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A Look at What’s Inside Biden’s $6 Trillion Plan

A Look at What's Inside Biden’s $6 Trillion Plan


A Look at What’s Inside Biden’s $6 Trillion Plan

President Biden’s first budget request maps out a vision of an expansive federal government in the years to come, with increased spending in areas like infrastructure, education and climate change.The $6 trillion plan for the 2022 fiscal year, released on Friday, provides a detailed accounting of Mr. Biden’s economic agenda. It includes two marquee proposals that he has put before Congress: the American Jobs Plan, which calls for new spending on the nation’s infrastructure, and the American Families Plan, which addresses issues like child care, universal prekindergarten and paid family and medical leave.As part of those plans, Mr. Biden is seeking to increase taxes on corporations and high earners. The president’s tax proposals are detailed in the budget request as well.The budget expands on a proposal that Mr. Biden released in April covering discretionary spending, which sketched out his desire to inject funds across domestic agencies, a sharp reversal from President Donald J. Trump’s spending policies.Here are some of the notable proposals in Mr. Biden’s budget request.— Thomas KaplanClimate change is back in the budget.The budget proposal adds $14 billion in new money across government agencies to policies and programs devoted to climate change — a stark contrast to the Trump administration, which tried, unsuccessfully, to zero out funding for dozens of clean energy programs.It also includes the first request for international climate change assistance since 2017. The Biden administration will ask Congress for $1.2 billion for the Green Climate Fund, a United Nations entity created as part of the Paris agreement on climate change to help developing countries.President Barack Obama pledged $3 billion to the fund but delivered only a third of the money during his term. Mr. Trump withdrew from the Paris agreement and also stopped payments into the Green Climate Fund. Mr. Biden, on his first day in office, recommitted the United States to the global accord and promised to restore Mr. Obama’s foreign aid commitments.Domestically, the Biden administration said its funding across agencies would help build the nation’s capacity to transition from fossil fuels to wind, solar and other renewable energy. The budget proposal also includes details of the administration’s pledge to devote at least 40 percent of spending on climate change to communities of color, which studies have shown are disproportionately affected by both air pollution and climate change.The administration is proposing $11.2 billion for the Environmental Protection Agency, a 22 percent increase from the previous year. The E.P.A. was consistently targeted for deep cuts under the Trump administration, and its climate change and health programs were typically dealt particularly heavy blows.The new blueprint makes the case for new spending on environment infrastructure — like replacing all of the country’s lead pipes — after a decade of budget caps and cuts that the administration said caused the agency’s budget to decline by 27 percent since 2010.It includes $936 million for a new E.P.A. program to address racial disparities in exposures to environmental contamination. That program will include $100 million for air quality monitoring and notification technology in communities that will provide real-time data in places with the highest levels of exposure to pollution.The budget allocates $580 million to plug old oil and gas wells and clean up abandoned mines — a plan the Biden administration has eyed for both new jobs protecting communities against the environmental dangers that thousands of old abandoned mines across the country pose as well as a way to prevent future global warming pollution.David Coursen, a former E.P.A. attorney who works with the Environmental Protection Network of former agency officials, called the budget request “robust” and said it would “help rebuild the agency after years of chronic disinvestment.”— Lisa FriedmanA plan to fund clean energy technologies.President Biden’s budget proposes more than $800 billion over the next decade in new spending and tax breaks in a bid to accelerate the deployment of clean-energy technologies aimed at fighting climate change, from hydrogen fuels to the next generation of nuclear power plants.Mr. Biden has vowed to slash America’s planet-warming greenhouse gas emissions at least 50 percent below 2005 levels by 2030 to help stave off the worst effects of global warming, and the White House is betting that it can reach that goal in large part by using the federal government’s resources to help fund millions of new wind turbines, solar panels and electric vehicles as well as newer technologies that do not produce carbon dioxide.The overwhelming majority of the new energy spending being proposed in the budget would depend on Congress passing Mr. Biden’s infrastructure proposal, which still faces an uncertain fate. Republicans in the Senate have pushed back against spending on items like electric vehicle charging stations.In his budget, Mr. Biden is proposing $265 billion over the next decade to expand and extend federal tax breaks for companies that build clean energy sources such as offshore wind turbines or battery storage on the grid. He is also calling for $9.7 billion worth of tax credits to help maintain America’s existing fleet of nuclear reactors, which do not produce carbon dioxide emissions but have faced the risk of closure in recent years because of competition from cheap natural gas.The budget also proposes $10 billion in tax credits for trucks that do not produce