Debt Package Slashes Childcare, Senior Nutrition, Housing Aid, Tuition Assistance While Also Damaging the Climate & Giving Free Pass to Wealthy Tax Evaders
House Republicans today voted to kick 100,000 kids off childcare, deny affordable housing to over a million families, take away healthy meals from a million older Americans and reduce Social Security services—among many other damaging service cuts—while making it easier for rich people to evade hundreds of billions of dollars of taxes every year. This vote is the latest example of the Republican economic agenda: protect the rich, hurt the rest.
After decades of championing massive tax giveaways to the wealthy and corporations, all of which increased public debt, the GOP keeps trying to pay for those handouts to the rich by cutting services crucial to working families.
Today’s legislation would also take away healthcare and food from millions of Americans by adding bureaucratic red tape designed to strip vulnerable families of their Medicaid and SNAP (Supplemental Nutrition Assistance Program) benefits; deepening the planet’s climate crisis by abolishing tax credits that make green technology more affordable; and making it harder for honest taxpayers to file their returns. On top of that, economists estimate that the bill could cost 780,000 Americans their jobs.
The $3.6 trillion of service cuts over 10 years contained in the bill—which passed 217-215, with all Democrats opposed and all but 4 Republicans in favor—are the price the GOP demands for raising the nation’s debt limit and preventing a catastrophic federal default. But even with all its drastic cuts and policy changes, the bill would merely defer the default crisis for less than a year, keeping alive the threat of a financial panic and steep recession.
“You’d think it would be hard to simultaneously hurt kids and seniors, damage the environment, give rich folks the green light to cheat on their taxes, and continue to threaten a worldwide economic panic—but somehow House Republicans crammed it all into one bill,” said David Kass, executive director of Americans for Tax Fairness. “It’s particularly disturbing because the better alternative is so clear: raise the debt limit immediately and without conditions, then attend to our nation’s longer-term needs with fairer taxes on the rich and corporations. President Biden has shown the way—now it’s time to follow his lead.”
The debt limit is an artificial barrier that periodically risks convulsing the international economy and throwing tens of millions out of work. Failure to raise the limit prevents the government from fulfilling financial obligations ranging from Social Security payments to veterans benefits to interest on the national debt. Only recently have Republicans begun using the debt limit to try to extract debilitating service cuts; in previous decades during both Democratic and Republican administrations the debt limit was routinely raised to ensure the government could pay its bills.
The GOP bill theoretically imposes cuts evenly across all spending that Congress votes on each year. But Republicans have indicated they intend to spare defense and veterans budgets, meaning deeper cuts for everything else: investments in services ranging from highways to housing to healthcare would be almost 60% below their currently forecast levels after 10 years.
The same Republicans holding the nation’s creditworthiness hostage out of a professed concern about national debt want to permanently extend Trump tax cuts that mostly benefit the wealthy and increase that debt by $3 trillion. Recent research shows the Trump tax cuts and an earlier round enacted by Republican president George W. Bush and a Republican Congress are the main cause of the growth over the past 20 years in public debt as a share of the economy.
President Biden and Congressional Democrats are offering a completely different approach. First, they would quickly end the unnecessary fiscal crisis by raising the debt limit without conditions. Then, they would address the twin issues of federal debt and underinvestment in American families and communities by raising taxes on the rich and corporations so they pay closer to their fair share.
Earlier this year, the president proposed a budget that would over 10 years reduce debt by $3 trillion while investing $2.8 trillion in services for working families, all paid for with $5 trillion in fairer taxes on the rich and corporations plus $800 billion in associated cost savings.