Op-Ed, The Washington Examiner: Chairman Arrington Sheds Light on President Biden’s Fiscal Vigilantes
WASHINGTON, D.C. – Last Friday, House Budget Committee Chairman Jodey Arrington (R-TX) penned an Op-Ed in the Washington Examiner highlighting the Biden Administration’s unilateral actions to expand big government, and further our nation’s fiscal burden – all to advance the White House’s political agenda.
Chairman Arrington Via the Washington Examiner:
Via Washington Examiner:
In 1983, Wall Street economist Ed Yardeni coined the term “bond market vigilantes” to describe traders who triggered a violent sell-off due to fears of rising interest rates caused by reckless spending, deficits, and debt.
Today, behind closed doors, it’s fiscal policy vigilantes who are weaponizing their arsenal of unilateral actions to swing the 2024 election and expand the size and scope of government in the process. It is the most insidious form of Bidenomics.
These vigilantes operate within the bureaucracy of the Biden administration. For example, after his demands that the Federal Reserve lower interest rates failed, President Joe Biden’s Treasury Department announced a plan to repurchase long-term debt. This move increased demand for these securities, suppressing interest rate yields and influencing borrowing costs across the economy.
Again, last fall, Treasury Secretary Janet Yellen executed a similar operation, issuing more debt on the short end of the yield curve. This had the effect of limiting the supply of longer-term bonds, driving up their prices, lowering their yields, and sparking a fourth-quarter market rally.
However, while both moves marginally reduce long-term interest rates, they will ultimately increase taxpayer costs because of the higher interest rates the Treasury must pay on shorter-term securities caused by the inverted yield curve.
These vigilantes’ reach extends well beyond the Treasury Department. Looking to boost employment with cheap labor, the Biden administration perpetuates open-border policies, flooding the economy with low-wage workers to fill jobs and try to ease inflation pressures. By some estimates, the number of illegal aliens in the U.S. had doubled since Biden took office from about 10 million to more than 20 million.
Many of these immigrants are working — legally or illegally. Some can officially join the labor force. For example, as of November 2023, there were 3 million asylum seekers who could become eligible for work visas after 180 days. And we know that many work in the underground economy. Either way, these individuals put significant downward pressure on wages.
The nonpartisan Congressional Budget Office agrees, stating in a February 2024 report: “Additional foreign nationals are expected to work in sectors of the economy that pay relatively low wages, thus putting downward pressure on average wages.”
Then, of course, there are the blatant giveaways intended to win electoral favor with key constituencies. The taxpayer largesse devoted to student loan forgiveness already totals a whopping $160 billion in spending since Biden took office. Unilaterally expanding food stamp payments through the “Thrifty Food Plan” adds another $300 billion.
The vigilantes have been particularly active in the healthcare space. They rewrote the qualifications for taxpayer-subsidized Obamacare plans,2 expanding the number of eligible people, even if they were already getting coverage from employers. The effects of these actions continue today to the tune of $34 billion over the next 10 years.
In the Medicaid program, the administration limited states’ abilities to perform eligibility and program integrity reviews, meaning more people who may very well be ineligible continue to put federal money in their pockets at a cost of $200 billion over 10 years, according to the CBO.
And just last week, the vigilantes finalized a regulation that, per the CBO, will spend more than $7 billion over the next 10 years to extend Obamacare subsidies for Deferred Action for Childhood Arrivals recipients.
Leveraging the bureaucracy for political and ideological purposes isn’t new for incumbent presidents. Whether these efforts will achieve their goals remains uncertain, as well as who will pay for all of it. However, the scale and impact of this generational theft require immediate scrutiny, at least as much as the hypotheticals surrounding future administrations.
The Bottom Line:
The Biden Administration’s approach to fiscal policy raises serious concerns about the trajectory of the U.S. economy and the burden it places on taxpayers. The actions of these fiscal policy vigilantes, operating within the bureaucracy, wield significant influence government spending, often at the expense of hardworking American taxpayers.
As Chairman Arrington highlights in this op-ed, restoring fiscal accountability starts with oversight of Biden’s overreaching executive actions. The repercussions of these policies extend far beyond the current Administration, and it will take political will and courage to safeguard the nation's economic future.
