The White House released on Thursday a framework for the Build Back Better agenda—a massive, $1.75 trillion spending bill that will radically transform the American way of life as we know it—and Democrats in Congress are intent on rapidly moving it immediately. We asked analysts from The Heritage Foundation to examine what is in the bill text. We will update their responses as they come in:
An important reform included in the Tax Cuts and Jobs Act was to cap the SALT deduction at $10,000. The SALT deduction subsidizes high taxes imposed by state and local governments. The primary beneficiary of the SALT deduction is high-income taxpayers in high-tax states. Prior to the cap being put in place, the average millionaire from New York or California deducted more than $450,000 per year of SALT, while the average Texas millionaire only deducted about $50,000 resulting in a federal tax liability nearly $180,000 higher than their high-tax state counterparts.
Restoring subsidies for high income taxpayers in high tax states has been a priority for some blue-state lawmakers that have said “No SALT, no deal”. There have been reports that Speaker Nancy Pelosi, D-Calif., and Rep, Richard Neal, D-Mass., chairman of the Ways and Means Committee, “have given NJ/NY Democrats assurance it will be in bill.”
Instead of this harmful proposal, Congress should finish the job and repeal the SALT deduction.
Biden’s framework would spend $40 billion to increase the maximum Pell Grant award by $550, send additional subsidies to historically black colleges and universities and minority-serving institutions, and provide additional funding for community colleges and workforce development.
These additional federal subsidies will only encourage schools to raise prices, shifting more of the burden of paying for higher education from the student who benefits to all taxpayers.
Colleges will have received an additional $76 billion in federal spending over the past year and a half in response to COVID-19—a monumental sum nearly equivalent to the Department of Education’s entire annual discretionary budget. This plan would add tens of billions more.
Colleges have needed a course-correction for decades, and new federal subsidies will continue to enable general fiscal maladministration, avoiding necessary structural reforms, and changes at the university level that would actually reduce college costs.
For example, from 2001 to 2011, the number of non-teaching employees and administrators increased 50% faster than teaching faculty. Non-instructional staff now accounts for more than half of university payroll costs.
Ever-increasing college costs fueled in part by federal subsidies have muddied colleges’ value proposition. Across the country, tuition and fees for in-state students attending four-year universities have nearly tripled in real terms since 1990. Since 1970, inflation-adjusted tuition rates have quintupled at both public and private colleges.
Federal subsidies have increased dramatically, with spending on student loans rising 328 percent over the last 30 years, from $20.4 billion during the 1989-90 school year to $87.5 billion during the 2019-20 school year. As University of Ohio economist Richard Vedder explains:
[I]t takes more resources today to educate a postsecondary student than a generation ago… Relative to other sectors of the economy, universities are becoming less efficient, less productive, and, consequently, more costly.
This spending package, by adding another $40 billion in federal subsidies, will only continue this trend, fueling increases in higher education costs while shifting more of the burden onto taxpayers.
– Lindsey Burke is the director of The Heritage Foundation’s Center for Education Policy and the Mark A. Kolokotrones fellow in Education.
The Biden administration has turned the U.S. immigration system into immigration chaos, and now the left wants American taxpayers to pay for it. The Democrats will continue to try to ram through amnesty using budget tricks. This will effectively reward illegal immigrants and will fuel the surge we are seeing play out every day at our southern border.
The Biden administration has itself to blame for inflating the backlog of immigration benefit applications. When they continue to add hundreds of thousands of illegal aliens to the application line, those who followed the law and apply for legitimate benefits are forced to wait years longer to have their application adjudicated.
What’s more, immigration benefits are fee-based. This is sound fiscal policy as applicants, not taxpayers, should pay for their own benefit application. To force U.S. taxpayers to pay for the Biden administration’s own backlog punishes Americans, fails to hold the administration accountable for their open border policies, and hurts lawful immigrants, their family members, and employers.
“Expanding legal representation” is a euphemism for taxpayer-funded attorneys for deportable aliens. Aliens already have a right to counsel in (civil) immigration proceedings, but at no expense to the government. The left has sought to chip away at this sound fiscal policy for decades, starting with illegal alien minors.
Requiring taxpayers to fund attorneys would be a fiscal bottomless pit, given the unknown millions of illegal aliens already in the country, plus the unending flow of illegal aliens currently crossing the border, plus the years’ long immigration court backlogs.
Furthermore, it would treat deportable aliens better than U.S. citizens, who do not have a right to taxpayer-funded attorneys in civil proceedings.
The left continues to ruin our asylum system while calling it “efficient and humane.” Asylum is intended to protect those who suffered or have a well-founded fear of persecution based on their race, religion, nationality, political opinion, or membership in a particular social group. Yet the left shoe horns in general violence, crime, and climate change into membership in a particular social group and labels them asylees.
Those conditions do not meet the definition for asylum and such applicants are not eligible. Watering down asylum to declare every applicant eligible hurts those who truly faced or fear real persecution. This is chaotic and inhumane.
– Lora Ries is the director of The Heritage Foundation’s Center for Technology Policy and a senior research fellow focused on homeland security at Heritage’s Davis Institute for National Security and Foreign Policy
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