    [House Hearing, 117 Congress]
    [From the U.S. Government Publishing Office]

                    THE PRESIDENT'S FISCAL YEAR 2023 BUDGET

    =======================================================================

                                    HEARING

                                   before the

                            COMMITTEE ON THE BUDGET
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED SEVENTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                HEARING HELD IN WASHINGTON, D.C., MARCH 29, 2022

                                   __________

                                Serial No. 117-8

                                   __________

               Printed for the use of the Committee on the Budget

     [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                           Available on the Internet:
                                www.govinfo.gov

                               ______

                 U.S. GOVERNMENT PUBLISHING OFFICE
     47-496                WASHINGTON : 2022

                            COMMITTEE ON THE BUDGET

                      JOHN A. YARMUTH, Kentucky, Chairman
    HAKEEM S. JEFFRIES, New York         JASON SMITH, Missouri,
    BRIAN HIGGINS, New York                Ranking Member
    BRENDAN F. BOYLE, Pennsylvania,      TRENT KELLY, Mississippi
      Vice Chairman                      TOM McCLINTOCK, California
    LLOYD DOGGETT, Texas                 GLENN GROTHMAN, Wisconsin
    DAVID E. PRICE, North Carolina       LLOYD SMUCKER, Pennsylvania
    JANICE D. SCHAKOWSKY, Illinois       CHRIS JACOBS, New York
    DANIEL T. KILDEE, Michigan           MICHAEL BURGESS, Texas
    JOSEPH D. MORELLE, New York          BUDDY CARTER, Georgia
    STEVEN HORSFORD, Nevada              BEN CLINE, Virginia
    BARBARA LEE, California              LAUREN BOEBERT, Colorado
    JUDY CHU, California                 BYRON DONALDS, Florida
    STACEY E. PLASKETT, Virgin Islands   RANDY FEENSTRA, Iowa
    JENNIFER WEXTON, Virginia            BOB GOOD, Virginia
    ROBERT C. ``BOBBY'' SCOTT, Virginia  ASHLEY HINSON, Iowa
    SHEILA JACKSON LEE, Texas            JAY OBERNOLTE, California
    JIM COOPER, Tennessee                MIKE CAREY, Ohio
    ALBIO SIRES, New Jersey
    SCOTT H. PETERS, California
    SETH MOULTON, Massachusetts
    PRAMILA JAYAPAL, Washington

                               Professional Staff

                         Diana Meredith, Staff Director
                      Mark Roman, Minority Staff Director
                                    CONTENTS

                                                                       Page
    Hearing held in Washington, D.C., March 29, 2022.................     1

        Hon. John A. Yarmuth, Chairman, Committee on the Budget......     1
            Prepared statement of....................................     4
        Hon. Jason Smith, Ranking Member, Committee on the Budget....     6
            Prepared statement of....................................     8
        Hon. Shalanda Young, Director, Office of Management and
          Budget (OMB)...............................................    11
            Prepared statement of....................................    13
        Hon. Sheila Jackson Lee, Member, Committee on the Budget,
          report submitted for the record............................    58
        Questions submitted for the record...........................    70
        Answers submitted for the record.............................    75

                    THE PRESIDENT'S FISCAL YEAR 2023 BUDGET

                                  ----------

                            TUESDAY, MARCH 29, 2022

                               House of Representatives
                                        Committee on the Budget
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 10:06 a.m., at
    210 Cannon Building, Hon. John A. Yarmuth [Chairman of the
    Committee] presiding.
        Present: Representatives Yarmuth, Jeffries, Higgins, Boyle,
    Price, Schakowsky, Kildee, Morelle, Horsford, Wexton, Scott,
    Jackson Lee, Cooper, Sires, Moulton, Jayapal; Smith, Kelly,
    McClintock, Grothman, Smucker, Burgess, Carter, Cline, Boebert,
    Donalds, Feenstra, Good, Hinson, Obernolte, and Carey.
        Chairman Yarmuth. This hearing will come to order.
        Good morning and welcome to the Budget Committee's hearing
    on ``The President's Fiscal Year 2023 Budget''. At the outset,
    I ask unanimous consent that the Chair be authorized to declare
    a recess at any time.
        Without objection, so ordered.
        I will start by going over a few housekeeping matters.
    Today the Committee is holding a hybrid hearing. Members may
    participate remotely or in person. For individuals
    participating remotely, the chair or staff designated by the
    chair may mute a participant's microphone when the participant
    is not under recognition for the purpose of eliminating
    inadvertent background noise. If you are participating remotely
    and are experiencing connectivity issues, please contact staff
    immediately so those issues can be resolved.
        Members participating in the hearing room or on the remote
    platform are responsible for unmuting themselves when they seek
    recognition. We are not permitted to unmute Members unless they
    explicitly request assistance. If you are participating
    remotely and I notice that you have not unmuted yourself, I
    will ask if you would like staff to unmute you. If you indicate
    approval by nodding, staff will unmute your microphone. They
    will not unmute your microphone under any other conditions.
        I would like to remind Members participating remotely in
    this proceeding to keep your camera on at all times, even if
    you are not under recognition by the Chair. Members may not
    participate in more than one committee proceeding
    simultaneously. If you are on the remote platform and choose to
    participate in a different proceeding, please turn your camera
    off.
        Finally, we have established an email inbox for submitting
    documents before and during Committee proceedings and we have
    distributed that email address to your staff.
        Now, I will introduce our witness.
        This morning we will be hearing from the Honorable Shalanda
    Young, Director of the Office of Management and Budget. And per
    our agreement with Director Young, the Committee will recess
    briefly around noon and reconvene around 12:30 p.m.
        I now yield myself five minutes for an opening statement.
        Good morning, Director Young. I want to thank you for
    appearing before our Committee today to testify on the
    President's Fiscal Year 2023 Budget. I also want to
    congratulate you on your historic confirmation. We are honored
    to have you with us here today, and OMB is very lucky to have
    you at the helm.
        This month marked two years since the World Health
    Organization declared COVID-19 a pandemic. Since then, our
    nation experienced the worst economic downturn since the Great
    Depression. Families have lost their homes, their savings,
    their livelihoods, and their loved ones.
        When President Biden took office, the pace of vaccine
    distribution was dismal. There was no comprehensive plan to get
    shots into arms, there was an enormous gulf between what
    families and our economy needed and how the federal government
    was responding.
        That changed with the American Rescue Plan, which this
    Committee was proud to lead. It kick-started a mass vaccination
    campaign, reinvigorated our economy, and lifted millions of
    Americans out of poverty. Since the passage of the American
    Rescue Plan, the speed and strength of our recovery has blown
    past economists' expectations. 2021 was the greatest year of
    job growth in American history. During President Biden's first
    year in office, GDP grew at the fastest rate in nearly four
    decades. Unemployment has fallen to 3.8 percent, the fastest
    decline in recorded history. And the resurgence in worker power
    has led to wage increases across the board, with wages for low-
    income workers up the most.
        The President's budget request for 2023 takes the next
    steps toward achieving our shared goals. It provides a
    discretionary top line of nearly $1.6 trillion for annually
    funded programs, building on the enacted 2022 appropriations
    and continuing to reverse years of chronic underfunding. Its
    fiscally responsible and pro-growth investments in education,
    affordable housing, research and development, healthcare, and
    other vital priorities will not only better the lives of
    Americans today but strengthen our long-term economic outlook
    as well.
        This budget will expand the productive capacity of our
    economy and put money back in the pockets of the working
    Americans who power it.
        It will lower costs by fixing supply chains and increasing
    the amount of goods made here in America. It will cut energy
    costs for families while investing in climate science and
    innovation so we can tackle the climate crisis and lead in the
    clean energy economy. It will increase Pell Grants and provide
    more training and apprenticeships, so all Americans have the
    opportunity to succeed in a 21st century economy.
        The President's Budget is also a call to action on key
    areas of bipartisan consensus: tackling the mental health
    crisis, upholding our sacred obligation to our veterans,
    fighting the opioid epidemic, and investing in cutting edge
    research to end cancer as we know it.
        We can afford to invest in the American people. Rather than
    handing out tax cuts to millionaires and billionaires, the
    Biden Administration has outlined a new economic vision for
    America: invest in America, educate the next generation of
    Americans, grow our work force, and build the economy from the
    bottom up and middle out.
        This is how we meet the needs of families and communities.
    This is how we strengthen our recovery and grow our economy so
    that we build a better, stronger, more secure, and more
    inclusive nation for generations to come.
        And we pay for this new economic vision with long-overdue
    reforms to make our tax code more equitable. This starts with
    making sure corporations and the richest Americans pay their
    fair share in taxes. The Biden budget raises the corporate tax
    rate to 28 percent, which, by the way, is still much lower than
    the 35 percent tax rate we had up until 2017. It is completely
    unacceptable that hard-working families often pay a higher tax
    rate than the wealthiest Americans. The President's budget
    fixes this by proposing a 20 percent minimum income tax on the
    very wealthiest households worth more than $100 million.
    Together, these proposals will help re-balance our tax code to
    ensure it rewards work, not wealth.
        I am optimistic that we can get this done. As we continue
    to work with our colleagues in the Senate to deliver a
    reconciliation bill to the President's desk, I am eager to get
    to work on a 2023 budget and appropriations process that will
    deliver for the American people.
        Director Young, I look forward to your testimony today and
    hearing more from other Administration officials in the coming
    weeks.
        Now I yield five minutes to the Ranking Member, Mr. Smith,
    for his opening statement.
        [The prepared statement of Chairman Yarmuth follows:]

