Biden’s Deficit Shrinking Claim Fails Fact Check
After his first year in office, President Biden doesn’t have much to brag about. That’s especially true when it comes to the economy. So much so that he’s reached into his bag of political tricks and pulled out an old one. He’s trying to make himself look better by fudging facts.
The latest fact-fudging comes in the form of claims his policies are successfully reducing the U.S. government’s budget deficit. But as CNN’s Daniel Dale reports, while the numbers are accurate, his claims of success in reducing the deficit rely on distorting the truth.
President Joe Biden has been taking credit for reducing the federal budget deficit, the annual gap between the money the government takes in and the money the government spends.
“Let me remind you again: I reduced the federal deficit,” Biden said in a speech on Wednesday. “All the talk about the deficit from my Republican friends, I love it. I’ve reduced it $350 billion in my first year in office. And we’re on track to reduce it, by the end of September, by another 1 trillion, 500 billion dollars—the largest drop ever.”
Biden’s figures for both the 2021 fiscal year (which ran through last September) and the ongoing 2022 fiscal year (which runs through the coming September) are accurate, though the $1.5 trillion figure for 2022 is a projection. But some experts on fiscal policy say Biden is distorting reality when he claims that he is personally responsible for the deficit going down.
The deficit has been smaller under the Biden administration than it was at the end of President Donald Trump’s tenure. But the deficit has been bigger under the Biden administration than the nonpartisan federal Congressional Budget Office had projected it would be if the Biden-era federal government stuck with the laws that were in effect when Trump left office in early 2021.
It’s possible to determine if President Biden’s claim of success in shrinking the budget deficit is true. We need to compare the government’s actual deficits to what they would be if none of his fiscal policies were ever implemented.
That’s why the CBO’s February 2021’s budget projections are important. They provide a good estimate of how big the deficit would be without any impact from President Biden’s fiscal policies. We can use these estimates to evaluate how much true success President Biden has had in shrinking the deficit.
I’ve done that in the chart below for President Biden’s first year in office. It compares President Biden’s actual budget deficit for the government’s 2021 fiscal year with the CBO’s projection. I’ve compared both these figures with the federal government’s actual budget deficit for its 2020 fiscal year.
The U.S. government’s budget deficit would have been much smaller had President Biden’s fiscal policies never been implemented. President Biden’s budget deficit was $360 billion smaller than the 2020 fiscal year’s deficit, which had exploded because of the coronavirus pandemic. But without President Biden’s new spending, the deficit was on track to shrink by at least $874 billion.
It Could Have Been Even Better
With many states lifting their COVID lockdowns in 2021, the U.S. economy recovered more quickly than the CBO had forecast. The U.S. government took in $540 billion more in revenue than the CBO projected once these economic shackles were removed.
Had President Biden not increased the government’s total spending by $1.054 trillion, the budget deficit could have shrank by $1.414 trillion. That would truly have been a remarkable deficit shrinking success.
But he didn’t. President Biden’s claims of success depend on nobody paying close attention to what he’s saying. Because if they do, once they see through the sham, they cannot unsee it.