Biden's budget complicates coming debt fight: expert

STORY: Biden ran in 2020 on putting money in people's pockets and rebuilding the middle class, and the U.S. federal deficit wasn't on a long list of campaign promises. But in his fiscal year 2024 budget, cutting nearly $3 trillion from the deficit over a decade is a topline goal, the White House says.

To accomplish that, Biden wants to raise taxes on companies and top earners - while also increasing spending in some areas.

Maya MacGuineas, president of the bi-partisan Committee for a Responsible Federal Budget, says that could complicate a coming fight with Republicans over the need to raise the U.S. debt ceiling.

She said “I think there is a limit on how much taxes are going to go up. There's one party that's very open to raising taxes on the very wealthy (Democratic Party) -- those making millions and billions -- and there's another party (Republican Party) that is very dug in on not raising taxes. So, realistically, thinking about something like a $6 trillion tax increase - and I know trillions kind of lose their meaning - but that's really big. That is a non-starter in the political environment in which we are.

"I think it's not the budget that makes this one different. It's the year that we're in. There are a lot of things going on. First, we have a really perilous fiscal situation, following the years of COVID, where we borrowed --as we should have --but we added trillions of dollars to the to the fiscal situation, to the overall national debt."

“And then finally, we have the whole debt ceiling drama that is unfolding this year, where a number of Republicans in the House have said they are not voting to increase the debt ceiling unless there is some level of savings in their mind, which should come from spending cuts. And that's something we've seen in many years past where the debt ceiling was lifted at the same time that packages of savings or budget process reforms were also included, so it's not a unreasonable ask, but it does mean that the unfolding of the budget process this year is particularly important , where we need to move the budgets along very quickly, and we need hopefully to get both parties talking to other each other very quickly about where they could compromise and generate some savings to bring the deficit and debt down."