On Friday’s broadcast of CNBC’s “Squawk Box,” Deputy Treasury Secretary Wally Adeyemo responded to questions on whether the Biden administration would support increased spending if Democrats controlled Congress by stating that the deficit went down last year and we can reduce it again with things like “modest tax increases that would allow us to bring down our debts and deficits over time.” And that he’s focused on implementing current legislation.
Co-host Joe Kernen asked, “If you had, if the administration had friends in the House — in other words, if the Democrats still controlled the House — would you be okay proposing another x amount of — let’s say another trillion, 2 trillion on social programs or some type of outlay, whether — I don’t know, student loan…forgiveness, would you add another 2 or 3 trillion on, Wally, if you could, if you had the cooperation of the House and Congress?”
Adeyemo responded, “The thing I will mention is the deficit did come down dramatically last year. And I think that we can take steps to bring it down this year as well. The president’s proposed a set of plans that would do that, including modest tax increases that would allow us to bring down our debts and deficits over time. And I think that he would like to see Congress move forward on these proposals.”
Kernen then asked, “But would you spend more though? Would you propose an IRA 2 or — I don’t know, there’s no shortage of ideas as far as Democrats go on spending for — a lot of it’s I just think redistribution — but would you spend more?”
Adeyemo answered, “So, what I’m doing today is I’m working on implementation of the laws that have already passed like the Inflation Reduction Act. I do think that one of the things we need to think through is how do we make sure that, going forward, we have a package that allows us to continue to invest in America while also bringing in the revenues we need to bring down our debts and deficits. The president has a plan for doing that. He’s proposed a plan for increasing taxes modestly while making investments in the American people that will allow us to grow our economy, because, ultimately the thing that you and I both know is that, in order for the American economy to grow, we’ve got to make investments. Our businesses need to make investments…and what we’re seeing because of the Inflation Reduction Act is that, not only American companies, but companies around the world as I talk to their CEOs, they’re thinking about making investments in states like Ohio and in New York. And we’ve got to continue to incentivize that while also bringing in revenue by modestly increasing taxes on those who make more than $400,000.”
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