Larry Kudlow: Biden's $3 trillion fantasy about GOP intentions is a flat out lie

So, let’s begin this evening, with a flat-out, "there he goes, again." The "he" is President Biden. The "there he goes, again" is his phony assertions today about a $1.4 trillion deficit drop that he claims is the largest one-year decline in history.  Now, I'm going to be very careful here, because factually Mr. Biden has a point about the $1.4 trillion. I don't know about American history, but as usual, both his statement and the context is completely and fraudulently misleading. Why do I say that? Well, let me quote from Maya MacGuineas, president of the mainstream, committee for a responsible federal budget. It’s neither left nor right. It’s mainstream operations. It’s done very well. Ms. MacGuineas reminds us that the entirety of the decline in the deficit between 2021 and 2022 can be attributed to the expiration of temporary Covid relief — the emergency measures. 

She goes on to point out that the deficit actually would've been almost $400 billion lower had the Biden administration not decided to enact an inflationary, costly and regressive student debt cancellation plan back in August and then Ms.  MacGuineas adds, that despite claims of historic deficit reduction, lawmakers and the President have approved nearly $5 trillion of new borrowing over the last two years and then she goes on to suggest that the Federal Reserve is having a hard time getting inflation under control when fiscal policymakers keep making their job even harder with more borrowing. 

So, I didn't hear or read that Mr. Biden talked about the $5 trillion in new borrowing. Nor did I hear him acknowledge that it was Covid spending coming to an end rather than any Biden spending or deficit reduction actions and I have to add, that many republicans like Jason Smith and Kevin Brady have strongly argued that when counted properly for numerous gimmicks, the recently, fraudulently named IRA super-spending bill could actually spend up to $800 billion in renewable tax credits, not $400 billion.  Plus, phony baloney scoring of Medicare subsidies, totaling nearly $300 billion.  Plus, outside experts like Ms. MacGuineas and the Penn-Wharton model suggests the proper range for the student loan cancellation, which is really the have-nots subsidizing the haves, that range will be $500 billion to $1 trillion, not even CBO's $400 billion which itself was double the White House's roughly $200 billion.

US BUDGET DEFICIT CUT IN HALF TO $1.38T AS PANDEMIC SPENDING SLOWS DOWN

Alright, go back to March of 2021. Call that inflationary spending bill $2 trillion, then add another $1 trillion for the Green New Deal so-called "Infrastructure bill," then tack on Lord knows what else between the IRA and the student loan cancellations and I think Ms. MacGuineas' $5 trillion new borrowing estimate is just about right.  That's the number to focus on. As usual, President Biden cannot give America a serious, honest, straight, accounting estimate of anything and that is the character flaw I spoke of last night. It's just like him telling us that American oil companies, the greatest in the world, producing the cleanest energy, employing over 11 million blue-collar high-paying jobs. It's really they who are responsible for high energy prices.

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"They're sleeping," Biden said. What he did of course, is impugn one of our greatest, world leading, cutting edge industries with a flat out lie. He said he's done nothing to block fossil production and yet we have definitively shown he has done everything in his power to block fossil energy production. We are going to have more on that when we talk to the distinguished former Secretary of State Mike Pompeo and the equally distinguished former Energy Secretary Rick Perry, but back on the subject of Biden's spending and deficits. Let’s not forget, if Mr. Biden had his way, the original "Build Back Better" plan was a minimal $4 trillion of new spending. He just didn't get it and it had a massive tax hike that would've done even more damage to the American economy. That’s what he wanted, but during a brief shining moment, Senator Joe Manchin stood in the way. So much for brief shining moments.

One other fiscal point. In today's press conference, Mr. Biden keeps talking about a Republican plan that would add $3 trillion to the deficit. I don't know what he's talking about. This is an entirely made-up assertion. In fact, Kevin McCarthy and the House Republicans' policy guideline entitled "Commitment to America" explicitly talks about a strategy to rescind Biden's inflationary spending and borrowing, to rescind Biden's war against fossil fuel over-regulations and to rescind Biden's tax hikes and to rescind 87,000 new IRS agents. If they had their way, they would rescind the entire $5 trillion of Biden borrowing. So, this $3 trillion Biden fantasy about GOP intentions is just a flat out lie. That's the problem. That is his character flaw. That is why Americans have completely lost confidence in him and that is why in the mid-term elections on November 8th, voters are going to reject the idea that Mr. Biden’s the person to save our sinking ship. That’s right folks, the Cavalry's coming and with good reason. 

This article is adapted from Larry Kudlow's opening commentary on the October 21, 2022, edition of "Kudlow."