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        Mr. Smith. Thank you, Mr. Chairman.
        Director Young, welcome back in person to the House Budget
    Committee, and congratulations on your confirmation. It was way
    overdue. And congratulations on your new child. A lot has
    happened in a year. So, we are grateful you are here.
        When you testified last year on President Biden's Fiscal
    Year 1922 budget, alarm bells were already going off about the
    impact that the President's agenda would have on the economy,
    what it would have on the inflation, and the security of our
    southern border.
        At that time, the crises created by President Biden and the
    House and Senate Democrats' agenda were already piling up. That
    list has only grown since--including an energy crisis, with
    folks paying over $4.00 a gallon at the pump. In fact, since
    President Biden has been in office gas prices has went up 79
    percent. That is tough for the folks back home. Then there is a
    crime crisis in communities across this country, and an
    education crisis that has perpetuated the mistreatment of kids
    in our schools under the guise of COVID-19.
        So now we have President Biden's Fiscal Year 1923 budget, a
    proposal that deliberately makes every crisis American families
    are facing because of President Biden and the one party
    Democrat rule in Congress that much worse. American families
    are facing a spike in prices not seen in this country in over
    40 years. A $3,500 inflation tax on every family in America
    just last year alone. The President's budget keeps--keeps the
    reckless spending going on, doubling down on the delusion that
    the answer out of inflation is to spend more money. This
    proposal spends $73 trillion dollars over the next 10 years.
    And also it provides the Build Back Broke agenda which this
    budget tries to cover up using a deficit neutral reserve fund.
    The Congressional Budget Office though has confirmed there is
    nothing--nothing deficit neutral about the agenda. CBO
    confirmed it adds $3 trillion to our nation's debt.
        As gas prices have skyrocketed, the President's budget
    surrenders American energy independence and attacks American
    energy companies so that we are more reliant on foreign nations
    for our energy needs--more dependent on countries like Russia,
    China, and Venezuela, Iran, at a time when the world seems to
    be even more of a hostile place.
        This budget also includes potentially up to $4 trillion in
    tax increases, more than $1.5 trillion of that falling on
    American families. $2,000 for every average American tax
    increase is in this proposal. That--that is absolutely
    terrible.
        Then, under the Build Back Better agenda you have covered
    up in a deficit neutral reserve fund. Over the next 10 years
    Biden's budget calls for $58 trillion in total taxes--the
    highest sustained tax burden in American history. And while
    folks see their taxes go up and the value of their paychecks go
    down, Biden's budget gives a 12 percent raise to the IRS to
    target hard-working Americans.
        We already know where this type of tax and spending agenda
    is going. Look at the past year after the Democrats $2 trillion
    Biden Bailout Bill was signed into law. Jobs in 2021 grew less
    than CBO said they would before that $2 trillion spending bill
    came on the scene.
        After over 2.9 million border encounters occurred since
    Biden took office, the President's budget continues the same
    catch and release policies that have resulted in the worst
    border crisis in over 20 years. There is no commitment to
    border security in this budget, no using the $1.9 billion in
    border wall funding that was just renewed as part of the most
    recent omnibus spending bill. The budget allows $350 million in
    border wall still to continue rusting away while contractors
    are paid billions to babysit unused material. It cuts funding
    for Immigration and Customs Enforcement by $150 million. All of
    it is a slap in the face to the men and women dealing with a
    security and humanitarian crisis at the southern border. The
    President says show me your budget and I will tell you what you
    value. For the second straight year we see the President values
    a government that tells its citizens how to live their lives,
    he values an economy where everything from the clothes you put
    on your back to the food you put on your table to the gas in
    your car is more expensive. He values open borders and energy
    dependence. He values debt--a lot of it--$16 trillion to be
    exact.
        The American people are not going to buy this budget--
    because frankly we can't afford it.
        I yield back, Mr. Chairman.
        [The prepared statement of Jason Smith follows:]

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         Chairman Yarmuth. I thank the Ranking Member for his
    opening statement.
        In the interest of time I ask that any other Members who
    wish to make a statement submit their written statements for
    the record to the email inbox we established for receiving
    documents before and during Committee proceedings. We have
    distributed that email address to your staff. I will hold the
    record open until the end of the day to accommodate those
    Members who may not yet have prepared written statements.
        Once again, I want to thank Director Young for being here
    this morning. The Committee has received your written statement
    and it will be made part of the formal hearing record.
        You will have five minutes to give your oral remarks and
    you may begin when you are ready.

