President Biden’s multitrillion-dollar social welfare and climate change bill does not fully pay for all of its new entitlement programs, contrary to assertions long made by the White House.
An in-depth review of the bill, known as the Build Back Better Act, by the Congressional Budget Office indicates it adds more than $367 billion to the deficit over the next decade.
The CBO, a nonpartisan agency that analyzes federal legislation, says the deficit shrinks to $160 billion after taking into account Mr. Biden’s new tax enforcement procedures.
“CBO estimates that enacting this legislation would result in a net increase in the deficit totaling $367 billion over the 2022-2031 period, not counting any additional revenue that may be generated by additional funding for tax enforcement,” said CBO Director Phillip Swagel.
According to the CBO, the bill adds $791 billion to the deficit between 2022 and 2026.
Starting in 2027 the figure decreases as many of Mr. Biden’s biggest entitlement programs phase out and the Trump-era tax cuts expire.
The analysis contradicted Mr. Biden’s frequent boast that his plan for a historic expansion of the social safety net was “fully paid for.”
The CBO also found that several of the White House’s proposals for generating revenue to pay for the programs are unsound.
Specifically, Mr. Biden’s plan to hire 87,000 additional IRS agents to crack down on tax scofflaws is estimated to only raise $207 billion over the next decade. The figure is roughly half of the $400 billion the White House claimed it would be raised.
The analysis delivers a blow to Mr. Biden’s roughly $1.75 trillion social welfare and climate bill. Congressional Democrats hoped that by investing $80 billion in hiring more IRS agents they could narrow the gap between federal income taxes owed and the amount taxpayers actually fork over.
Such revelations shatter one of the main arguments Mr. Biden has used to sell the package to voters: mainly that it “costs zero dollars.”
“The CBO officially confirmed what Republicans already knew,” said Rep. Buddy Carter, Georgie Republican. “The [Build Back Better] agenda is not fully paid for … Democrats are trying to sell America on a socialist scam.”
The new report could prove a major political headache for Mr. Biden at a delicate time for his domestic agenda.
House Speaker Nancy Pelosi is planning to hold a vote on the bill before Congress departs Washington at the end of the week for a Thanksgiving holiday.
“Very soon, the American people will have a historic cause for celebration,” said Mrs. Pelosi, California Democrat. “Build Back Better is a spectacular vision. … It will create millions of good-paying jobs, lower families’ costs and cut their taxes while making the wealthiest few and big corporations pay their fair share.”
Several moderate House Democrats have made their support contingent upon the CBO’s analysis of the bill lining up with that of administration officials, however.
“I haven’t seen all of the CBO estimates so I’m not prepared to answer,” Rep. Stephanie Murphy, a Florida Democrat, said when asked about her support for the measure. “We are taking into account CBO scores before we vote on any bill … it’s the responsible thing to get the best, nonpartisan estimate we can on the bill.”
Given Democrats have a narrow majority in the House, Mrs. Pelosi can only afford to lose three members of her conference on any particular vote. At the moment, moderates are playing coy about how they plan to vote in light of the new data.
Even before the CBO’s results were official, congressional Democratic leaders and the White House rushed to discredit the agency. The arguments mostly focused on what Democrats viewed as an inability by the CBO to properly vet the bill.
“There’s wide agreement CBO doesn’t have experience analyzing revenue amounts gained from cracking down on wealthy tax cheats who are taking advantage of honest taxpayers,” said White House spokesman Andrew Bates.
Complicating matters is that Mrs. Pelosi contributed to the poor CBO results. Over the past month, House Democrats have been working feverishly to expand the package by reinserting programs — including a $213 billion paid family leave proposal and an expansion of the state and local tax (SALT) deduction — that had been sidelined by Mr. Biden.
The White House abandoned such provisions last month amid opposition from Senate Democrats.
Since the bill is moving via a budget reconciliation, which allows some spending measures to avert the Senate’s 60-vote filibuster threshold and pass by a simple majority, the upper chamber has what is akin to veto power.
“This bill is going to be wildly different from what the Senate ultimately may do,” said Rep. Fred Upton, Michigan Republican.
Correction: An earlier version of this story misspelled Mr. Swagel‘s first name.
