With the House nearing a vote on President Joe Biden’s Build Back Better bill, the Congressional Budget Office has projected the measure would add a net $367 billion to the national debt over the next decade.
USA Today said the CBO’s projection “undercuts Biden’s long-standing pledge the bill is not only fully paid for but would decrease the deficit.”
However, the CBO excluded tax revenue from tighter IRS enforcement, which it estimated earlier would raise $207 billion. Subtracting the $80 billion cost of increasing enforcement, the net savings would be $127 billion and Build Back Better would raise the deficit by only $160 billion.
“In the scope of the federal budget, that’s a tiny amount,” The Washington Post said, also noting that “many people think CBO’s figure on the cost savings from tax enforcement is a drastic underestimate.”
The Treasury Department estimates that enforcement would generate $400 billion in revenue, for a net savings of $320 billion, almost $200 billion more than the CBO’s projection. “If Treasury is right, the bill’s effect on the deficit is almost nothing,” the Post said.
Former Treasury Secretary Larry Summers said the way the CBO calculates gains from enforcement “is conservative to the point of implausibility.”
The sweeping $1.9 trillion Build Back Better would deliver on long-standing Democratic priorities by dramatically expanding social services for Americans, working to mitigate the climate crisis, increasing access to health care and delivering aid to families and children.
House Speaker Nancy Pelosi announced a vote on the bill for Thursday night but with House GOP leader Kevin McCarthy bringing action to a halt by speaking for more than three hours on the House floor, Majority Leader Steny Hoyer, Maryland Democrat, said the House would reconvene on Friday morning.
Rules Committee Chairman James McGovern of Massachusetts said Democrats were still working to come up with ways of keeping the measure from adding to the national debt.
“I do believe this bill will be fully paid for,” he said.
A group of Democratic moderates blocked the legislation from coming up for a vote earlier this month without the CBO estimate.