Reacting to new details out of President Biden’s proposed federal budget, Senate Democrats and a Trump-era economist warned the president’s fiscal plan isn’t going to work.
"I've been in this business for 35 years, and I would have to say this is a fiscal atrocity," best-selling author and former Trump administration economics adviser Steve Moore said on "Cavuto: Coast to Coast" Thursday. "It's probably the worst budget I've seen in terms of what its impact would be on the economy, it would be a killer."
After initially missing his February deadline, Biden is expected to tout budget policy details at an event in Philadelphia Thursday evening. The White House released information beforehand that the budget includes tax increases totaling $5.5 trillion and scraps oil and gas subsidies, FOX Business' Grady Trimble reported.
Tax reform details reveal a 25% billionaire tax on households making more than $100 million annually and an increase in the corporate tax rate from 21% to 28%. There’s also a capital gains tax raise to 39.6% from 20%, and a quadrupling of the corporate stock buyback tax.
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The proposals are unlikely to garner support in a deeply divided Congress and face almost certain rejection from Republicans who won control of the House last year.
"Start picking and choosing and trying to penalize, it's just not going to work. That's not going to fly," Sen. Joe Manchin, D-W.Va., told Trimble on Capitol Hill following the breaking news. "You cannot run this country if you're not energy secure. You can't be energy secure unless you're producing the oil, gas and coal that you need cleaner and better anywhere in the world."
"If the two houses were 100 Democrats and 435 Democrats, the president still would not get his budget passed," Sen. Tim Kaine, D-Va., also told Trimble. "The president submitting a budget is the jump ball that starts the basketball game, and the basketball game is between the House and the Senate."
The president’s budget applies to the fiscal year 2024, which begins in October. Under the new proposals, the U.S. would have "the highest tax rates in the world," according to Moore.
"This is sort of the blueprint for where progressive Democrats want to take the country. And I think it's really indicative that there's no cuts in here, that it's all tax and spend, tax and spend, tax and spend. It would be ruinous for the economy, and Republicans should be putting out in a completely different course from this," Moore argued.
Biden’s array of tax hikes leaves "a huge hole" in America’s economy, the Trump admin adviser continued to explain.
"You got to grow the economy. You got to get people working. You've got to get higher real wages for workers," Moore urged. "They're going to slow growth. We'll be lucky if we can grow it [by] 1.5% at these growth rates, and you're not going to be able to produce the revenues you need to make the program solvent… Biden being in office over the last two years has taken about $1 trillion out of the Medicare and Social Security trust funds because we don't have the number of people working, we don't have the wages and we don't have enough GDP."
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While timing remains uncertain, Moore predicts Biden’s fiscal policy will trigger a "financial crisis."
"We can't stay on this path of massive, out-of-control government spending and massive debt. I mean, point to a single country in the history of the world where this kind of economic strategy worked, because I can't find one."
FOX Business’ Megan Henney contributed to this report.
