President Biden’s bloated budget spells disaster for Main Street America

During the first two years of his administration, President Biden’s reckless policies epitomized his tax-and-spend proclivities and complete disregard for fiscal responsibility. Despite repeated calls from Republicans to abandon his wasteful spending agenda, he approved roughly $6 trillion in new government spending that fueled inflation, forced the Federal Reserve to expedite its aggressive rate hikes, and accelerated the insolvency of Social Security and Medicare. Instead of supporting main street businesses and industry, his new budget proposal saddles small businesses with higher taxes and exacerbates workforce shortages faced by industry. This one-two punch will be catastrophic for our economy.

Regrettably, the President has not learned a single lesson from his disastrous policies. His newly announced $6.9-trillion budget proposes $5 trillion in tax hikes and $1.7 trillion in new federal spending. It increases the net investment income tax from 3.8% to 5%, which wrongfully imposes taxes on unearned income by owner-operated small businesses, and nearly doubles the capital gains tax rate from 20% to 39.6%. It also quadruples taxes on stock buybacks, which disproportionately impacts retirees and slashes long-term investment returns, and increases the corporate tax rate from 21% to 28%, shipping jobs overseas and decimating domestic manufacturing. Additionally, the Global Intangible Low-Taxed Income (GILTI) tax would increase from 10.5% to 21%, causing anywhere between 200,000 and 3.1 million job losses. Even worse, the President’s budget forecasts that our national debt would eclipse $50 trillion by 2033; an $18 trillion increase in just ten years. This accompanies alarming modeling by the nonpartisan Congressional Budget Office that our interest payments alone on our debt will surpass $10.5 trillion over the next decade.

However, his war on main streets and small businesses does not stop there. His plan would repeal many provisions included in the successful Tax Cuts and Jobs Act of 2017 (TCJA), raising taxes on middle-class families and main street businesses, and further complicating our already complex tax code. Among many pro-business, pro-family policies, the TCJA nearly doubled the standard deduction for both individual and joint filers, expanded the child tax credit to $2,000 per child, and implemented a 20% business-income deduction to lower taxes on small businesses. While the Biden Administration is focused on raising taxes on our families, this historic law ensures that Americans rightfully keep more of their hard-earned money. Once again, the President’s budget leaves Main Street America behind and sticks hardworking families with the bill.

Other longstanding tax provisions are also on the chopping block. Instead of incentivizing investment and economic growth, he has proposed eliminating like-kind exchanges and step-up in basis, which would devastate our economy, increase operating costs for main street businesses, and force family farmers to shut down their operations for good. Both like-kind exchanges and step-up in basis are important for small business owners who are looking to improve and expand their companies and for farmers looking to retire and pass their property on to the next generation. It’s obvious that Main Street America is nowhere near the top of President Biden’s list of priorities. Our small businesses and family farmers cannot afford higher taxes, rising input costs, and red tape, which is exactly what the Biden Administration is delivering.

Main Street America deserves real solutions to our debt crisis, reckless spending, and excessive government waste. If we fail to restore fiscal responsibility and protect taxpayer dollars, the current trajectory of our fiscal health spells disaster for business and industry. Republicans will continue our work to reduce our debt, end wasteful spending, and create a vibrant main street economy that benefits our families, farmers, and small businesses. I pledge that’s a promise that we will keep.

This op-ed was originally published in the Carroll Times Herald on April 3, 2023.