A letter from the Congressional Budget Office in response to an inquiry by a Republican congressman from Missouri confirms that the Biden administration’s executive actions will increase cost to federal taxpayers and fuel rising deficits.
The response to Rep. Jason Smith from the CBO highlights three major actions taken by the Biden administration—on food stamps, the Affordable Care Act (Obamacare) subsidies, and student loans—and quantifies the cost associated with those actions.
In all three cases, Biden’s administration has taken questionable administrative steps to advance its big government agenda. This is a real cost to taxpayers.
Food Stamps
CBO revealed in a letter that Biden’s actions on food stamps will increase deficit by between $250 billion and $300 billion over ten year.
Biden’s administration increased food Stamp benefits through an update of the Thrifty Food Plan. This is where the Department of Agriculture analyses a range of foods to ensure a nutritious diet. The USDA updated the Thrifty Food Plan and increased benefits by 23%. Previously, it was thought that the USDA would add more than $20 Billion per year to the deficit. We now know that the annual cost of living will be between $25 billion and $30 billion per year.
The 2018 farm bill directed the Food and Nutrition Service, among other things, to update the Thrifty Food Plan every five years by 2023. However, every previous Thrifty Food Plan was cost-neutral. The CBO actually estimated that the Thrifty Food Plan would cost neutral when it calculated the cost of the 2018 Farm Bill.
The Biden administration may not have followed regulations or used congressional authority to increase program costs. Senate and House RepublicansThe Government Accountability Office has been asked to investigate the legal authorities used by the USDA to achieve such an unprecedented increase.
Obamacare Subsidies
The CBO reviewed the impact of the Biden administration’s proposed rule to change the parameters for determining eligibility for subsidies under Obamacare. The so-called family glitch rule is proposed. increase the deficitThe CBO estimated that $34 billion would be spent between 2023-2032.
Biden’s administration wants to use its proposed rule in order to increase the number individuals who are eligible for Obamacare subsidies. It will do this by easing the requirements for people with employer-based coverage that they can qualify for the subsidies.
Current law does not allow individuals who have employer-based coverage to be eligible for Obamacare subsidies. The exception to that limitation is if the employee’s share of the premium costs exceeds 9.5%.
The Biden administration’s proposed rule—which it should be noted was initiated after Congress failed to enact a similar change legislatively in the various Build Back Better proposals—attempts to expand that exception to include dependents, despite the legislative language referencing self-only coverage, rather than family coverage, in forming the calculation.
There are several options. number of reasonsThis is why the proposed rule is not only unwise policy but also legally questionable. It attempts to rewrite the law via administrative action. It would also displace private, employer based coverage for families in favour of government coverage, and force taxpayers onto the growing bill.
Congress and the Administration should not try to hide the root causes of rising premiums and high health care costs. to make coverage more affordable.
Student Loans
No other group of society receives the same special treatment that college graduates get. More than two years after COVID-19 first hit, student-loan borrowers are still enjoying a “pause” on having to make repayments, at a significant expense to taxpayers.
The new CBO report reveals how much this largesse actually costs. The CBO estimates that the cost of the pause between February 2021 and August 2022 will amount to $85 billion. This “pause” on repayments is far from free.
There’s no reason to continue providing this generous taxpayer subsidy to student-loan borrowers. Statistics show that college graduates were more likely than others to find work that would allow them to repay their loans, and to work remotely during the pandemic.
The pause asked those without degrees—Americans more likely to work in frontline service industries, such as restaurants and grocery stores—to subsidize this pause for college graduates who may have had more job security and the ability to work remotely.
As the Foundation for Research on Equal Opportunity’s Preston Cooper points out, 210 million adult Americans do not have federal student-loan debt, compared with the 45 million who do. Repayment “pauses,” and especially the more generous loan-forgiveness schemes the Biden administration is cooking up, reflect regressive policy approaches that punish those individuals who avoided debt—those who worked their way through college, went to community college for two years before attending a four-year college to reduce costs, lived at home, or didn’t go to college at all.
Biden administration doubles down on policies that increase deficits, while failing to meet the needs children and families. The CBO’s most recent estimates show us just how costly those failed approaches will be.
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