Analysis of spending bill shows it will add to debt and deficit, increase inflation

Democrats, led by President Joe Biden and House Speaker Nancy Pelosi (D-CA), have laughably asserted — and have been slavishly supported by an allied media — that their massive domestic spending proposals will be fully paid for and add nothing to the debt or deficit while reducing inflation and bolstering the nation’s gross domestic product (GDP).

But that isn’t actually the case at all, according to a former Senate aide and Treasury official, as two separate analyses of the so-called Build Back Better Act show that once budgetary gimmicks are stripped away, it will add to the debt, deficit, and inflation while stifling GDP growth, the Washington Examiner reported.

Such is the view of Bruce Thompson, a former Senate aide who also served as assistant secretary of Treasury for legislative affairs as well as the director of government relations for investment firm Merrill Lynch for more than two decades.

His ultimate take, which is surely not what Pelosi or Biden wants to hear, is that Congress has already spent too much money too fast, driving up inflation, and that “we need to slow spending down. And not pass this bill.”

It’s actually quite costly

Thompson looked close at the claims of Democrats like Biden and Pelosi that the approximately $2.4 trillion tax-and-spend bill would be “fully paid for,” and cost taxpayers “zero” dollars in the long run — claims he found to be untrue.

He first looked at the nonpartisan Congressional Budget Office’s (CBO) score of the bill, which revealed that over the first half of the next decade, the bill will actually increase the annual deficit by nearly $800 billion by 2026.

In fact, over each of the next five years an average of $158 billion would be added to the deficit, for a total of around $792 billion in annual spending above and beyond collected revenue by 2026.

Budgetary gimmicks

The reason for that, in comparison to Democratic claims that the bill would cost nothing, is that Democrats have employed a variety of money-shifting gimmicks to the budgetary models, front-loading a majority of the spending to the first five years while much of the anticipated additional revenue won’t flow in until the latter five years, theoretically balancing out over the long-term.

Furthermore, a sizeable chunk of the spending will purportedly “sunset” or expire within the next several years, something that in actuality is unlikely to occur, as most if not all of those programs will eventually be extended, and the supposed future revenue itself to help balance everything is just an estimate and is not guaranteed.

Now, stripping away that front-loading gimmick and assuming that the spending will be extended instead of allowed to expire, an independent analysis of the bill by the Penn Wharton business school found that the spending measure would be far more costly than advertised by Democrats.

In fact, if all of the spending proposals were to be made permanent, the total cost of the bill would essentially double to more than $4 trillion, and would add roughly $2 trillion more to the federal deficit.

That is simply money our nation and economy cannot afford — particularly after having spent several trillion in emergency bills already since the pandemic began — and Thompson concluded, “With inflation rising at the fastest pace in years, we need to slow spending down. And not pass this bill.”

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