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President Joe Biden is proposing a tax hike to extend Medicare solvency and also calls for $2 trillion deficit reduction, Federal Reserve chairman warns job losses “very likely” in inflation battle, and more in Democrat politics.
This week, President Joe Biden proposed a 5 percent Medicare surtax on people who earn more than $400,000 a year as a way of extending the program’s solvency by another 25 years.
Thus far, key Democrats have declined to say whether they will back the proposal, while Republicans are slamming the plan as a “massive” tax hike, The Hill reported.
Biden’s proposal would raise taxes on those earning more than $400,000 annually to 5% from its current 3.8%, CBS reported.
When President Joe Biden unveils his budget on Thursday, those familiar with his plan say his administration is set to call for at least $2 trillion in deficit reduction, CNN reported. In addition, Biden is expected to advocate for raising taxes on the wealthy and corporations, among other deficit-reducing moves and programs. The proposal comes as Biden faces a showdown with House Republicans over the looming debt ceiling crisis.
Federal Reserve Chairman Jerome Powell on Tuesday testified before a Senate panel, stating that the central bank “still has work to do” and said interest rate hikes might need to be raised higher than policymakers had expected, CNBC reported.
“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Powell told the Senate Banking Committee, The Hill reported. “If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.”
Powell said all Americans are harmed by rising inflation, not only those who could potentially lose jobs as the economy slows while conceding that job losses are “very likely.”
On Wednesday, the Senate was expected to vote to pass a Republican-led resolution to block a controversial Washington, DC, crime bill that opponents have characterized as being weak on crime, CNN reported. Although the bill is GOP-lead, Democrats have also been divided. A large number of Democrats plan to support a resolution to rescind the bill after President Biden announced he would not veto it.
