The People’s Budget is a comprehensive agenda of big and not-so-big ideas, which together form a powerful, coherent program for an economy and government that works for all Americans, not just the wealthy.
The People’s Budget would make major investments in creating good jobs, educating our children, stopping the disruption of our climate, changing the priorities in Pentagon spending, and restoring our democracy. It would pay for these and other public goods by turning our upside-down tax system right side up. In doing so, it would actually cut the federal budget deficit.
A core premise of the People’s Budget is that every American who wants to work should have a good job that allows them to care for and support their family. The budget aims to reach full employment and makes a $1 trillion investment in infrastructure in addition to financing for clean and renewable energy. It would also make essential investments in families, like universal pre-K, funding for every child eligible for Head Start, and building more affordable housing.
In addition to boosting wages through full employment, the People’s Budget calls for raising the minimum wage and the overtime threshold so companies can no longer avoid paying overtime to millions of workers. It would help working people care for loved ones and for themselves by guaranteeing paid sick days and by assisting states that establish insurance funds for paid family leave. And it would repeal the federal ban on Medicaid paying for abortions so that mothers who rely on that program for their health care can decide whether it’s the right time for them to have a child.
To help all our children and young people have a brighter future, the People’s Budget would build on its investment in Head Start and Pre-K by fully funding the law that establishes federal programs for K-12 education. It aims for debt-free higher education for today’s and tomorrow’s college students while reducing the cost of current student loans.
The People’s Budget also tackles the deep racial inequities in our criminal justice system. It would provide funding for public defenders and reduce prison sentences for non-violent crimes to help those first entering the system. And to put ex-offenders on a path to success, it would increase funding for housing, job training, medical care, education, and other re-entry programs.
Any responsible budget must tackle the biggest elephant in the room and the biggest portion by far of the budget: Pentagon spending. The People’s Budget would audit the Pentagon—the only federal agency that escapes accounting scrutiny. It would switch defense spending from outdated weapons—hundreds of billions spent only because of lobbying by Pentagon contractors—to modern security threats. But, mindful of its impact on workers, it would finance the transition from building bombers to bullet trains. And because America’s path to peace and security depends on peace and security around the world, the budget would increase spending on sustainable development, humanitarian assistance, and diplomacy.
Mindful that so much of our spending is driven by lobbyists and campaign cash, the People’s Budget would fund a small-donor matching system so candidates for Congress could compete for office without taking big money.
All that and more adds up to spending $3.4 trillion more over the next 10 years than we would under current law. Sound like a lot? Not when compared to how much revenue the People’s Budget would generate by rejecting the idea that raising taxes is unpopular. In fact, raising taxes on the wealthy and closing big corporate loopholes is hugely popular with everyone outside of the super-rich and corporate lobbyists.
By asking the wealthy and big corporations to stop shirking their responsibility to support the working families that create wealth and the public structures that enable businesses to operate, the People’s Budget would raise $8.8 trillion more than the budget that’s in place now. How? Corporations would not be able to dodge taxes by shipping their profits overseas. Too-big-to-fail banks would be taxed. A tiny tax on Wall Street trades would discourage speculation while raising $900 billion over 10 years. Corporations would no longer be able to write off multimillion-dollar CEO compensation.
The People’s Budget takes aim at climate change, too. Oil and gas companies would stop getting tax breaks for pulling more of their planet-destroying products out of the ground. A new tax on oil would finance modernizing our transportation system. More broadly, a tax on all carbon—with most of the proceeds going to investments in renewable energy—would power a 26 percent reduction in climate-destroying pollution. At the same time, families with low-incomes would be protected from the hike in oil and gas prices from taxing carbon.
The budget also asks those who make more to pay more. returning the income tax rate for the 2 percent of people making more than $250,000 a year to what it was under President Clinton. The budget would also lower the estate tax exemption to $2.5 million for an individual; while not exactly a daring proposal, this would still raise $231 billion.
To help families cover the basics and boost the economy, the People’s Budget would increase both the child care tax credit and the Earned Income Tax Credit (EITC) for workers who get paid low wages. As I’ve explained, these tax credits boost the economy by 40 percent more than corporate tax giveaways at one-third the cost. This is also why the People’s Budget would repeal the latest round of corporate tax breaks.
There’s a lot more: a public option and negotiation of drug prices to bring down the cost of health coverage. Comprehensive immigration reform. The full details, including specific budget line items, are here.
Having described all that, my only complaint about the People’s Budget is that it’s not bold enough. I would have spent a bunch of that new $5 trillion surplus on extending health coverage to many who remain uninsured and lowering the out-of-pocket costs in many health plans. I would have also made child care, not just pre-K, available at no cost to all working families.
Of course, the People’s Budget is a political statement with no chance of becoming law in the foreseeable future. But it’s a political statement in the best sense, a vision of how the federal government could use the power of the purse to create an American economy and democracy that works for all of us, not just the wealthy. Without that vision, we have no chance of ever getting there.
Cross-posted from Next New Deal