Senate Republicans' anti-tax argument accidentally proves strength of Biden's economy

Senate Republicans have spent the last two years claiming that President Joe Biden was destroying the economy. But in a tweet Thursday, they seemed to undermine their entire argument.

“In 2022, the government collected $4.9 TRILLION in taxes,” the official Senate Republicans Twitter account posted to its feed. “That’s a 21% increase from 2021, and the largest increase in the last 50 YEARS. Now is NOT the time to raise taxes on the American people.”

This appeared to be based on a Congressional Budget Office report published on Nov. 8 that noted federal revenue had risen from $4.046 trillion in fiscal year 2021 to $4.896 trillion in FY 2022.

The report attributed the growth in revenue to the growing economy.

“Income taxes withheld from workers’ paychecks rose by $233 billion (or 16 percent). That increase probably reflects higher total wages and salaries, particularly among workers with relatively high incomes who face higher tax rates,” the CBO said.

The nonpartisan agency also noted a $323 billion increase in nonwithheld payments of income and payroll taxes: “The rise is probably attributable, among other factors, to increases in business and other nonwage income, including realizations of capital gains accruing to individual taxpayers.”

The U.S. economy saw a huge increase in job creation in 2022: To date, the nation has gained 12.4 million jobs since Biden took office in January 2021.

“It is remarkable to see Republicans trying to spin the success of the U.S. economy under President Biden and Democratic leadership as some kind of negative,” Rep. Don Beyer (D-VA), the top House Democratic member of the Joint Economic Committee, told the American Independent Foundation in an email:

The nonpartisan Congressional Budget Office said the increase in revenue above the historic average in 2022 likely ‘reflects higher total wages and salaries.’ The policies we passed helped drive record job gains and economic growth, and that naturally leads to higher incomes and tax receipts. Republicans have made it clear that they will fight tooth and nail to lower taxes on billionaires – and indeed are willing to massively expand the federal deficit to do so – but this is cynical even for them.

Senate Republicans frequently say the national debt is too high and must be brought down. But they have also opposed any tax increases to do that, repeating variations of the mantra, “We don’t have a revenue problem, we have a spending problem.”

A June 2021 report by ProPublica found that the wealthiest Americans paid little in taxes. Thanks to loopholes, it said, the true tax rate for several billionaires was lower than that paid by working families.

Biden proposed a budget plan on Thursday that he says would reduce the budget deficit by $2.9 trillion over the next 10 years without raising taxes on anyone earning under $400,000 annually. It would increase taxes for large corporations and households worth more than $100 million.

Senate Republicans are already rejecting the plan.

“President Biden’s misguided, bloated budget request would subject American families to more taxes, waste, and government intrusion that they do not deserve during the continued challenging economic times that define this administration,” said West Virginia Sen. Shelley Moore Capito on Friday.

“We must cut spending and lower taxes,” Tennessee Sen. Marsha Blackburn tweeted, adding later, “Families must balance a budget, so why doesn’t the federal government?”

Meanwhile, congressional Republicans have sought to roll back provisions in the 2022 Inflation Reduction Act intended to ensure that big businesses and wealthy Americans pay what they already owe in taxes each year.

The Republican majority passed along party lines its first 2023 bill on Jan. 9, one that would eliminate funding in the law for the Internal Revenue Service to better enforce tax laws and collect billions of dollars in unpaid taxes from people earning more than $400,000 annually and from large corporations. Biden has promised to veto the bill should it pass in the Democratic-controlled Senate.

Published with permission of The American Independent Foundation.