This increase is mainly due to the war in Ukraine, says correspondent Jan Postma. For example, $170 billion will go to new weapons and to replenish the stock of ammunition. “A lot is being exported to Ukraine, and major munitions factories are working overtime.”
In addition, $145 billion will go to the development of new weapons. “We mainly talk about China,” Postma points out. “The war in Ukraine is, of course, now top of mindbut America actually sees China as its biggest competitor and biggest long-term threat.”
China itself increased its defense budget by $210 billion. An arms race is brewing, thinks Postma. For example, he warns that China can build much faster than America. “Americans have to follow the rules and can’t just force people to work. The Chinese do it and they really see it as a danger.”
Rich Americans
To pay for this, wealthy Americans in particular have to pay more taxes. Those making $400,000 a year now pay 3.8% in taxes. This should be increased to 5%. “This is necessary, because he also wants enough money to be able to maintain Medicare, a program that gives people over the age of 65 access to treatment,” says Postma. Furthermore, she also wants to significantly reduce the budget deficit over the next ten years. “Everything has to come from somewhere.”
The presentation of the financial statements is in Philadelphia, Pennsylvania. According to Postma, this has everything to do with the upcoming presidential election. “He hasn’t announced yet whether he’ll run again, but he’s obviously doing some campaigning as well.”
Battlefield
Pennsylvania is one of the most important been a battlefield during the US elections. Disappointed Democrats who could no longer find jobs in factories voted for Trump in 2016. But Biden took this state in 2020, “so he wants to show that he’s fighting for that ordinary American.”
At the same time, Biden must also involve the Republicans in the House of Representatives, who have a majority there. “This is going to be a really long fight,” Postma says. Biden may want anything, but he needs those Republicans. And then here he is also fighting over the debt ceiling, which has been going on for months ».
There is an intention that there will be a deal on that cap in the summer, otherwise there will be no more borrowing. The question is whether both sides want to push it to the limit. “With that Biden budget presentation, the time also comes for Republicans to show what they stand for and what they want to cut. A lot of things are confusing and that makes things quite complicated.”