How Democrats Could Hide $2 Trillion in New Spending With Budget Gimmicks

It now seems fairly certain unlikely that President Joe Biden’s $3.5 trillion “Build Back Better” will make it through the U.S. Senate as a $3.5 trillion spending plan.

Instead, the final version of the bill will probably have a topline spending figure of less than $2 trillion. Even Biden is now admitting as much. But it could have up to $2 trillion in additional, hidden costs, too—thanks to at least two potential changes that one budget watchdog group calls “blatant” gimmicks involving the expanded child tax credit and the Affordable Care Act.

Democrats are reportedly considering a one-year extension of the expanded child tax credit, which pays parents $3,000 annually for every child (and an extra $600 for kids under age 6) and is paid out as a refund even for families that owe no federal taxes. Previously, Biden’s plan called for a five-year extension of the child tax credit. As I wrote in September, the five-year extension was a budget gimmick designed to make the tax credit appear to be roughly $700 billion less expensive than it otherwise would be within the standard 10-year budget window. In short, Democrats were signalling that the expanded child tax credit would be permanent, but they were only accounting for half of what it would actually cost to make it permanent.

A one-year extension would be mashing that same “gimmick” button even harder.

In a similar way, Democrats are also reportedly considering a shorter-than-planned extension of the expanded Obamacare subsidies made available during the pandemic. Instead of being extended permanently, those provisions would technically expire after three years—even though everyone knows they are likely to be extended past that sunset date.

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Author: HP McLovincraft

Seeker of rabbit holes. Pessimist. Libertine. Contrarian. Your huckleberry. Possibly true tales of sanity-blasting horror also known as abject reality. Prepare yourself. Veteran of a thousand psychic wars. I have seen the fnords. Deplatformed on Tumblr and Twitter.

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