On Monday, Democrats unveiled a $3.5 trillion budget blueprint that would kick off work on a social and economic policy package that could be the most significant expansion of the nation’s social safety net since Medicare and the Great Society.
The blueprint would allow Senate Democrats to put together legislation this fall that would significantly increase spending on health care, child and elder care, education, and climate change, all of which would be fully funded by raising taxes on the wealthy, large inheritances, and corporations. And, if Democrats and their two independent allies can hold together, the bill could pass the Senate without the support of Republicans.
With the Senate on the verge of passing a $1 trillion bipartisan infrastructure bill, the blueprint could pave the way for Democrats to secure the rest of President Biden’s $4 trillion economic agenda.
“At its core, this legislation is about restoring the middle class in the twenty-first century and giving more Americans the opportunity to get there,” majority leader Senator Chuck Schumer of New York wrote in a letter to his caucus. He stated that the instructions had been carefully coordinated with California Speaker Nancy Pelosi and House Budget Committee Chairman John Yarmuth of Kentucky.
While nonbinding, the budget blueprint calls for a number of key liberal priorities, including those championed by Senator Bernie Sanders of Vermont, the independent chairman of the Senate Budget Committee. It proposes expanding Medicare to include dental, hearing, and vision benefits, establishing a Civilian Climate Corps to combat climate change, and funding to establish universal pre-K and provide two years of free community college tuition.
It also includes key policy priorities such as a path to citizenship for millions of undocumented immigrants and provisions to strengthen labor law enforcement and penalties for employers who violate them. Democrats are attempting to push the limits of the expedited budget process in order to clear policy changes that would otherwise fail to gain Republican support, but strict budgetary rules may ultimately prevent their inclusion.
Democrats appear to have ruled out addressing the approaching statutory limit on the federal government’s ability to finance the nation’s debt in the budget blueprint. The Treasury Secretary, Janet Yellen, said in a statement Monday morning that Congress should address the debt ceiling in bipartisan legislation, despite Republican warnings that they will not join Democrats in doing so.
Ms. Yellen stated that “the vast majority of the debt subject to the debt limit was incurred prior to the administration taking office.” “This is a shared responsibility, and I urge Congress to work together on a bipartisan basis, as it has in the past, to protect the full faith and credit of the United States.” The decision is fraught with danger, because a default on the nation’s debt could spark a global economic crisis. However, increasing the nation’s statutory borrowing limit in the budget resolution would incur political costs: Senate rules require that the provision include a hard number for the debt ceiling increase.
Democrats would rather use separate legislation to extend the Treasury’s borrowing authority to a future date rather than a dollar limit — a far less contentious political target.