    STATEMENT OF THE HONORABLE SHALANDA YOUNG, DIRECTOR, OFFICE OF
                      MANAGEMENT AND BUDGET (OMB)

        Ms. Young. Thank you so much, Chairman Yarmuth, Ranking
    Member Smith, Members of the Committee. It is so nice to be
    back to my old place of employment. Thank you for the
    opportunity to present the President's Fiscal Year 2023 budget.
        Under the President's leadership our country has made
    historic progress in the face of unprecedented challenges. We
    created more than 6.5 million jobs in 2021, the most our
    country has recorded in a single year ever. Our economy grew at
    5.7 percent, the strongest growth in nearly 40 years. The
    unemployment rate has fallen to 3.8 percent, the fastest
    decline in recorded history. And the deficit is on track to
    drop by more than $1.3 trillion, the largest ever 1-year
    decline.
        This progress was not on accident. It is a direct result of
    this President's strategy to combat the pandemic and grow our
    economy from the bottom up and the middle out. The President's
    2023 budget details his vision to expand on that progress and
    deliver the agenda he laid out in his State of the Union, to
    build a better America, reduce the deficit, reduce costs for
    families, and grow the economy from the bottom up and the
    middle out.
        Since taking office the President has put forth proposals
    to Congress that would lower healthcare, child care, energy
    costs, and other costs for families, reduce the deficit, and
    expand our economy's productive capacity. The budget reflects
    his commitment to working with Congress to pass legislation
    that achieves those goals. This budget advances a bipartisan
    unity agenda, including proposals to combat the opioid
    epidemic, tackle the mental health crisis, support our
    veterans, and accelerate progress against cancer. It builds on
    the bipartisan funding bill Congress passed earlier this month,
    it makes key investments in the American people. From expanding
    economic capacity and improving our public health
    infrastructure to combatting the climate crisis and advancing
    equity, dignity, and security for all Americans.
        And during what will be a decisive decade for the world,
    the budget strengthens our military and leverages America's
    renewed strength at home so our nation is prepared to meet
    pressing global challenges and manage crises as they arise.
        With robust investments in our diplomatic and development
    agencies, the national security budget as a whole will deepen
    partnerships and alliances and position the United States to
    compete with China and any other nation from a position of
    strength. As we have seen over the past month, our renewed
    partnerships and alliances have been vital to countering
    Russian aggression in Europe. And I would like to thank
    Congress for the supplemental funding to support Ukraine and
    our regional partners.
        The budget makes these investments in a fiscally
    responsible way, reducing deficits by more than $1 trillion and
    improving our country's long-term outlook. That is because the
    budget's investments are more than fully paid for through tax
    reforms that corporations and the wealthiest Americans pay
    their fair share. That includes a new proposal requiring the
    richest Americans, billionaires and those worth more than $100
    million, to pay a tax rate of at least 20 percent on all their
    income, including investment income that currently goes
    untaxed. The budget also fulfills the President's promise that
    no one earning less than $400,000 will see a penny of new taxes
    and it will reduce the deficits to less than half of last
    year's levels as a share of economy while keeping the economic
    burden of debt low.
        Overall, the budget puts forward an economically and
    fiscally responsible path forward, addressing our country's
    long-term fiscal challenges while making smart investments that
    will produce stronger growth and broadly share prosperity for
    generations to come.
        Thank you for the opportunity to appear today and I look
    forward to your questions.
        [The prepared statement of Shalanda Young follows:]

