Biden’s big budget comes with a modest growth outlook for an ageing country
President Joe Biden’s first budget proposal comes with a big price tag – at $6 trillion, roughly 50% higher than pre-covid-19 federal spending – but, at least for now, projects a relatively modest long-term lift to the economy, likely reflecting concerns about the ageing U.S. population.
The administration’s spending blueprint for the fiscal year ending in September 2022 would increase spending on infrastructure, education and combating climate change, echoing familiar priorities for the first-term Democrat.
But it comes with forecasts for near-term growth that do not reflect the rapid improvement in the economy so far this year. With the help of $1.9 trillion in additional stimulus spending approved earlier this year, the economy grew at an annualized rate of 6.4% in the first quarter, a pace projections from both the Survey of Professional Forecasters and…