planet-warming emissions, such as those powered by batteries or hydrogen, as well as $6.6 billion for cleaner jet fuels and $23 billion to incentivize new electric transmission lines that can transport wind and solar power from far-flung regions in the country. And it proposes to spend $23 billion over the next decade on tax credits for companies that install “carbon capture” technology at power plants or factories.Mr. Biden is requesting to increase the Energy Department’s budget by $4.3 billion, or 10.4 percent, with much of the focus on enabling the deployment of clean energy sources. That includes $1.9 billion to help make homes more energy-efficient and speed up permitting of transmission lines.Mr. Biden is also calling for federal agencies to spend $50 billion over the next decade to procure clean-energy technologies for their own use, including electrified Postal Service vehicles, lower-carbon materials such as steel and cement, as well as electricity from advanced nuclear power plants that are still under development.To a smaller extent, Mr. Biden is also proposing to cut the federal government’s spending on fossil fuels, by rescinding $35 billion worth of subsidies over the next decade for oil, gas and coal companies, including the repeal of tax breaks for well depreciation and a tax credit for drilling expenses. The administration is proposing to raise an additional $84 billion by changing how the government treats extraction and foreign income for oil and gas producers.In addition to spending, Mr. Biden’s climate plans will depend heavily on a separate proposal for a clean electricity standard that would require the nation’s electric utilities to steadily increase their use of all these new low-carbon energy sources until they had zeroed out their emissions in 2035. That policy is only mentioned in passing in the budget, and it would require Congress’s approval.— Brad PlumerFEMA aims to cushion the rising cost of flood insurance.The Federal Emergency Management Agency, which Mr. Biden has leaned on heavily in the first few months of his presidency, would see its budget stay roughly constant, at about $3.3 billion. Much of the agency’s funding comes in the form of emergency injections of money by Congress after a disaster.But FEMA’s budget request is important for another reason: It shows the administration’s struggle to address the rising costs of climate change, and how those costs affect American households.As climate change gets worse, more frequent and severe floods have pushed FEMA to increase the cost of federal flood insurance, which covers about five million policyholders. Those price increases have generated intense pushback from lawmakers warning that their constituents will suffer — including Senator Chuck Schumer, Democrat of New York and the majority leader, who objected in March to FEMA’s overhaul of rates.The budget request addresses that concern, proposing to help subsidize premiums for homeowners who might not otherwise be able to afford flood insurance. The goal of those subsidies, FEMA says, is to increase the number of people in flood zones who have coverage.The attempt to reform flood insurance is just one indication of the federal government’s concern that climate change, in addition to its growing human toll, will also wreak havoc on the budget.Updated May 28, 2021, 4:32 p.m. ETThe budget request calls the impact of climate change a “primary risk,” one that “will likely have significant effects on the long-run fiscal outlook.”The White House presented that financial concern as a selling point for Mr. Biden’s efforts to cut greenhouse gas emissions. “The budget’s climate policies serve to mitigate long-run impacts of climate change,” the request said.— Christopher FlavelleThe most ambitious health care ideas come with no numbers.The budget for the Health and Human Services Department includes significant increases for the Centers for Disease Control and Prevention and the National Institutes of Health. But it is perhaps more notable for what it does not include.In its budget summary, the White House signaled its commitment to a range of major health reform proposals, including the creation of a public option health insurance plan; an effort to lower prescription drug costs; a plan to lower the age of eligibility for Medicare; and an expansion of Medicare benefits, to add vision, hearing and dental coverage.But the costs of those expansive policy changes were omitted from the official budget calculations, making it difficult to assess their real cost.Those omissions are unusual. The Trump administration’s budgets also included a number of large health policy initiatives, such as repealing provisions of the Affordable Care Act and a different set of prescription drug reforms. That administration’s budgets included at least a rough accounting of the costs and savings associated with those ideas.Several of the proposals are the subject of active discussion on Capitol Hill. The leaders of two key congressional committees announced this week that they would begin work on a new public option proposal, which would allow certain Americans to buy a government-run health insurance plan instead of private insurance. The House has worked for years on a bill to lower prescription drug prices and extend Medicare benefits for more services. And progressives have been pushing for expanded Medicare eligibility in recent months, a proposal that was also part of Mr. Biden’s campaign platform.Unlike the budgets of the Obama and Trump years, the Biden budget does not propose any policy changes in Medicare. Both previous administrations had suggested a series of small changes meant to improve the efficiency of the program without reducing benefits. Instead, the budget summary