Dems using ‘gimmicks’ to hide spending

​The US Chamber of Commerce has accused Democrats of using accounting “gimmicks” to hide more than $1 trillion ​​​in spending in President Biden’s Build Back Better social spending bill, and cautioned lawmakers against voting on the package without knowing its “true cost.”

“We have the highest inflation in 31 years, employers are struggling to fill a record number of job openings, and the current draft of the reconciliation bill uses gimmicks to cover up well over $1 trillion in spending,” Chamber Executive Vice President and Chief Policy Officer Neil Bradley​ said in a statement Wednesday.

“It would be the height of irresponsibility for Members of Congress to vote on this multi-trillion-dollar tax-and-spend bill with no clear understanding of its true cost or the real-world impact of the policies,” he added.

The House passed a bipartisan Senate-approved $1.2 trillion infrastructure deal last week, but the $1.75 trillion spending package is being held up ​in the House while Democratic members await an analysis of its costs by the nonpartisan Congressional Budget Office.

Chamber Executive Vice President and Chief Policy Officer Neil Bradley
Neil Bradley was the Chamber’s Chief Policy Officer, Vice President for Executive Affairs and Head of Communications.

The Chamber’s letter, which was sent to every member of Congress, noted that the Build Back Better legislation includes provisions that could be extended by a future Congress, significantly adding to the bill’s potential cost down the road.

“As currently drafted, the reconciliation bill would expand or create new entitlement programs and refundable tax credits, but then sunsets many of these programs – in some cases after just one year – to disguise the true cost of the bill​,” the letter said.

“​Given that the bill’s proponents clearly intend for these programs to continue past their sunset, lawmakers should be provided with a Congressional Budget Office estimate of the true cost of the bill if these programs were permanent​,” it continues.

Chamber cites universal childcare and preschool as the problem programs. They also mention an extended version of the child credit that will expire in 2027. Next year, the Chamber plans to end the expanded version. The Chamber also cites the reduced premiums Americans pay for health care via the Affordable Care Act-managed marketplaces. The provision expires in 2025.

“Experts at the Penn Wharton School at the University of Pennsylvania have estimated that if these programs were made permanent, the actual cost of the spending included in the bill would be $4.1 trillion,” the letter warned.

A graph comparing White House cost estimates with economists' estimates.
The letter claims that the bill “sunsets” policies to disguise their true cost. The White House estimates have been compared to those of Penn-Wharton experts.

The Chamber went on to complain that other parts of the bill “front-load spending in the early part of the ten-year window” laid out by lawmakers.

“For example, over $20 billion is provided for workforce training and related education programs, but most of that money is only available through 2026,” the letter said. “A true accounting of the bill’s cost requires identifying which provisions are intended to be permanent and calculating the cost without any arbitrary sunset.”

It was also requested that the Chamber be more transparent about how this bill will affect inflation and workers shortages.

“Today, a labor shortage crisis is one of the biggest factors holding back an economic recovery. Even small companies report unusual difficulties in filling available positions. Yet, there is no analysis of how the reconciliation bill would impact labor force participation,” it said.

“Some provisions, like childcare assistance, could, if structured correctly and not arbitrarily sunset, increase workforce participation while other provisions that increase transfer payments without requiring that recipients work will dampen participation,” the letter said. 

Over objections by moderate House Democrats and Sens, Democrats tried to lower the bill’s size from the initial $3.5 trillion. Joe Manchin (D-WV), and Kyrsten Silena (D-Ariz.). Many Democrats expressed their hope that American citizens would accept the programs, and push Congress to make the programs permanent. 

The CBO on Wednesday released reports on four parts of the bill – contributed by the House Homeland Security, Science, Small Business, and Veterans Affairs committees – that it said “would not increase on-budget deficits after 2031,” but it has also noted that a full report will take more time.

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