher given the combined federal and state tax capital gains.
In New York it could be as high as 52.22% and for Californians it could be 56.7%
Wealthy residents pay Capital Gains on the growth in value of investments when they are sold. They are mainly placed on profitable stock trades and real estate deals. They can also apply to sales of collectible cars, art, businesses, gold.
Investors are taxed on the difference between what they paid for the asset and what they sold it for.
Investments held for at least one year tops out at 20% and those held under a year are taxed the same as salaries and wages. An additional 3.8% tax applies to those earning at least $200,000.
The US rate ranks in the middle of countries around the world.
Investors generally support lower capital gains tax because they say it rewards entrepreneurship and encourages people to sell what they own.
Current top rate: 21%
Proposed top rate: 28%
These hikes have already been proposed in the first part of his infrastructure plan.
He is also targeting US firms’ profits overseas and companies who use offshore businesses.
Biden has still vowed that no one earning under $400,000 a year will pay more taxes in his administration.
Asked if she could confirm reporting on the budget, White House Press Secretary Jen Psaki told reporters traveling to Michigan with Biden to ‘stay tuned.’ She pointed to prior spending laws enacted before and after he took office.
‘The president inherited $3 trillion of spending that had already been done to help get the pandemic under control. What the budget will reflect is that he is going to continue to deliver on his priorities of dong more work to get the pandemic under control, putting people back to work, and those proposals – the American Jobs Plan, the American Rescue Plan, the American Families Plan – will put us on better financial footing over time,’ Psaki said.
Larry Summers, the former director of the National Economic Council for President Obama and a Clinton advisor issued a stark warning for Biden on Wednesday night and urged him to control his spending.
He told a CoinDesk conference: ‘We’re taking very substantial risks on the inflation side.
‘I think policy is rather overdoing it. The sense of serenity and complacency being projected by the economic policymakers, that this is all something that can easily be managed, is misplaced,’ he added.
Prices on everything from food to used cars and lumber have risen sharply since Biden took office and are set to increase.
The budget is Biden’s first chance to put his mark across-the government. The blueprint reflects some of the proposals he has already made – including a major infrastructure program that he first proposed at $2.3 trillion but now wants to trim to $1.7 trillion in an effort to secure GOP support in the Senate.
The big spending boost and ongoing deficits are certain to draw Republican opposition, although the deficit also rose each year Donald Trump was in office and spiked during the pandemic.
It comes among worries among investors about inflation as the government opens up spending to counter economic impacts of the pandemic.
Taxes are expected to rise by $3 trillion over the decade – although getting the hikes through Congress is another matter. Biden is struggling to get a group of Republican negotiators to consider any taxes to pay for infrastructure in negotiations. They are drawing a line against any changes to the 2017 tax cuts.
Fed vice chair Richard Clarida helped sooth some of those concerns Wednesday when he expressed optimism the central bank could engineer a ‘soft landing’ if prices continue to rise. Concerns about inflation have sparked market swings in recent weeks.
The budget is merely a blueprint that each house of Congress will vote on, and will shape the spending bills that the House and Senate try to enact to make the programs reality.
According to the Times look at the budget, Biden’s proposed tax hikes on upper income earners would start bringing the deficit numbers down in the 2030s, at which point they would become fully effective.
The administration is forecasting a deficit of $1.8 trillion in 2022 amid an economic rebound and a series of coronavirus relief proposals that were enacted.
Trump’s proposed budget for 2021 was $4.8 trillion.
The budget also includes language on what would be a major policy change: lowering the Medicare eligibility age to 60, along with a ‘public option’ for Obamacare. Both are complex issues that would require major legislative action. Proposed Medicare changes would also include dental, hearing, and vision coverage, according to the Times.
Annual deficits have been on the rise since 2015, with a big spike amid the pandemic
The public debt is on track to remain above World War II levels for years
Former President Trump’s proposed budget for 2021 was $4.8 trillion, after years of consecutive increases in the deficit
Republicans release $928billion counteroffer to Biden’s $1.7trillion infrastructure plan that rejects corporate tax hikes, uses unspent COVID relief and invests in roads and bridges
Republican senators outlined a $928 billion infrastructure proposal Thursday, a counteroffer to President Joe Biden’s more sweeping plan as the two sides struggle to negotiate a bipartisan compromise and remain far apart on how to pay for the massive spending.
