President Joe Biden will propose cutting the deficits by nearly $3 trillion over the next decade in his budget blueprint, the White House announced on Wednesday.
“The president’s budget, which we will release tomorrow, will cut the deficit by nearly $3 trillion over the next 10 years. That’s nearly a $6 trillion difference between the president’s budget and congressional Republicans’ agenda, which would add $3 trillion to the debt,” White House press secretary Karine Jean-Pierre told reporters at Wednesday’s briefing.
Those cuts, Jean-Pierre said, will be paid for by tax reforms aimed at the wealthy and large corporations, as well as cuts to “wasteful spending on special interests, like Big Oil and Big Pharma.”
She went after former President Donald Trump’s fiscal policy, including what she described as a “reckless and unpaid tax handout for the wealthy and large corporations, which added nearly $2 trillion to the deficit.”
The deficit reduction will be a central part of Biden’s budget proposal and a symbolic marker as the president approaches the showdown with House Republicans over the looming debt ceiling crisis.
The White House’s new deficit-cutting figure is aimed squarely at the House GOP, who have said they will not agree to raise the debt ceiling later this year unless the White House negotiates spending cuts.
The White House has said the two should proceed on separate tracks and that raising the debt ceiling is non-negotiable. Administration officials have argued that a combination of the proposals backed by some GOP lawmakers would add more than $2.7 trillion to the national debt.
Biden had said as recently as last week that his budget proposal would cut the deficits by $2 trillion, a figure he first announced last month during his State of the Union address.
“The plan I’m going to show you is going to cut the deficit by another $2 trillion. And it won’t cut a single bit of Medicare or Social Security. In fact, we’re going to extend the Medicare Trust Fund at least two decades,” Biden said.
He continued, “I will not raise taxes on anyone making under $400,000. But we’ll pay for it the way we talked about tonight: By making sure that the wealthy and big corporations pay their fair share.”
Biden’s budget will also in part focus on expanding access to affordable childcare and investments in early education, proposing a boost in federal funding for childcare by billions of dollars and offering free preschool education for the approximately 4 million 4-year-olds in the country, according to an administration official. It is also expected to expand tax credits for businesses that offer childcare benefits to workers.
The administration has made a notable push on this front during Biden’s first two years in office. Last week, for example, the Commerce Department announced that companies that apply to receive federal funding for semiconductor manufacturing would be required to demonstrate how they would provide workers with access to childcare.
More details on Biden’s budget are expected in the coming days as the administration begins its rollout.
The budget is unlikely to become law – presidential budgets rarely pass through Congress untouched – but it is an important marker for Biden’s political future that will be shaped by the fight over the debt limit and his expected reelection announcement later this spring.
Biden has offered up several revenue-raising proposals that could help him reach his deficit reduction goals, including a new tax on households worth more than $100 million and quadrupling the tax on stock buybacks.
He has also proposed cost-saving measures, such as expanding Medicare’s ability to negotiate the price of certain prescription drugs.
This story has been updated with additional details.
MJ Lee contributed to this report.