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        Chairman Yarmuth. Thank you very much, Director Young, for
    your opening remarks.
        We will now begin our question and answer session.
        As a reminder, Members can submit written questions to be
    answered later in writing. Those questions and responses will
    be made part of the formal hearing record. Any Members who wish
    to submit questions for the record may do so by sending them
    electronically to the email inbox we have established within
    seven days of the hearing.
        I defer my questioning to the end, so I now recognize the
    gentleman from North Carolina, Mr. Price, for five minutes.
        Mr. Price. Thank you, Mr. Chairman, and welcome to our
    Director, Shalanda Young. We are very proud of the work you are
    doing, very impressed by your presentation here. Those of us
    who worked with you on the Appropriations Committee have a
    special pride and satisfaction in the job you are doing. So
    congratulations. We are glad to see you and we are also glad to
    see the President's budget.
        As the Chairman of the Transportation-HUD Subcommittee, we
    will look forward to early hearings with Secretaries Fudge and
    Buttigieg and we will, of course, as usual, look at every line
    of this budget proposal with care. We like what see so far
    though, I must say. The Department of Housing and Urban
    Development has a 9.5 percent increase, much needed. We can use
    it very wisely I think to address homelessness and housing
    costs, to expand and improve the housing stock. And we intend,
    as you do, to focus throughout on safety, on equity, on climate
    resiliency, and energy efficiency.
        The transportation side of the budget, also looks good.
    That is a 2 percent increase. It is building in good ways on
    the Infrastructure Investment and Jobs Act with a particular
    emphasis on transit and passenger rail.
        And so we look forward to scrutinizing this budget and
    moving forward to put it before the House at an early point.
        This morning I want to concentrate on another hat I wear
    and a program that I have been concerned about for my entire
    career and that I think is very important for us to focus on at
    this juncture, and that is national service, AmeriCorps--senior
    AmeriCorps and regular AmeriCorps. The budget has a $1.34
    billion item for AmeriCorps. That is an increase over $1.15
    billion in the current year. It also follows a historic $1
    billion investment in the American Rescue Plan, which as you
    know helped AmeriCorps respond to the pandemic, diversify its
    work force. There was a lot that we were able to achieve there
    with that additional funding. We increased AmeriCorps'
    diversity and its equity efforts, we increased the living
    allowances of Members, and we enabled some redeployment to go
    on with respect to pandemic needs.
        Now, what is the Administration's plan going forward? That
    is my question. We of course want to sustain these roles that
    have been taken on during the pandemic. Is this money
    sufficient to do that to sustain the increases that we have had
    during the pandemic period? And what is your vision for
    national service moving forward? The other element in this of
    course is the proposed Civilian Climate Corps, which has yet to
    be enacted by us. It was enacted by the House, has yet to be
    enacted by the full Congress. But I am interested in what you
    envision here. What role the Civilian Climate Corps plays in
    the budget, and what kind of potential this has to not just
    augment AmeriCorps, but give it a stronger focus on
    conservation and on community resilience?
        So what is the future of AmeriCorps in the Administration's
    view and how is it reflected in this budget?
        Ms. Young. Mr. Price--I would like to call you Chairman
    Price. He was my first Chairman. I worked for him on the
    Appropriations Committee.
        One, I want to thank you for your work on AmeriCorps, also
    National HDP, the House Democracy Partnership. Mr. Price likes
    to focus his attention on programs that bring out the best
    value of Americans. And I want to thank you for your focus. I
    did a service project with the new head of AmeriCorps on Martin
    Luther King Day. I want you to know our commitment to
    AmeriCorps is strong. And I think one of the things budgets of
    past administrations would do, look at past legislation that
    was passed, like the billion in ARP and reduce the budgeted
    amount, ensure retraction. We are not doing that. We are
    building on top of the Rescue Plan funding that was provided.
    As you mentioned, we are providing $1.3 billion here, $189
    million increase compared to the enacted level--so an
    expansion. It would allow AmeriCorps increase the member living
    allowance and volunteer stipends. It would also support
    increases in higher education awards for AmeriCorps volunteers.
    That aligns with the President's Pell Grant increase. The
    budget also includes $20 million for staffing at AmeriCorps to
    implement the Civilian Climate Corps that you mentioned. And
    that would be in partnership with the Department of Labor and
    Department of Interior in USDA.
        Mr. Price. Thank you. I do think the Civilian Climate Corps
    is a powerful idea and I am glad you are assuming that it is
    fully enacted and that you will have these costs accounted for
    in this budget.
        And I also think as we deliberate on this budget, and this
    bridges two or three subcommittees, we do need to pay attention
    not just to the full strength of AmeriCorps, but also how it is
    organized, and particularly how this Climate Corps is fully
    integrated into AmeriCorps operations.
        So thank you for that and we will look forward to working
    with you on that.
        Chairman Yarmuth. The gentleman's time has expired.
        I now yield 10 minutes to the Ranking Member.
        Mr. Smith. Thank you, Mr. Chairman.
        Director, inflation is at a 40-year high--7.9 percent in
    the year-to-year report from February. Fed Chairman Powell has
    now said that when it comes to calling the inflation crisis
    transitory, which the Administration has done repeatedly, he
    says ``I think it's probably a good time to retire that word''.
    I could not agree more.
        Have you spoken with the President about what can be done
    to solve the inflation crisis?
        Ms. Young. Ranking Member Smith, we absolutely talk about
    inflation along with economic growth, wage growth. We have to
    make sure that as we grow the economy. As you heard talked
    about we grew the economy the largest rate in 40 years. We also
    have to take in account with that came higher levels of
    inflation.
        Mr. Smith. So, it is very concerning. I am glad that you
    have spoken to the President about inflation. What is
    concerning is this budget proposal projects starting today that
    inflation will be at 2 percent for the next 10 years. Because
    the first year you say 4.7 percent, but already for the year it
    is over 8 percent. So, it would have to be 2 percent every
    month for the rest of the year to meet those averages, plus 2
    percent for the next nine years. Completely unrealistic when we
    are probably going to hit double digits inflation.
        So, to hit the inflation projections in this budget, it is
    just--it is madness. What policies in this budget brings it
    down were inflation will be at 2 percent?
        Ms. Young. Mr. Smith, I am happy to walk you through how we
    do calculation for the budget. These numbers were locked in
    early November. At the time we were in line with blue chip
    private forecasters. But inflation is clearly at a level----
        Mr. Smith. So, five months--Director, five months ago you
    locked in these inflation numbers. So, you did 4.7 percent five
    months ago and two weeks ago it came out at 7.9 percent. You
    guys were off by almost double in that 5-month span. I just
    want to know what policies do you all have in this proposal,
    because spending $73 trillion just seems like it is only going
    to fuel the inflation fire.
        So, I would like to know how you are going to help the
    people of Southern Missouri to be able to afford food on their
    table, clothes on their backs, and gasoline in their cars.
        Ms. Young. Yes, I am sure you have paid close attention to
    the President's plan on dealing with competition in the private
    sector and also improving supply chain challenges, which are
    global in nature. I would also point out that inflation is a
    global trend. Almost every developed country is seeing
    inflationary growth. What that tells us is that we have a
    global issue. It is not one bill, one country, specific
    policies. This is something all major countries are facing
    coming out of the pandemic.
        Mr. Smith. So, I would be curious, does the President
    believe spending $73 trillion over the next 10 years will
    reduce inflation or increase inflation?
        Ms. Young. The President believes the fiscally responsible
    thing to do is to pay for our proposals. That is why you see
    this budget bring down deficits over the 10-year period by over
    a trillion dollars.
        Mr. Smith. Well, Director, this proposal over the next 10
    years actually increases the national debt by $16 trillion,
    which is going to have more than a trillion dollar deficit
    every year for the next 10 years, which is the highest
    sustained amount of deficit in the history of our nation. And
    you are saying that this proposal is bringing down the
    deficits?
        Ms. Young. Ranking Member, I know we all know that deficits
    and debt are two different things. We are bringing the deficit
    by a trillion dollars. The debt rises, as many of you know,
    because of entitlements. What this President is not going to do
    is put forth proposals to cut benefits for our seniors in this
    country.
        Mr. Smith. You know, I think that we all care about our
