$3.5 Trillion for the Build Back Better Agenda Is Much, Much Less Money Than You Think By Jon Schwarz The Intercept,Octoberr5, 20205, 2020

 

$3.5 Trillion for the Build Back Better Agenda Is Much, Much Less Money Than You Think 

This big, scary-sounding number represents just 1.2 percent of U.S. GDP over the next 10 years.

Photo illustration: Elise Swain/The Intercept; Photos: Getty Images

IF THERE’S ONE thing the corporate media has told us about the Democratic Party’s proposed Build Back Better agenda — the major initiative of the Biden administration, featuring significant investments in education, welfare, and more — it’s that it involves $3.5 trillion.

Left out of the coverage, though, is one key issue: How much money is that, really?

$3.5 trillion certainly sounds like a lot. Human brains aren’t equipped to understand numbers of this magnitude; in our regular lives, we never encounter 3.5 trillion of anything, let alone actual dollars.

But the reality is surprisingly modest: $3.5 trillion is just 1.2 percent of the U.S. economy over the relevant time frame.

The fact that the media has resolutely failed to provide this context is an act of true malfeasance. It contributes to public ignorance in general and supports the right’s favorite narrative of wild liberal profligacy. If the Build Back Better plan fails, or is significantly reduced in scope, the media’s behavior will be a big reason why.

To start with, the $3.5 trillion represents a combination of new spending and tax cuts that would take place over 10 years. There are many examples of coverage that literally never mention this, even in higher-quality news outlets. When the Senate moved forward with the agenda in early August, NPR reported it had “narrowly endorsed a $3.5 trillion budget resolution early Wednesday morning in a 50-49 party-line vote.” The 10-year time period appeared nowhere in the piece.

Later in the month, the New York Times ran an article with the headline, “House Passes $3.5 Trillion Budget Plan for Vast Expansion of Safety Net.” Like NPR, the Times never mentioned that this was $3.5 trillion over a decade.

The same basic fact is missing here (New York Times), here (New York Times), here (Washington Post), here (Washington Post), here (Washington Post), here (Wall Street Journal), here (Wall Street Journal), and almost uniformly on television.

But even more egregiously, the corporate media has failed to explain how much $3.5 trillion is in comparison to the most relevant metric, the size of the U.S. economy. The significance of this should be obvious: After all, $1,000 is a real expense if you make $10,000 a year, but not if you make $1 million.

No one can say exactly how big the U.S. economy will be over the next decade, but the Congressional Budget Office projects that the cumulative gross domestic product of the United States during the 10 years from 2022 to 2031 will be $288 trillion. The $3.5 trillion Build Back Better agenda is therefore just 1.2 percent of GDP.

There appear to be no examples of this number appearing in corporate news coverage. Even members of the Democratic caucus in Congress almost uniformly fail to mention this — with the notable exception of Sen. Bernie Sanders, I-Vt., who noted recently on CNN: “We’re talking about close to $300 trillion [in GDP] over the next 10 years. This is 3 1/2 trillion, barely more than 1 percent of that.”

The media could also usefully compare the size of the Build Back Better bills to current government spending. The CBO projects that the federal government will spend $63.4 trillion from 2022-31. Because the $3.5 trillion in Build Back Better proposals includes both spending and tax cuts, and the mix is not finalized, it’s difficult to say precisely how much the agenda would increase government outlays. But if Congress were to pass a bill that included $2.5 trillion in additional spending over the next 10 years, that would represent about a 4 percent rise in federal expenditures.

This should make clear how much easier the media has made it for opponents of the Build Back Better agenda to fearmonger about its size. Of course, opponents of the Build Back Better proposals could still legitimately oppose it based on a philosophical objection to any new nonmilitary spending. But it’s much more difficult to object when everyone’s hearing the nonscary-sounding “1.2 percent of GDP” number rather than the huge, terrifying “$3.5 trillion.”

And this barely scratches the surface of how badly the corporate press has bungled this subject. The $3.5 trillion proposals would not increase the federal debt by anywhere near that amount, because the Democrats are proposing significant tax increases. In The New Republic, Michael Tomasky explains what should be an obvious point: The agenda should be thought of not as money we’ll never see again, but as investments that will come back to us in the form of a much better, healthier, better-educated America. Most importantly, modern monetary theory persuasively suggests that the constraint on spending is not how many dollars Congress has, since the government can print however many it wants, but whether the spending generates inflation. And the Build Back Better proposals are specifically designed to increase the productive capacity of the U.S. economy, lessening inflationary pressures.

All in all, it’s been a grim performance by the media, aided and abetted by the Democrats, who seem to have no understanding of how to communicate with normal Americans. The fact that the Build Back Better agenda may survive despite this, at least in some form, demonstrates just how popular it is.

Build Back Better Costs Much Less Than You Think (theintercept.com) 

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