After President Biden’s American Rescue Plan resulted in record inflation levels and dramatically hindered the rate of job recovery after the pandemic, analysts have predicted Biden’s American Families Plan will add 21 million Americans to federal entitlement programs.
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Hoover Institution fellows John F. Cogan and Daniel Heil discussed their recent analysis in an article for the Wall Street Journal, they began, “The federal government’s system of entitlements is the largest money-shuffling machine in human history, and President Biden intends to make it a lot bigger.”
The analysts wrote, “For the first time in U.S. history—except possibly for the pandemic years 2020 and 2021, for which we don’t yet have data—more than half of working-age households would be on the entitlement rolls if the plan were enacted in its current form. Contrary to Mr. Biden’s assertion that his plan ‘doesn’t add a single penny to our deficits,’ his plan would add more than $1 trillion to the national debt over the next decade.”
The analysts point out, “These programs extend eligibility for benefits high up the income ladder. Two-parent households with two preschool-age children and incomes up to $130,000 would qualify for federal cash assistance for daycare. Single parents with two preschoolers and incomes up to $113,000 would qualify. And some families with incomes over $200,000 would be eligible for health insurance subsidies. Other parts of the plan, such as paid leave and free community college, have no income limits at all.”
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“Our analysis shows that the American Families Plan would add 21 million Americans to the list of federal entitlement beneficiaries,” they continued. “With these additional recipients, 57% of all married-couple children would receive federal entitlement benefits, and more than 80% of single-parent households would be on the entitlement rolls.”
Biden’s American Rescue Plan which was passed in March was similarly devastating to the economy, with inflation levels reaching a 13-year high in April, a record that was broken again in May. These levels have been more than double the highest projections made in a Bloomberg survey of economists.
Additionally, Biden’s economy underperformed by adding nearly 750,000 jobs less than expected in April, the month after the American Rescue Plan was passed. Forbes reported, “The United States added 266,000 jobs in April, according to data released by the Labor Department Friday—much worse than the 1 million job gains economists expected and far fewer than the 916,000 jobs added in March, indicating that the long-tepid labor market recovery is slowing down again even as stocks and corporate earnings rip higher.”
