No president in American history has plundered the nation’s treasury as efficiently as Joe Biden is intent on doing. It is as if he is reliving the 1960s, when the TV game show “Supermarket Sweep” featured contestants racing the clock to load their shopping cart as many goodies as time permitted. Even after his tenure in office expires, President Biden‘s extravagance will continue costing Americans dearly for generations to come.
On Wednesday before a joint session of Congress, Mr. Biden touted his success at firing up the U.S. economy by burning trillions of dollars: “After just 100 days, I can report to the nation: America is on the move again.” Americans can only hope “the move” does not mean relocating beneath a bridge.
With the cooperation of a Democrat-controlled Congress, Mr. Biden has authorized $1.9 trillion for COVID-19 relief. The president’s American Jobs Plan, which the Wall Street Journal labeled “the Green New Deal, in disguise,” would cost an additional $2.3 trillion over eight years, financed over 15 years with corporate tax hikes. His American Families Plan would run another $1.8 trillion. The $6 trillion in expenditures would sit atop the president’s $1.5 trillion discretionary budget request for fiscal 2022.
If approved, all those dollars would enlarge the federal debt, which skyrocketed past the ominous level of 100 percent of Gross Domestic Product during the 2020 pandemic year. Going forward, U.S. debt is projected to follow a steep upward trajectory, reaching an unprecedented 195 percent of GDP by mid-century, according to the Congressional Budget Office (CBO).
It’s tempting to think of government spending as Monopoly money, doled out without a care. Indeed, Rep. Alexandria Ocasio-Cortez has essentially made the argument that overspending is not a real thing. In the view of the progressives who embrace modern monetary theory, currency is simply a construct, and governments are free to print theirs as they see fit.
Whether officialdom borrows its budget shortfall from the global market or manufactures it out of thin air, the U.S. dollar has managed to maintain its value relative to other currencies. A doubling of the federal debt in one generation, though, is the kind of irresponsible behavior that could cause sober lenders to wonder whether the buck is worth a plugged nickel.
Up to the present, federal borrowing has remained affordable — with net interest expected to total only 1 percent of GDP in 2021. The CBO forecasts it to rise to a still manageable 2 percent of GDP by 2030, but then climb rapidly to 8 percent of GDP by 2050.
The extraordinary pandemic crisis has warranted extraordinary government expenditures. That much is agreed. But the Biden binge-a-thon goes much further, and the president is spending like he’s going for broke. A voice of moderation is needed, a modern-day Benjamin Franklin to remind Mr. Biden and his fellow spendthrifts that “a trillion saved is a trillion earned.”
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