Government Spending is the Foundation of “Bidenomics”
The Biden-Harris Administration considers the government foundational to economic growth and public spending the root of all jobs, income, and wealth creation.
The 2022 Economic Report of the President (ERP) specified that “a core aim of the Biden-Harris Administration’s economic policy agenda is to restore the public sector as a partner in long-run growth, with a particular focus on the economy’s supply side – from physical infrastructure to the vitality of the workforce.” In other words, the key goal of the Administration has been to grow the federal government. And they have done just that.
On virtually every metric that can be measured, the Biden-Harris Administration has successfully grown the size and scope of the federal government over the past four years.
The Result? Growing Debt, Higher Costs, Inflation, and More
After the pandemic spending surge in 2020, the annual rate of change in debt as a percent of the economy fell from its peak in April 2020 until April 2021. Since then, it has grown consistently. Between the first quarters of 2023 and 2024, debt held by the public grew from 92 to 97 percent of the economy.
Meanwhile, civilian government employees are at an all-time high. State and local government hiring has made up a disproportionately large part of the job creation since 2021 due to increased federal subsidies.
And new regulations finalized by the Biden-Harris Administration have cost the private sector $1.69 trillion and 312.1 million paperwork hours.
Despite its claims, the administration’s economic policy has increased costs, contributed to inflation, restricted barriers to entry, and hindered productive capital.
Political Initiatives Are Prioritized Over Economic Growth
On top of a flawed approach to basic economics, there is a pursuit of competing initiatives within the administration. These initiatives – aimed at holding a political coalition together rather than strengthening the U.S. economy – have spoiled top priorities of the administration.
One important example is the administration’s failure to expand rural broadband through the Broadband Equity Access and Deployment (BEAD) program. This program was central to the “Bidenomics” agenda. Congress appropriated $42.45 billion in 2021 to expand high-speed internet and in the summer of 2023 the Biden-Harris Administration awarded the state allocations. However, because of restrictions that the administration has placed on the awards, not one household has been connected to the internet using the BEAD funds as of September 2024.
Entrepreneurship, Competition, and Deregulation for A Better Way Forward
A better way forward would be to re-ground economic policy in areas with widespread public support. This would include pursuing full employment, low inflation, and sustainable economic growth.
Policymakers should look to American entrepreneurship as the catalyst of innovation that creates well-paying jobs and wealth. Policymakers should also encourage competition by ensuring open access to markets, with only essential safety regulations that remain neutral and do not favor specific businesses.
Furthermore, history reveals that deregulation can produce significant gains for consumers. Particularly, deregulation that enhances transparency will boost competition, resulting in lower prices and greater quality of goods and services for consumers.