    seniors. Social and Medicare. That is why this proposal,
    Director, is very alarming to me, that by the year 2032--by the
    year 2032, thanks to this $73 trillion worth of spending and
    the more than trillion dollar deficits every year by the
    proposal of this budget, that we are going to be at $45
    trillion of our national debt. But just paying interest on that
    national debt is going to cost us $1.1 trillion just on
    interest, which means that will now be the third largest
    program that we have to pay for in our entire government behind
    Medicare and Social Security.
        So, this reckless spending is actually devastating our
    seniors, because now it is competing with them as being one of
    the most costly programs.
        Let us go onto the tax increases. Analysis of the tax
    increases in the President's budget shows they will lead to
    fewer jobs in the country and a reduction in wages. What is the
    President's rational for imposing tax increases that will harm
    jobs, particularly when the country is trying to emerge from a
    pandemic?
        Ms. Young. I would be interested in seeing your analysis.
    The President has been very clear, he will not subscribe to
    trickledown economics. He believes that we should invest in the
    middle class, those working to get to the middle class. And he
    has a policy, and this budget follows it, not to raise taxes
    for anyone making less than $400,000.
        Mr. Smith. In this proposal you allow expiration of the Tax
    Cut and Jobs Act, correct?
        Ms. Young. Yes.
        Mr. Smith. And so, by expiration of the Tax Cut and Jobs
    Act, that is going to raise taxes on every average day American
    by $2,000 a year. And those are people making less than
    $100,000. So, in fact this budget does that.
        It also increases taxes on gasoline and fossil fuels by $45
    billion over the next 10 years. And like I said, the people of
    Southern Missouri, they are struggling to put gas in their car
    when gasoline has gone up 79 percent since Joe Biden took the
    oath of office here. And what his solution in this budget, to
    only increase taxes more on their gasoline, driving up $4.50 a
    gallon per gas to $5-6 bucks. How do you respond to that?
        Ms. Young. Easily. I think it was a bipartisan interest
    here to ensure that we counter Russian aggression as strongly
    as possible. And the President reminded the American people
    with that would come possibly higher gas prices and that has
    happened. He has been very clear with the American people that
    a strong response could possibly cause this to happen. Since
    Russian aggression gas has gone up about $1. It is unfortunate
    that Russia has chosen to bring the global economy down this
    path, but it was appropriate for all developing countries to
    stand together and push back on this tyrant and his actions.
        Mr. Smith. Director, I appreciate your comments and you are
    doing a great job for the President but let us get the facts
    out to the American people. On his first week in office
    President Biden did Executive Orders to eliminate the Keystone
    XL Pipeline that allowed us to purchase energy from our
    neighbors in Canada, also freezing new oil and drilling on
    federal lands. And let's put it this way, on April 24, 2020 at
    a Casey's in Southeast, Missouri you could buy gasoline at $.97
    a gallon. That was under a Trump Presidency. You can't find gas
    at $.97 a gallon. In 2020 we were energy independent. We were
    exporting energy in this country. But under the direct policies
    of President Biden and the Democrat controlled Congress, they
    reversed those policies to make us energy dependent on Russia,
    on Venezuela, on people who love to burn our flag. And it so
    unfortunate this budget proposal only wants to tax the energy
    industry more to make it harder on everyday Americans. And the
    Americans are going to see it.
        I am interested, there was $1.9 billion that was in this
    most recent omnibus bill that has been carried over to finish
    the border wall. Is this Administration going to finish the
    border wall?
        Ms. Young. Just so we are clear, the $1.9 billion wasn't
    rescinded. New money was not provided. The Administration had a
    policy asking Congress to rescind that funding. In 2021
    Congress did not. But Congress did not provide additional
    money. And we are spending, as GAO has told this Committee and
    others, that OMB, the President, the Administration is acting
    within the bounds of the Impoundment Control Act and we are
    spending obligating prudently.
        Mr. Smith. So, this Administration just continues to
    withhold the $1.9 billion that was appropriated several
    Congresses ago that has stayed in the account?
        Ms. Young. Thankfully GAO has agreed that we are obligating
    prudently under the law.
        Mr. Smith. And what are you obligating it to? Because you
    are not doing any construction, so are you just paying people
    to hold the rusting materials?
        Ms. Young. No, we are actually doing environmental
    restoration, something that was woefully lacking. We are also
    doing community consultation. I think that is important to many
    of you who represent constituents.
        Mr. Smith. I have 25 seconds, Director. I would like to
    know how did this Administration transfer almost $2 billion of
    COVID money to house illegals at the Southern Border when it
    was supposed to go toward replacing the national stockpile and
    for COVID tests?
        Ms. Young. It was supposed to go for COVID and it went to
    COVID issues at the Southern Border. COVID for COVID----
        Mr. Smith. So, housing illegals was issues for COVID?
        Ms. Young. We had to test people immigrating into this
    country and we also had to socially distance children who could
    not be close to each other due to COVID.
        Mr. Smith. Would love that documentation, Director, along
    with answers----
        Ms. Young. There is a binder we have provided to Congress
    full of COVID information.
        Mr. Smith. And answer to our 40 letters that are hanging
    out there to the Administration.
        Ms. Young. Including--yes, before budget day asking what
    was in the budget. But, thank you so much.
        Mr. Smith. Thank you.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from Pennsylvania, Mr. Boyle,
    for five minutes.
        Mr. Boyle. Well, thank you, Mr. Chairman. And it is
    wonderful, Director Young--now I can say Director Young. And I
    would always forget to add the acting anyway, so I am glad it
    is now official. And thank you for the wonderful job you do
    serving the American people.
        I wanted to use this as an opportunity just to focus on the
    major facts. Both you and Chairman Yarmuth talked about this
    before, but I think that a lot of times in these hearings the
    most important facts can sometimes be obscured by all the
    rhetoric that we hear. So can you remind us again, this past
    year it was the fastest economic growth in America in how many
    years?
        Ms. Young. 40.
        Mr. Boyle. And how many new jobs were created?
        Ms. Young. Over 6 million, the most in recorded history.
        Mr. Boyle. The most in American history. And by what amount
    is the deficit projected to fall?
        Mr. Young. $1.3 trillion, the largest decline year over
    year.
        Mr. Boyle. Greatest economic growth in American history,
    jobs added, largest deficit reduction. I don't remember many
    economists credibly predicting that this time a year ago. It is
    certainly a record to be very proud of, those in the
    Administration and, frankly, those of us who fought for fought
    for and voted for the American Rescue Plan.
        Now, I want to shift to the topic of raising taxes. Because
    we have two very interesting proposals that are out there.
    There is the one new proposal from this Administration that
    just came out, the billionaire minimum tax. I happen to be the
    lead co-author of the House version--or one version of what
    essentially is attempting to achieve the same thing, ensure
    that billionaires who are avoiding paying either their fair
    share or any taxes at all, make sure that they begin paying.
    But then there is this other interesting proposal from the
    Republicans. The Senate Republican leader of their Senate
    campaign committee has a proposal that as he was confirming
    yesterday on Fox News would raise taxes on more than 50 million
    Americans. In fact, more than half of those who are under the
    poverty line would pay higher taxes. Even further, his proposal
    and their proposal would sunset Social Security and Medicare
    after five years. And, again, this is not just an accusation.
    To his credit, he has openly admitted it and Fox News has
    confirmed it.
        So could you describe why the Administration believes it is
    more fair to go after billionaires who are currently paying
    lower taxes than middle class people in my district in
    Philadelphia as opposed to going after the poor and the working
    class?
        Ms. Young. Look, the budgets are value statements. The
    President has been clear about that. What he believes is fair
    is to ask billionaires and those worth over $100 million to pay
    about the same tax rates as teachers, nurses, and firefighters.
    That is all he is asking. They are supposed to pay taxes on
    this unrealized income. They often use loopholes, deferments,
    not to do that. So this President has been very clear, what we
    are not going to do is send forward a budget that cuts benefits
    to our seniors, but he will ask those worth--the 400 wealthiest
    people in this country are worth more than 150 million other
    Americans. He does not believe that is right and he is calling
    on them to pay their fair share.
        Mr. Boyle. And I am correct that the average effective rate
    among those 400 that you mentioned is currently 8 percent?
        Ms. Young. Research tells us it is about 8 percent.
        Mr. Boyle. Yes. I certainly know that the firefighters and