document notes that “that we can reform Medicare payments to insurers and certain providers to reduce overpayments and strengthen incentives to deliver value-based care,” a possible sign that such initiatives could be considered in the future. The only major change in Medicare is an expansion of the budget for its fraud unit, additional spending that is estimated to result in about $1 billion in savings a year.While each of the unspecified policy ideas is popular with Democratic voters, each has the potential to upset key health care lobbies, by reducing their funding or replacing their market share with direct government services.The budget does include an extension of new Obamacare subsidies passed by Congress as part of the American Rescue Plan. Those subsidies, which lower the cost of health insurance for most Americans who buy their own insurance, are estimated to cost $163 billion over the next decade. It also includes an additional $400 billion over a decade in spending for home and community-based care for elderly and disabled people, a change proposed as part of the American Jobs Plan.— Margot Sanger-KatzFunding to deal with migrants at Southern border.Mr. Biden requested $3.2 billion for the office that manages migrant children and teenagers who have been arriving alone at the U.S.-Mexican border in record numbers this year. It is a $1.3 billion increase over what the Trump administration sought in the 2021 budget request.The budget includes funding for asylum and refugee programs to support as many as 125,000 admissions in fiscal year 2022. And to address the backlog in immigration cases, the budget includes $891 million for immigration judges and their staff. As part of that effort, the administration requested $345 million for the United States Citizenship and Immigration Services to process asylum cases that have been backlogged for years.The administration has been struggling to place migrant children housed in Health and Human Services centers with family members in the United States, which as of Wednesday, is taking an average of 39 days.The budget request includes $15 million to test a new program that would provide migrants with legal representation, which can help them move faster through the bureaucracy.— Eileen SullivanThe Pentagon pivots to a possible war with China.After nearly 20 years of funding overseas combat through supplemental accounts, the Pentagon will now be paying for its wars in Iraq, Syria, Afghanistan and other countries through its overall budget of $715 billion in 2022.While the Army will see a small increase of funding for training Afghan security forces, its overall spending on combat operations will drop more than 21 percent to $18.4 billion.Biden’s 2022 BudgetA new year, a new budget: The 2022 fiscal year for the federal government begins on October 1, and President Biden has revealed what he’d like to spend, starting then. But any spending requires approval from both chambers of Congress.Ambitious total spending: President Biden would like the federal government to spend $6 trillion in the 2022 fiscal year, and for total spending to rise to $8.2 trillion by 2031. That would take the United States to its highest sustained levels of federal spending since World War II, while running deficits above $1.3 trillion through the next decade.Infrastructure plan: The budget outlines the president’s desired first year of investment in his American Jobs Plan, which seeks to fund improvements to roads, bridges, public transit and more with a total of $2.3 billion over eight years.Families plan: The budget also addresses the other major spending proposal Biden has already rolled out, his American Families Plan, aimed at bolstering the United States’ social safety net by expanding access to education, reducing the cost of child care and supporting women in the work force.Mandatory programs: As usual, mandatory spending on programs like Social Security, Medicaid and Medicare make up a significant portion of the proposed budget. They are growing as America’s population ages.Discretionary spending: Funding for the individual budgets of the agencies and programs under the executive branch would reach around $1.5 trillion in 2022, a 16 percent increase from the previous budget.How Biden would pay for it: The president would largely fund his agenda by raising taxes on corporations and high earners, which would begin to shrink budget deficits in the 2030s. Administration officials have said tax increases would fully offset the jobs and families plans over the course of 15 years, which the budget request backs up. In the meantime, the budget deficit would remain above $1.3 trillion each year.The armed services’ budget requests reflect the Biden administration’s shift away from fighting against insurgent groups and a renewed focus on preparing for conventional wars against countries equipped with similar ships and aircraft, with China as their priority.The naval services are placing bets on the need for new anti-ship missiles, including giving the Marine Corps the ability to launch attacks on enemy warships over the horizon from truck-mounted launchers on land. Instead of pursuing the 355-ship fleet envisioned by the previous administration, the new budget’s funding of eight new ships in 2022 will see an overall modest rise to 296 ships, even after the Navy decommissions a number of the earliest Littoral Combat Ships that have been plagued by mechanical problems.The Army, Navy and Air Force are all investing in hypersonic weapons — missiles with conventional explosive warheads that can fly at many times the speed of sound and hit targets at ranges previously only reachable by cruise missiles or nuclear ballistic missiles. In the wake of the United States leaving the Intermediate Nuclear Forces Treaty in August 2019, the Army is continuing the development of artillery rockets capable of ranges previously banned by that agreement.The Pentagon will be buying 48 more F-35 Joint Strike Fighters for the Air Force, and 37 for the Navy and Marine Corps.Military personnel will be receiving a 2.7 percent raise, and troop levels will remain relatively flat with slight reductions in all services save for the Air Force, which will increase its ranks by less than one percent.