Mercedes Schlapp, former senior adviser to the Trump 2020 campaign and former senior adviser to the White House for strategic communication, discusses Joe Biden’s plan to reverse Trump’s administration policies, specifically his approach to immigration.
A national debt that has increased while the Trump administration struggled with the financial consequences of the coronavirus pandemic is expected to increase even further as President-elect Joe Biden attempts to implement policies he advocated during the campaign.
The national debt is approaching $ 28 trillion before Biden’s inauguration on Wednesday, after increasing more than $ 7 trillion during Trump’s four years in office. The likely approval of additional coronavirus relief measures in the early days of the Biden government could add more trillions of debt, even before taking into account other policy changes.
The nominee for Biden Treasury Secretary, former Fed chairman Janet Yellen, said “the long-term fiscal path is a cause for concern” during her Senate confirmation hearing on Tuesday. At the same time, she argued that financial aid measures were needed to boost an economy devastated by the pandemic.
US DEBT SET TO EXCEED THE NATION’S GDP FOR THE FIRST TIME SINCE WORLD WAR II, WATCHDOG NOTICES
“Avoiding what we need to do now to tackle the pandemic and the economic damage it is causing would probably leave us worse off economically and with respect to our debt situation than doing what is necessary,” Yellen said at the hearing.
Biden identified several policy objectives, such as an expansion of the Affordable Care Act, which would have a high price if they were enacted. The president-elect faces pressure from the progressive wing of the Democratic Party, which favors aggressive spending to tackle issues such as climate change and the likely opposition from Republicans seeking to curb government spending.
In the days leading up to his inauguration, Biden revealed a $ 1.9 trillion coronavirus relief proposal, which included $ 1,400 in direct payments to Americans and financial aid to state and local governments. Congress has already approved nearly $ 3 trillion in aid under the Trump administration.
Republicans argued against large stimulus packages that would increase national debt, while some Democrats argued that Biden’s initiative does not go far enough to tackle the current financial crisis.
Biden has indicated that he will try to raise taxes on corporations and wealthier Americans in order to pay for his proposed policies. The new president has repeatedly denied Trump’s claims during the campaign that his government would raise taxes on the middle class.
Proponents of a short-term increase in government spending, including Biden, point to low interest rates and argue that an improving economy will help pay off debt in the long run.
“Economic research confirms that in conditions like today’s crisis, especially with such low interest rates, immediate action – even with deficit financing – will help the economy,” said Biden earlier this month.
Before the election, Biden outlined an expansion of the Affordable Care Act that, he said, would result in lower health premiums, deductibles and drug prices for Americans. He supports a “public option”, where Americans can keep their insurance private or adhere to a government plan.
In October, Biden acknowledged that his plan “would cost some money”, requiring $ 750 billion in spending over a 10-year period.
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Biden also pledged to make a $ 2 trillion investment in his first term in sustainable infrastructure and clean energy, as well as additional education spending. The incoming president’s first budget request is expected by March of this year.
Analysts warned of an increase in national debt even before the coronavirus pandemic – and long before Biden took office.
“Never since the Second World War has the country seen deficits in times of low unemployment as large as those we project – nor, in the past century, did it have major deficits during the time we designed,” Phillip Swagel, director of the nonpartisan Congressional Budget Office , said in January 2020.
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