    teachers who live in my neighborhood in Northeast Philadelphia,
    they would love to pay an 18 percent--or, excuse me, an 8
    percent tax rate. They pay far higher than 8 or 18 percent.
        And just to be clear, this Administration is not supportive
    of the Senate Republican campaign committee chief's plan to
    raise taxes on more than 50 percent of the American people and
    sunset Social Security and Medicare, correct?
        Ms. Young. Not to comment on an individual proposal, but
    this President will not, has not--will not be submitting a
    budget that cuts benefits for our seniors.
        Mr. Boyle. Well, thank you. And I join with the
    Administration certainly in that and I thank you for your time.
        I yield back.
        Chairman Yarmuth. The gentleman yields back.
        I now recognize the gentleman from Mississippi, Mr. Kelly,
    for five minutes.
        Mr. Kelly. Thank you, Director, for being here.
        I just want to say I think the budget does show the values,
    and there is a 525 percent in the EPA while there is a decrease
    in defense spending. There is taxes that go higher for 700
    billionaires, but for $700 billion tax cut for millionaires. I
    don't know, I mean from where I am from millionaires are rich
    people too. So we are doing a tax cut to millionaires while
    increasing on billionaires.
        I hear all this about how great the economy is going and
    how many jobs, the unemployment rate is the lowest, and how
    many jobs are created. But here is what my people see in
    Mississippi, they go to a restaurant at lunch which is closed
    because there is not enough workers to open that restaurant,
    there is not enough workers to do the job. So if there is truly
    job increases and more people working, then why don't we have
    employees in restaurants and places where people go to eat?
        The other thing I see is inflation. You talk about no tax
    on people under $400,000. Well, I agree with Ranking Member
    Smith that, first of all, the $2,000 in taxes that goes away
    with the Tax Cut, that is a tax increase. It is $2,000 every
    American, regardless of income, will pay next year. The other
    is $3,500 annually in inflation last year--$3,500 more. What my
    people see, they don't see a better world today than they did
    last year, they see worse. When they go to the gas pump, when
    it cost $40--I will talk--because I have to actually fill up my
    car--instead of filling up and it costing $30 or $40, not it
    costs $70 or $80 to fill up. And trying to blame Putin for the
    gas rising prices is just not--is disingenuous. Prices were
    high before he invaded Ukraine.
        Here is what I will tell you, in last year's budget three
    considerations were given the most thing, and No. 3 of those--
    this is from the President and from the budget last year--not
    funding work that directly subsidizes fossil fuels, including
    work that lowers the cost of production, lowers the cost of
    consumption--that means prices at the pump--cost of consumption
    is what you pay for gas, or raises the revenues retained by
    producers of fossil fuels. When you intentionally raise gas
    prices you intentionally raise gas prices. And after you do
    that, you don't get to blame it on something that happened
    after the fact.
        I want to talk just a little bit about the defense. This
    budget proposes that we raise our defense a little bit, but we
    went through this same thing, but a lot of that goes to
    climate, to other things. What we need to do is make sure we
    keep above--the House and the Senate Armed Services Committees
    both sent to you that we needed a 5 percent increase over
    inflation. Can you truthfully tell me at the current inflation
    rate that the number given to defense is a 5 percent increase
    over the rate of inflation this year?
        Ms. Young. I will tell you our number is 9.8 percent over
    the 2021 levels. We believe we sent up a budget that is
    strategy based and we are not going to pick a budget out of
    thin air for political purposes. The Secretary stands behind
    this number and we believe when you see the National Defense
    Strategy, hopefully this week, that this budget is aligned with
    strategy.
        Mr. Kelly. I agree that it does not--it does not meet the 5
    percent increase over inflation, which means China and Russia
    continue--and this is a dangerous time and we need to do--we
    need to continue to raise that.
        I got back to the budget show the President's value. He is
    creating 87,000 new IRS employees to target folks making less
    than $400,000 to see where they spend every one of their
    dollars through monitoring their bank records so we can make
    sure we get every single dime out of those making less than
    $400,000 than we do. He is decreasing taxes on millionaires
    while raising it on billionaires, but I would argue he is also
    raising it on those people. And if you talk to the normal
    person, they truly do not believe that the economy is better
    off right now because their groceries go up, their milk costs
    more per gallon, their meat costs more, they are having to
    substitute things that they would rather not eat, they can't
    afford to fill up their cars now. They put in $10, which barely
    gets them any gas and the gas prices will continue to go up as
    long as we continue to try to cause them to go up.
        And going back to the President's words last year, he
    intended to make the cost of consumption of fossil fuels go up
    in his last year's budget. And I would say he succeeded in
    that. I hope he doesn't succeed in raising taxes on lower--on
    the IRS invading our homes and in continuing to not support the
    American people.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from New York, Mr. Higgins,
    for five minutes.
        Mr. Higgins. Thank you, Mr. Chairman.
        First, I just want to address the issue of energy
    independence. You know, the United States in the previous four
    years of the past Administration was importing about 22 million
    barrels of Russian crude oil every single month, and other
    petroleum products. And if we are really serious about energy
    independence, the Build Back Better program should be advanced
    so that we can make a transition, a real transition to electric
    vehicles.
        Today in the world there are 211 battery manufacturing
    plants, 156 of them are in China, 12 of them are in the United
    States. And we are engaged in a military activity in Eastern
    Europe right now primarily because of oil and natural gas. 65
    percent of all the natural gas that goes into Germany comes
    from Russia, 40 percent of all the natural gas that goes to
    each of the European Union countries comes from Russia. If that
    is not an urgent reminder of the need to become energy
    independent, the last 20 years in three Middle East wars and
    spending $6 trillion is.
        With respect to this budget, the American economy today is
    about $25 trillion. The billionaire's minimum tax I presume is
    a response to this whole concept of buy, borrow, die. In other
    words, very wealthy people buy an asset, they build an asset,
    they borrow against the asset, and they never sell the asset,
    and therefore they don't pay taxes on it. Jeff Bezos from
    Amazon, for example, is worth $200 billion. He pays himself a
    salary of about $81,000 a year and pays very little taxes. So I
    presume that the billionaire's minimum tax is intended to
    address that, recognizing the fact that it is perfectly legal,
    but I presume that is the purpose?
        Ms. Young. Yes. I remind people when regular people need a
    loan, you use your income to show the bank what you can borrow
    and pay back. The income, the investment income that we are
    taxing here often, as you pointed out, is never paid, taxes are
    never paid on it, they are deferred. But they also get a lot of
    benefits from carrying that investment income, including
    getting to use that as leverage for loans. It is treated like
    income for many actions that regular people only have work
    income to do with, including making extraordinary loans against
    their investment income. So we believe we believe we have to
    find a way to deal with this disparity of people who go to work
    every day, they are paying a higher tax rate on their work
    income. We have to find an equivalent way to deal with those
    who pay no income on taxes they are supposed to at some point,
    but often defer.
        Mr. Higgins. Well, interestingly enough, you know, Jeff
    Bezos in 2011 was only work $18 billion and he qualified for
    the child tax credit.
        The previous Administration had average economic growth
    each year of 2.5 percent. This is pre-pandemic. And then the
    economy went deeply into recession for a short period of time.
    Last year, the first year of the Biden Administration, economic
    growth was 5.7 percent and is project to be 3.6 percent for
    2022. Is that accurate?
        Ms. Young. That is accurate.
        Mr. Higgins. And you also, you know, have a situation where
    in the Build Back Better program, although that is not part of
    this budget, it is really an investment in American families,
    because every single day 10,000 kids are born in America, every
    single day 10,000 people in America turn 65. And we really
    don't have an American family policy. And the intent is really
    just to make our own people that much more economically
    independent, self-sufficient, and productive to and through
    adulthood. And, you know, all these concerns that I have heard
    in published reports about, you know, inflation, yes, that is a
    concern. We have hit 24 months of a highly distorted economy.
    It is going to take time to recover and we are in fact
    recovering. But, you know, the American economy will produce
    $300 trillion in stuff in the next 10 years. That is goods and
    services. Spending, investing, less than 1 percent of that in
    American families and the productivity of the American economy