— John IsmayA reinvestment in diplomacy, democracy and refugees.Mr. Biden has stressed the value of restoring American diplomacy and alliances, and his budget requests an increase of $6.3 billion for the State Department and international programs, more than 11 percent above current levels — and almost 50 percent more than the last budget proposed by Mr. Trump, who repeatedly targeted the State Department for cuts.Prioritizing the threat of the coronavirus, the overall $63.6 billion request includes $1 billion in foreign aid to combat the spread of Covid-19, promote global health security programs and increase research to detect and stop future viral outbreaks.Programs supporting refugees and conflict victims would also grow: The budget asks for $10 billion in humanitarian assistance for vulnerable people overseas. And it would offer $861 million in assistance to Central American nations to help address the root causes of migration from those countries to America’s southern border.In response to growing cybersecurity threats and breaches, the budget asks $500 million for the Technology Modernization Fund, $110 million for the Cybersecurity and Infrastructure Security Agency and $750 million “to respond to lessons learned from the SolarWinds incident,” a massive intrusion into federal computer networks attributed to Russia.— Michael CrowleyAddressing violence against women and gender rights.The budget proposes giving the Justice Department the funding it needs to enforce key pieces of Mr. Biden’s domestic policy agenda on a range of issues that the previous administration did not prioritize, including enforcement of environmental laws, efforts to end gender abuse and initiatives to curb gun violence.The Justice Department’s Violence Against Women Act programs could get $1 billion, nearly double the 2021 amount, to fund existing programs and new initiatives that expand protections for transgender survivors of gender-based violence and support people of color who may not have had access to intervention and counseling resources in the past.The proposed budget also allocates $2.1 billion to address gun violence as a public health crisis, a number that is about 12 percent higher than in the previous year. — Katie BennerInvestments in high-poverty schools.The budget describes the need to address entrenched disparities in education as both a moral and economic imperative.It includes a $36.5 billion investment in high-poverty schools, a $20 billion increase from the previous year — which it describes as the largest year-over-year increase to the program, known as Title I, since it was created by President Lyndon B. Johnson.It includes $7.4 billion for the Child Care and Development Block Grant, an increase of $1.5 billion from the previous year, designed to expand access to quality, affordable child care.It also seeks to increase aid to early education programs, increasing the maximum Pell Grant by $400, the largest one-time increase since 2009.Mr. Biden is also expanding Head Start programs, which provide early intervention education and support for low-income students. The budget includes an $11.9 billion investment in the program, an increase of $1.2 billion. The coronavirus relief package also included an additional $1 billion for Head Start.— Annie KarniA renewed emphasis on protecting workers and job training.The budget provides a significant boost in funding for the Labor Department, including more money for the Occupational Safety and Health Administration, which is responsible for ensuring worker safety, and the Wage and Hour Division, which enforces fair labor laws. Mr. Biden is proposing a 14 percent increase to the Labor Department’s budget.OSHA was widely criticized during the pandemic for failing to do enough to protect workers at meatpacking and other plants where thousands of employees became infected. The agency has lost hundreds of inspectors in recent years, according to the National Employment Law Project, hindering its ability to conduct thorough inspections.— Glenn ThrushThe I.R.S. would get more money to catch tax cheats.For years, the budget of the Internal Revenue Service has been depleted as Republicans sought to starve it of resources in negotiations over appropriations.The Biden administration’s budget changes that, providing $13.2 billion to the tax collection agency so that it can ramp up enforcement activity. A well-staffed I.R.S. is central to the White House’s plan to shrink the “tax gap” and crack down on large companies and wealthy individuals who have avoided paying what they owe.The Treasury Department, which oversees the I.R.S., believes that an $80 billion investment in the I.R.S. over 10 years could yield $700 billion in additional tax revenue.On top of its usual tax collection duties, the I.R.S. has also been at the center of the Treasury Department’s economic relief effort. It has been responsible for distributing stimulus payments and will soon be making monthly payments of the child tax credit.Treasury Secretary Janet L. Yellen warned this week that her department, to which the budget allocates $15 billion, “cannot continue to be good stewards of this recovery” without sufficient resources.— Alan Rappeport

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