A letter from the Congressional Budget Office in response to an investigation by a Republican congressman from Missouri confirms that the Biden administration’s executive actions will increase costs to federal taxpayers and fuel growing deficits.
Response to CBO Rep. Jason Smith highlights three major actions taken by the Biden administration — on food stamps, Affordable Care Act grants and student loans — and quantifies the cost associated with those actions .
In all three cases, the Biden administration took questionable administrative actions to advance its grand government agenda and a real cost to taxpayers.
The CBO letter revealed that Biden’s action on food stamps will increase the deficit by $250 billion to $300 billion over 10 years.
The Biden administration has increased food stamp benefits through an update to the Thrifty Food Plan, in which the Department of Agriculture analyzes a basket of foods intended to provide a nutritious diet. In its Thrifty Food Plan update, the USDA increased benefits by 23%, which it was previously thought would add more than $20 billion a year to the deficit. We now know that the annual cost will amount to $25-30 billion per year.
Although the 2018 Farm Bill directed the Food and Nutrition Service to update the Thrifty Food Plan by 2023 and every five years thereafter, each previous Thrifty Food Plan has not had no cost. In fact, when the CBO estimated the cost of the 2018 farm bill, it estimated the Thrifty Food Plan to be cost-neutral.
The Biden administration may have circumvented regulations and congressional authority to increase the overall cost of the program. Senate and House Republicans have asked the Government Accountability Office to investigate the legal authorities and process the USDA undertook to arrive at such an unprecedented increase.
The CBO examined the impact of the rule proposed by the Biden administration to change the parameters for determining eligibility for grants under Obamacare. The so-called family glitch rule would increase the deficit by $34 billion between 2023 and 2032, the CBO said.
The Biden administration is trying to use its proposed rule to increase the number of people receiving Obamacare subsidies by relaxing the current requirements so that those with employer-based coverage can qualify for the subsidies.
Under current law, people with access to employer-based coverage are not eligible for Obamacare subsidies. The exception to this limit is if the employee’s share of the bonus costs exceeds 9.5%.
The rule proposed by the Biden administration — which, it should be noted, was launched after Congress failed to pass a similar legislative change in the various Build Back Better proposals — attempts to expand this exception. to include dependents, despite legislative language referring to stand-alone coverage, rather than family coverage, to do the math.
There are a number of reasons why the proposed rule is both a reckless and legally questionable policy. Not only is he trying to rewrite the law through administrative action, but he would also shift private employer coverage for families in favor of government coverage and force taxpayers to foot the growing bill.
Rather than glossing over the root causes driving up health care premiums and costs, Congress and the administration should be looking for ways to make coverage more affordable.
No other segment of society enjoys the kind of special treatment that college graduates have received. More than two years after the first hit of COVID-19, student loan borrowers are still enjoying a “pause” from having to make repayments, at a significant cost to taxpayers.
Thanks to the new CBO report, we now know exactly how much that largesse costs. As the CBO explains, the cost of the break from February 2021 to August 2022 will be around $85 billion. This “pause” on refunds is far from free.
There is no reason to continue to offer this generous taxpayer subsidy to student borrowers. Statistically speaking, college graduates were more likely to work in jobs that allowed them to repay loans and work from home during the pandemic.
The break asked those without a degree — Americans more likely to work in frontline service industries, like restaurants and grocery stores — to subsidize this break for college graduates who might have had more job security and the ability to work remotely.
As Preston Cooper of the Equal Opportunity Research Foundation points out, 210 million American adults have no federal student debt, compared to 45 million who do.
The repayment “pauses,” and in particular the more generous loan forgiveness programs the Biden administration is preparing, reflect regressive policy approaches that punish people who have avoided debt – those with a college education, went to community college for two years before attending four-year college to cut costs, lived at home, or didn’t go to college at all.
From food stamps to health care subsidies to higher education, the Biden administration is redoubling its efforts on policies that would increase deficits while failing to meet the needs of children and families. The CBO’s most recent estimates show us just how costly these failed approaches will be.
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