In private conversations over the past several weeks, aides to President Biden have discussed proposing new taxes on the wealthy this year to help fund Social Security benefits as the presidential election looms, according to two people familiar with the matter, who spoke on the condition of anonymity to describe internal deliberations.
With former president Donald Trump again vowing to protect Social Security if elected, some advisers to Biden’s team believe pushing to bolster the program’s finances could help highlight the contrast between Democrats and Republicans on economic policy, even though such a plan would have no chance of passing Congress. But the plan would require Biden to expand his proposed tax increases, although they would not affect people earning under $400,000 per year, the people said.
The discussions over whether Biden should unveil a plan to shore up Social Security, previously unreported, reflects a growing effort by the Democratic Party’s leading economic thinkers to craft a populist message to counter Trump, who appears likely to win the GOP nomination easily and head into the general election with a substantial lead among voters on pocketbook issues.
Biden’s advisers have also homed in on the campaign’s likely top issues in the presidential race, with prescription drugs, taxes and corporate price-gouging emerging at the forefront of those discussions. Economic policymakers and former administration officials have participated in informal talks, including Brian Deese, who served as director of the White House National Economic Council; Bharat Ramamurti, who served as Deese’s deputy in the White House; Martha Gimbel, who served as a top Biden economist; Michael Linden, a former top Biden budget official; and Arindrajit Dube, an economist at the University of Massachusetts, among others, the people familiar with internal matters said.
Biden’s advisers say the president’s campaign message will emerge more clearly after the upcoming State of the Union address and subsequent White House budget proposal, both of which are expected in March. Already, however, the Biden campaign and White House officials are beginning to wrestle with the tension between emphasizing his first-term accomplishments and identifying new goals to achieve in his second term, while voters remain unhappy with the state of the U.S. economy even though it’s shown surprising resilience and strength.
“They’re trying to figure out the second-term agenda conversation — one of the big questions here is how much are you looking forward, and how much are you looking backwards,” said one outside adviser briefed on the internal talks. “Yes, the actions he’s taken have to be a big part of the pitch. But for the voters who may have moved off of Biden, what are you going to do to tell them to give us four more years because we have more to do?”
Recent polling suggests the campaign has its work cut out for it. About half of likely voters said that if Biden won, his policies would make them worse off financially, while the same share said Trump’s policies would make them better off, according to a CBS News/YouGov poll conducted Jan. 10-12.
“It’s really important, with these kinds of numbers, that the president clearly lay out exactly how his policies will make voters better over the next four years, and that requires picking a populist economic message,” said Celinda Lake, a Democratic pollster who worked for Biden in 2020.
While their focus could change over the course of the campaign, Biden’s advisers have preliminarily eyed three key policy initiatives — reining in prescription drug prices; taxing large corporations and billionaires; and an aggressive attack on corporate price-gouging — as particularly fertile opportunities to attack Trump. These are enticing political messages in part because Biden has already enjoyed partial success in all three areas, and he’s proposing additional plans to go further — giving voters a reason to keep him in office.
Internally, Biden aides see their efforts to cap some prescription drugs as perhaps their most potent political message, with large majorities of voters supporting aggressive action against pharmaceutical companies. Biden officials have also contemplated how to push the private market to similarly cap prices — extending the benefits to more Americans, not just those covered by Medicare — setting up a further contrast with most Republican lawmakers.
A debate over tax policy offers similar advantages. Biden approved a new 15 percent minimum tax on corporate profits as part of the Inflation Reduction Act, but he can highlight his additional proposal to tax billionaires — including Trump — as unfinished business. With trillions of dollars from the 2017 Trump tax cuts set to expire, taxes also represent an active policy fight with Republicans on Capitol Hill, and large majorities of voters believe that tax law was slanted toward the rich and wealthy.
The third big policy message for Biden’s team is likely to center on its work on corporate price-gouging and hidden “junk fees.” On Wednesday, the Consumer Financial Protection Bureau unveiled a Biden administration plan to cap overdraft fees, sparking opposition from the banking industry, following other regulatory moves to limit auto dealer markups, create price transparency at Live Nation and Ticketmaster, and crack down on hidden airline fees. But the courts have stymied some of Biden’s efforts on this front, and corporate profit margins remain higher than their pre-covid levels. Trump took the opposite approach as president, cultivating a more deferential regulatory approach with business groups even as he feuded with corporate America on social and environmental policy.
“President Biden is fighting to keep building an economy centered on the middle class – not rich special interests,” White House spokesman Andrew Bates said in a statement. “American families deserve more historic progress lowering drug costs, a fairer tax code that rewards work instead of wealth, and the elimination of junk fees that cheat them.”
And yet for all the populist promise of some of his economic policy initiatives, the president still enters the year with significant disadvantages. Voters continue to disapprove of his handling of the economy, following the worst inflation in four decades that remains persistently top-of-mind for voters.
“He was so dismissive of inflation early on, and that has really hurt him even though inflation has come down,” said Frank Luntz, a pollster and political analyst. “Even if you can make a strong argument for the economy improving, he gets no credit for it partially because of his rejection of the stress people faced early on.”
Still, with inflation falling, Democrats are now eagerly eyeing a potential turnaround in economic sentiment — one that they could then couple with their proactive policy message.
“Tell folks how you’ll give them even more economic security if you have four more years. That’s the job he has now,” said Lindsay Owens, executive director of the Groundwork Collaborative, a left-leaning think tank. “If sentiment is trending upwards, then that’s a wonderful opportunity to offer a vision for what even more economic security looks like in four more years.”