Biden year one brings second-largest US budget deficit on record



The first year of Joe Biden's presidency resulted in the second-highest U.S. budget deficit on record, totaling $2.77 trillion for 2021. The deficit this year was still $360 billion lower than the all-time high record of $3.13 trillion reached in 2020, the final year of President Donald Trump's administration.

The astronomical deficits in both years follow trillions of dollars in government spending on COVID-19 pandemic relief and recovery.

In a statement Friday, the White House applauded the fact that the actual 2021 deficit was $897 billion less than the deficit forecast in Biden's 2022 budget and $342 billion less than estimated in the 2022 Mid-Session Review.

"Today's joint budget statement is further evidence that America's economy is in the midst of a recovery. The nation's economic progress is the direct result of the Biden-Harris Administration's efforts to enact the American Rescue Plan and address the pandemic," said Treasury Secretary Janet Yellen.

"These budget results are further proof that President Biden's economic plan is working," added OMB Acting Director Shalanda Young.

Both officials called on Congress to pass the rest of Biden's economic agenda this year, which includes a bipartisan $1 trillion infrastructure bill as well as a larger "human infrastructure" bill Democrats are negotiating in the Senate. Progressives wanted the larger bill to spend another $3.5 trillion, but Biden was forced to compromise with moderate Democrats somewhere closer to $2 trillion. Negotiations are ongoing and whatever the final cost of the bill will be, it was not included as part of the deficit report.

Biden's $2.77 trillion deficit for FY 2021 is more than double the pre-pandemic record of $1.4 trillion set in 2009, which was the result of President Barack Obama's stimulus package and other Democrat-led spending initiatives to recover from the 2008 financial crisis.

Excessive government spending under Obama's tenure became a rallying cry for Republicans, who promised to cut spending and balance the budget should they win office. But more than 12 years later, with Republicans having full control of the federal government between 2016 and 2018, budget deficits are higher than ever and the U.S. national debt is quickly approaching $29 trillion.

A joint report from the Treasury Department and the White House Office of Management and Budget said that federal spending increased 4.1% to $6.82 trillion in 2021. Increased spending was offset by an 18.3% increase in government revenue, which came from people returning to work and paying taxes.

The report said the increase in spending came from coronavirus relief legislation enacted by both Trump and Biden.

"Contributing to the dollar increase over FY 2020 were higher outlays for COVID relief programs such as Economic Impact Payments, State and Local Fiscal Recovery Funds, and the Emergency Rental Assistance Program," the budget report stated.

This year's budget deficit was equal to 12.4% of the gross domestic product, or the overall value of the economy, down from 15% of GDP in 2020.

House Republicans vote in secret to bring back pork-barrel spending



House Republicans voted Wednesday to end their conference-wide ban on earmarks, restoring GOP support for pork-barrel spending that directs money to pet projects in home districts.

The resolution was passed during the GOP's weekly conference meeting. The vote was 102-84 in favor of restoring earmarks and was conducted by secret ballot, so voters will not know which Republicans voted to bring back pork spending.

In 2010, House Republicans passed a moratorium on earmarks in their conference by voice vote, to show they were serious about cutting spending ahead of the midterm elections that year. Controversies like the wasteful $400 million "bridge to nowhere" in Alaska fueled Republican campaign promises decrying federal spending and promising reform.

After the 2010 Tea Party wave election handed the GOP control of the House and made Rep. John Boehner (R-Ohio) House speaker, Republicans pledged to hold a vote banning earmarks.

"Earmarks have become a symbol of a dysfunctional Congress and serve as a fuel line for the culture of spending that has dominated Washington for too long," GOP leaders said at the time.

But in recent years, earmark proponents have argued that the ban was a mistake and that the ability of legislators to trade their support for certain bills in exchange for earmarks in those bills is needed to move legislation through Congress.

With President Joe Biden advocating for big-budget items like a multi-trillion-dollar infrastructure bill, Republicans say they want more control over how that money is spent.

""There's a real concern about the administration directing where money goes. This doesn't add one more dollar. I think members here know ... about what should go in their district, not Biden," Republican House Leader Kevin McCarthy told reporters ahead of the conference vote.

Rep. Mike Rogers (R-Ala.) offered the resolution to end the GOP's self-imposed earmark ban. His proposal included several rules to increase transparency, including requirements for GOP lawmakers to publicly disclose the earmark, provide written justification for any project, and verify that they have no financial stake in it.

"I'm a yes," Rep. Fred Upton (R-Mich.) said. "With the changes with transparency — it's not the Upton Road to the Upton House, you have support in writing from local units of government — I think that's a fair approach."

Members of the House Freedom Caucus blasted their colleagues for supporting the return of pork spending, equating it to "legislative bribery."

"I think we've got $30 trillion in debt and people are tired of the swamp, and the GOP should be ashamed of itself, if it jumps headfirst right back into the swamp," Rep. Chip Roy (R-Texas) said.

Senate Republicans are considering a similar measure to restore earmarks, which is supported by retiring Sen. Richard Shelby (R-Ala.)