    is not inflationary. In fact, it is an investment in future
    growth that can be, you know--inflation can be handled.
        But thank you very much.
        Ms. Young. Thank you.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from California, Mr.
    McClintock, for five minutes.
        Mr. McClintock. Thank you, Mr. Chairman.
        I think we need to get some fundamental facts straight
    here. And let us begin with three numbers--27, 58, and 89. 27
    percent is the growth in population and inflation combined over
    this past decade--27 percent. 58 percent is the growth in
    federal tax revenues in the same period--58 percent. That is
    more than double inflation and population growth. And by the
    way, that is after the Trump tax cuts produced one of the most
    prosperous periods for working Americans in our history. 89
    percent is the increase in federal spending. It is the spending
    stupid. We have before us a budget that dramatically raises
    taxes and claims that we are going to reduce the deficit. But
    taxes and deficits are the same thing. They are the only two
    ways to pay for spending. You either take it out of a family's
    current earnings or you take it out of their future earnings by
    borrowing it.
        A deficit, a future tax, is paid for in two ways. We either
    borrow it from capital markets that then reduces the amount
    that is available to make consumer loans and have to be paid
    back through future taxes, or we simply print that money, which
    produces inflation. That is largely how this Administration has
    financed its multi million dollar spending scheme. Results,
    nearly 8 percent annual inflation, costing an average family
    $3,500 in lost purchasing power, but it also means if a family
    puts $100,000 toward their retirement, they have just seen
    $7,900 taken from them. It turns out all that free money that
    you folks sent out is very expensive and Americans are paying
    it back at the gas station and the grocery store every day.
        Now, this budget repeals the Trump tax cuts. Now, remember,
    we took in more revenues after the tax cuts, so great was the
    economic expansion that they produced. And they weren't tax
    cuts for the rich. The wealthiest 1 percent saw their share of
    income taxes actually grow. The average household saved between
    $1,000 and $2,000. The Democrats would repeal these tax cuts.
        The corporate tax goes to 28 percent, higher than communist
    China. But corporations don't pay corporate taxes, people do.
    They can only be paid in one of three ways, by consumer through
    higher prices, by employees through lower wages, or by
    investors through lower earnings. That is your 401K. Now, they
    say they will make the wealthy pay their fair share. According
    to the Tax Foundation the wealthiest 1 percent earn 20 percent
    of all income and yet pay 39 percent of all income taxes. That
    is double their fair share.
        But put that aside for a second, you are proposing to tax
    unrealized capital gains. What is an unrealized capital gain?
    It is the paper increase in assets that you haven't cashed in
    on. It is a tax on money that you haven't received. But don't
    worry they say, that is just on those worth $100 billion or
    more. But once they have introduced this concept into law, how
    long will it take them to come after your pension funds earning
    before you have received them? You know, this whole mess isn't
    the fault of taxpayers for not paying enough taxes, it is the
    spending that is robbing families of their disposable income,
    their savings, and their future economic growth. And I think it
    is disingenuous to compare this budget to last and saying,
    well, the deficit is down and growth is up. Deficits are down
    only compared to the most irresponsible spending spree in
    American history that has produced the worst inflation rate in
    40 years. Growth is up only compared to the lockdown left's
    draconian COVID policies that took a wrecking ball to our
    economy and utterly failed to slow the spread of the pandemic.
        Americans are now getting a taste of what socialism
    consistently produces. There are 2.1 million fewer Americans
    working today than before the lockdowns. American family
    purchasing power has declined since this Administration took
    office. Inflation is at its highest rate in 40 years. Gas
    prices were up 40 percent before Putin invaded Ukraine.
        Now, the American people need to connect the dots between
    budgets like this and the conditions that they are now
    suffering before it is too late.
        I have got just one question. This Administration has
    admitted more than 1 million impoverished, illegal immigrants
    into the interior so far, in addition to a half a million
    gotaways. That is roughly the combined population of Montana
    and Wyoming, just since you took office. I am wondering, how
    much is this costing local, state, and federal taxpayers?
        Ms. Young. One, thank you for the diatribe. I--you know, I
    certainly----
        Mr. McClintock. I beg your pardon?
        Ms. Young. The--you know, which piece of what you put
    forward can I respond to? You put a lot out there that we have
    disagreements with the way it is framed. We have 700 people----
        Mr. McClintock. It is your policies that have caused these
    conditions. That is reality.
        Ms. Young. We have 700 people who are billionaires, 100
    millionaires that we are talking about, not regular Americans.
        Mr. McClintock. How much of the 1.5 billion are illegal
    immigrants that you have admitted into the country costing
    taxpayers?
        Ms. Young. This President will not raise taxes on anyone
    making less than $400,000.
        Mr. McClintock. That is the question.
        Chairman Yarmuth. The gentleman's time has expired. The
    gentleman's time has expired. If he will let the witness
    respond, then we can move on. But you can't continue to debate
    her and when your time is expired.
        Mr. McClintock. I asked her a simple question, I would like
    a simple answer. How much is this costing?
        Ms. Young. I look forward to the support you have for the 5
    percent increase at DHS that will allow to manage the Southern
    Border.
        Mr. McClintock. So it is in your don't know, don't care
    file? I get it.
        Thank you.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from New York, Mr. Jeffries,
    for five minutes.
        Mr. Jeffries. Thank you, Mr. Chairman, for you leadership,
    for convening us here today. Director Young, it is always
    wonderful to see you. Thank you for the extraordinary job that
    you and the Biden Administration are doing relative to the
    economy. Look forward to discussing some of those more accurate
    numbers momentarily.
        I see my good friend, Albio Sires. I want to just
    acknowledge his presence, congratulate him on the great run
    that the St. Peter's Peacocks had. Of course Albio is a former
    varsity basketball player for St. Peter's. He set this all in
    motion. Albio, it is good to see you and what a great run. I
    know you are proud as a peacock.
        Shalanda, Director Young, there were several numbers that
    were thrown out, but I want to talk about just a few more
    accurate ones. 3.8 percent. That is the unemployment rate. But
    when President Biden first took office, just a little over a
    year ago, that unemployment rate was about 6.4 percent. Is that
    correct?
        Ms. Young. That is correct.
        Mr. Jeffries. And did it come down in record time?
        Ms. Young. Let me point out that all of this was not by
    accident. None of the numbers we have talked about--the fastest
    decline in history, the employment rate, would have been
    possible without this President's management of the pandemic.
        Mr. Jeffries. That is correct. Beginning with the American
    Rescue Plan, which not a single one of my Republican colleagues
    voted for in either the House or the Senate, that was the
    foundation for turning the economy around. And the economic
    growth comparison doesn't relate to what happened when the
    country shut down under the previous President. Am I correct
    that what we have seen under the Biden Administration, the
    Biden economy, is the fastest rate of economic growth in 40
    years?
        Ms. Young. It is. Absolutely, year over year.
        Mr. Jeffries. Now, with respect to fiscal responsibility,
    my colleagues talk a lot about that and they talk about
    socialism. You know what socialism is, that is the GOP tax
    scam--83 percent of the benefits going to the wealthiest 1
    percent. That is socialism for the wealthy, the well off, and
    the well connected for no reason other than to subsidize the
    lifestyle of the rich and shameless.
        I am proud of the economy and the budget that you have put
    forward, which is designed to invest in every day Americans. In
    fact, wages are up right now. But we do have to continue to
    work to lower costs. Could you speak a little bit about that
    effort in the context of this budget?
        Ms. Young. Absolutely. One, I spoke about global supply
    chain challenges. We need to get stuff off of ships and onto
    shelves. And this budget provides investments in our port
    infrastructure. I also want to thank the Congress for the
    infrastructure bill. A second round of Army Corps funding was
    just announced that dredged important ports around the country
    to ensure that we can move these goods to shelves so the
    American people can continue to buy things. And we believe that
    is a key part of fighting inflation. We also believe we have to
    ensure that corporations, companies have competition in the
    system in the way we operate.
        So we absolutely know we have to work on this, but one
    thing we need to do is a balanced approach. We have seen wage
    growth. We need to make sure as we tackle inflation we can keep
    these gains in wage growth and also economic growth. So there
    is a balancing act here.