The Republican offer would increase spending by $91 billion on roads and bridges, $48 billion on water resources and $25 billion on airports, according to a one-page summary released by the GOP negotiators.
It also would provide for one-time increases in broadband investments, at $65 billion, and $22 billion on rail.
Republicans have rejected Biden’s proposed corporate tax increase to pay for new investments, and instead want to shift unspent COVID-19 relief dollars to help cover the costs.
‘It’s a serious effort to try to reach a bipartisan agreement,’ said Sen. Shelley Moore Capito of West Virginia, the lead GOP negotiator.
The Republican senators said their offer delivers on ‘core infrastructure investments’ that Biden has focused on as areas of potential bipartisan agreement.
Last week the Biden administration lowered Biden’s $2.3 trillion opening bid to $1.7 trillion. But the GOP insist this is still not enough.
In a memo to the White House, Republicans including Senators Capito, Barrasso, Blunt, Crapo, Toomey and Wicker said: ‘We recognize that your most recent offer leaves us far apart and, coupled with your Memorial Day deadline, leaves little time to close the gap
The Republican offer would increase spending by $91 billion on roads and bridges, $48 billion on water resources and $25 billion on airports, according to a one-page summary released by the GOP negotiators. It also would provide for one-time increases in broadband investments, at $65 billion, and $22 billion on rail
In earlier negotiations. Biden reduced his $2.3 trillion opening bid to $1.7 trillion. Capito is pictured meeting with Biden in the Oval Office on May 13
‘YOUR LATEST OFFER LEAVES US FAR APART’: THE GOP’S MEMO TO BIDEN ON INFRASTRUCTURE BILL
Thank you for meeting with our group on May 13th and for the subsequent meetings with members of your Cabinet and White House staff. We appreciate your willingness to find a path to address America’s infrastructure needs.
We recognize that your most recent offer leaves us far apart and, coupled with your Memorial Day deadline, leaves little time to close the gap. However, proceeding with reconciliation would undermine the good work we have done, and can continue to do, in a bipartisan manner. This week, the Senate took another significant step in moving forward with an infrastructure package. The Environment and Public Works Committee unanimously approved the bipartisan Surface Transportation Reauthorization Act of 2021 by a vote of 20 to 0. In addition, the Senate is currently working through a separate legislative package, the Endless Frontiers Act, which was included in your initial proposal.
When we recently met with you in the Oval Office, we discussed the parameters of an infrastructure package. Specifically, you expressed a funding target of at least $1 trillion over an eight-year period and that baseline funding levels could be included in that target. As a group, we were explicit that policies unrelated to physical infrastructure do not fit in this package. This is not because we do not value these important issues. We simply believe that these policies should be addressed in separate legislation that does not dilute our shared objective of passing this package. We can address these important issues separately without weakening our commitment to building America’s infrastructure. Furthermore, we made clear as a Conference we will not revisit the 2017 Tax Cuts and Jobs Act that provided the fastest economic growth in years, prior to the COVID-19 crisis.
This Republican Roadmap counteroffer is an eight-year infrastructure package that provides $928 billion (inclusive of baseline spending) to address the needs of various types of infrastructure. As updated, the Roadmap includes a $91 billion increase over baseline spending for roads and bridges and a $48 billion increase over baseline spending for water infrastructure during that period. It also includes a one-time increase of $25 billion for airports and $65 billion for broadband, respectively; a $22 billion increase over baseline spending for passenger and freight rail; and an additional $6 billion for water storage in the West.
We propose to offset the Roadmap with a combination of repurposed funding from previous COVID relief packages, user fees, and infrastructure financing. We agree with you that raising taxes on hardworking Americans, especially as we come out of a pandemic, is not an acceptable solution.
With regard to repurposing funding from previous COVID relief packages, the Department of Health and Human Services has already demonstrated the Administration’s willingness to repurpose billions of dollars Congress approved for testing and supplying the strategic stockpile, to address a completely unrelated matter on our southern border. We can identify funding from these packages that is no longer needed as we emerge from the pandemic, or that is not slated to be spent for several years – if at all. As an example, billions of dollars will not be spent by those states that decided to encourage workers to return to work by not paying out unemployment insurance.
We believe that we can reach a bipartisan agreement on infrastructure legislation that will move through regular order. We share your commitment to building an infrastructure system that can meet the needs of our nation. We look forward to continuing our discussions around this framework.