It has been a while since President Joe Biden claimed his policies have reduced the federal deficit. The contention has always been false to the point of absurdity. But the most recent Congressional Budget Office report on the government’s fiscal health should be the final nail in the coffin for any such argument.
The CBO released an update to the Budget and Economic Outlook on Tuesday, showing that this year’s budget deficit is set to rise from the $1.6 trillion predicted as recently as February to $1.9 trillion anticipated now. The increase is due almost entirely to Biden’s policies, most importantly, his college debt amnesty, which raised spending by $145 billion, and to a lesser degree, bipartisan spending on Ukraine, Israel, and the Pacific.
The CBO projected total federal debt held by the public will reach $50.7 trillion in 10 years’ time, $2.4 trillion higher than it calculated five months ago.
How can Biden claim he is reducing deficits when he is presiding over a government that spends $2 trillion more than it is taking in? The falsehood is based on his belief that voters are gullible enough to forget COVID ever happened.
The federal deficit spiked in 2020 to $3.1 trillion, obviously higher than the $2 trillion of deficit spending the government is set to add this year. But that was due almost entirely to revenue reductions caused by COVID lockdowns and emergency spending passed to keep the economy afloat. That was a once-in-a-century calamity that a bipartisan Congress agreed must be met with high spending. It was not general and sustained bad management of the nation’s finances in normal circumstances, as Biden’s $2 trillion disgrace is now.
Once the lockdowns receded, revenue shot back up, no thanks to Biden. If anything, Biden slowed recovery by prolonging lockdowns. More importantly, as past CBO reports show, Biden’s COVID stimulus policies greatly increased spending and deficits from what they would have been had his policies not been enacted. As a result of his reckless spending, Biden’s deficits totaled $1.4 trillion in 2022, $1.7 trillion in 2023, and $1.9 trillion in 2024. Meanwhile, the highest non-COVID deficit under former President Donald Trump was $980 billion, a bad number but not half as bad as Biden’s current fiscal year.
The CBO also noted that immigration has “surged” under Biden, estimating that 8.7 million more immigrants will have entered the country by 2026 than would have happened under normal immigration policies. CBO did note that increased immigration will have a slightly positive impact on reducing federal deficits, but the CBO also said increased immigrant population will be a huge drain on state and local budgets.
“Research has generally found that increases in immigration tend to raise federal revenues more than federal costs but tend to increase the costs of state and local governments more than their revenues,” the report reads. “CBO further expects that the surge will increase state and local costs for education and healthcare, which are two of the largest categories of spending in those governments’ budgets.”
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In February, the CBO noted that Biden’s immigration surge would depress wages for many people. “A significant share of additional foreign nationals will initially work in sectors of the economy that have relatively low productivity,” it reported. “Additional foreign nationals are expected to work in sectors of the economy that pay relatively low wages, thus putting downward pressure on average wages. … The projected increase in workers reduces the amount of capital (factories and machinery) per worker, which also puts downward pressure on average real wages.”
Higher deficits, higher interest rates, and lower wages. That is the economic havoc Biden is delivering, according to the CBO. No wonder he is suffering from historically low approval ratings.