        Mr. Jeffries. Now, with respect to some of the revenue
    proposals, I think most every day Americans would have no issue
    with increasing the taxes that 25 richest billionaires in
    America pay because currently they pay little to no taxes. That
    is less tax often than firefighters, police officers, nurses,
    social workers, transportation workers, healthcare aids, and
    our healthcare heroes who have helped us get through this
    pandemic. Can you talk a little bit about the resources that
    are being raised just in the context of what it will allow us
    to invest in as the Biden Administration invests in every day
    Americans?
        Ms. Young. So tax reform has two benefits. One, it is a
    fairness issue. Should the richest Americans, 700 people, pay
    less than half of regular folks who you represent. The other
    benefit of tax reform is we get to invest in the regular
    Americans who have price pressures that we have talked a lot
    about here today. Should we have legislation that reduces the
    cost of childcare, for example? Families shouldn't pay more
    than we think--shouldn't pay more than 7 percent of their
    income on childcare costs. We believe that we should have
    efforts to negotiate prescription drug prices through Medicare,
    so families can afford lifesaving treatment.
        So we have a difference of agreement. We all want to help
    these families, but we think the way to do that is through
    proposals that invest in the American people to help with those
    pocketbook issues that both sides of the aisle have brought up
    many times today.
        Mr. Jeffries. Thank you very much.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from Texas, Dr. Burgess, for
    five minutes.
        Dr. Burgess. And I thank the chair and thanks to our
    witness for being here today.
        You know, we have not had a hearing with the Congressional
    Budget Office, the base line CBO report has not come out, and
    when you ask the reason why, at least what they told me was
    because OMB was--hadn't produced their numbers yet. Now,
    perhaps, Mr. Chairman, that OMB has produced the President's
    budget we will get to hear from the Congressional Budget
    Office. But in that interim, in that meantime, the Director of
    the CBO could visit with some of us individually. And I am
    grateful that he did that.
        So let me just ask a couple of things that were assertions
    that were made to me by the Director of the CBO. And I will ask
    you to attest to their veracity or not. One of the things the
    CBO Director said was that we vastly underestimated how strong
    the economy was going into the pandemic. And thank God that it
    was, to be able to withstand the ravages of the pandemic. But
    would you agree with that statement, that the economy so
    significantly stronger than anticipated going into the
    recession?
        Ms. Young. I would say we did enter a recessionary period
    during the pandemic. We believe we were able to recover from
    that not from the economy that was there before the pandemic,
    but because of the work, in many cases bipartisan work. This
    Congress on a bipartisan basis passed COVID legislation to help
    the former Administration respond to the pandemic and ARP----
        Dr. Burgess. Yes, let me----
        Ms. Young [continuing]. we believe to finalize the job.
        Dr. Burgess. Let me reclaim my time. The fact is we were on
    our way out of the recession when we threw gas on the
    inflationary fire with some of the other reconciliation bills
    that passed last calendar year.
        Mr. Swagel also asserted that the collections, the federal
    income tax collections that--and I guess we are working current
    laws, the 2017 tax law, correct? And that collections have been
    at all time highs. In fact, they didn't diminish during the
    pandemic. They have been sustained. Was that an accurate
    statement that----
        Ms. Young. Yes.
        Dr. Burgess [continuing]. he made to me?
        Ms. Young. Yes.
        Dr. Burgess. So even under what people are describing as a
    dreadful and unfair taxing system, it is producing historic
    levels of revenue more so than the pre-2017 tax law that had
    been in place for 31 years, greater than that produced? Is that
    correct?
        Ms. Young. We think the wealthiest did quite well during
    the pandemic.
        Dr. Burgess. That, you know, wasn't the question.
        Let me ask you this, Mr. McClintock asked it and then it
    didn't get answered, but taxing unrealized gains, OK, that is
    going to be a little tough, but I am sure someone will be able
    to figure it out, but what happens to those equities that are
    held in retirement as retirement securities? Are those
    unrealized gains in that fund going to be taxed as well?
        Ms. Young. No, we are not talking about that. We are
    talking about unrealized gains from stocks for the 700 people
    who are worth more than $100 million.
        Dr. Burgess. Will they be able to deduct--I have also been
    a holder of some investments when the economy went the other
    way and the statement during the 1980's was well, you haven't
    lost it until you sold it. Will they be able to deduct losses
    from their taxes if the market goes down?
        Ms. Young. For those 700 people we are phasing over five
    years for exactly the reason you talk about. We don't want to
    get into a situation where on year your stock may be worth $100
    and you pay and then you come and ask for a refund when it is
    worth $80 the next year. So this is a phased in approach for
    things you own before this will go into----
        Dr. Burgess. Yes. Good luck. It sounds absolutely----
        Ms. Young. So in five years.
        Dr. Burgess [continuing]. unworkable. Let me just ask you
    this. I see where the commitment is made to provide--the total
    was $4 billion, it is now nearly $1 billion this year that is
    going to the governments of Central America. And this I assume
    is on top of the foreign aid that was already going to El
    Salvador, Guatemala, and Honduras. Is that correct?
        Ms. Young. We do have a----
        Dr. Burgess. This is in addition?
        Ms. Young. Yes. We do have a request in to deal with the
    northern triangle.
        Dr. Burgess. And methods of accountability. I mean if those
    governments really cared about the people that they were
    supposed to care about, I don't think we would have as many at
    our Southern Border. Are there built in accountability methods,
    as the previous Administration had done?
        Ms. Young. The previous Administration, as you point out,
    did not send funding down. We also have the option. The way
    appropriations usually writes the law to withhold if we aren't
    getting the results. We need see, but we do believe we have to
    deal with the root causes of migration and this funding would
    allow us to do that.
        Dr. Burgess. Well, again, I submit you are pouring gasoline
    on fires that exist.
        Mr. Chairman, let me just ask you this, are we ever going
    to vote on a budget this year?
        Chairman Yarmuth. That is a good question.
        Dr. Burgess. Maybe if we vote on a budget will the
    President's budget be introduced and give everyone a chance to
    vote on the President's budget?
        Chairman Yarmuth. That decision hasn't been made.
        The gentleman's time has expired.
        I now recognize the gentlewomen from Illinois, Ms.
    Schakowsky, for five minutes.
        Ms. Schakowsky. Thank you, Mr. Chairman.
        Director Young, welcome and congratulations.
        Ms. Young. Thank you.
        Ms. Schakowsky. It is wonderful to see you here.
        You know, I am so happy that you mentioned I think a couple
    of times that the President believes in building an economy
    from the middle out and the bottom up. It is so refreshing to
    me. And despite the robust support for the wealthiest Americans
    and the biggest corporations that I hear from the other side of
    the aisle, in fact most Americans understand that the rich have
    been getting richer and the poor have been getting poorer, not
    by accident but by policy, tax policy, et cetera, that we have
    had. And that the President is committed now not to punish the
    wealthy, but to say they need to pay their fair share. And
    there is a big cheer out in bipartisan way in this country for
    that kind of idea.
        For the last 10 years we have really had an austerity
    budget, particularly because of sequestration. And so I--and it
    has really I think hurt so much of our economy. And one agency
    I wanted to talk to you about that has been the victim of
    sequestration has been the National Labor Relations Board,
    which has remained pretty much flat funded since 2014.
        And so in order for it to really--for the NLRB to really do
    its job, it needs to have increased funding. We have seen a 50
    percent increase in union election petitions, but the total of
    funding has fallen by 30 percent since the year 2010.
        Now, I know that the budget that you have--that the
    President has presented has actually increased the NLRB funding
    by 16 percent, but I wanted to ask you if you really feel that
    the kind of funding that we are going to be able to see is
    going to help protect and empower American workers. And let me
    just add the second part, would the Administration raise any
    concerns if the Congress were to provide additional funding
    increase to the NLRB?
        Ms. Young. None at all. And, as you point out, the agency
    has really been starved of resources and has lost significant
    staff capacity over the years. This budget I would say begins
    the rebuild with a $45 million requested increase. But
    certainly if Congress wants to start that rebuild faster, we
    would be supportive.
        Ms. Schakowsky. Let me ask you another question. One of the
    constituent service issues that I get all the time is that
    people, ordinary people who are trying to get information about
    their 2020 taxes has been a real problem. And I am just
    wondering if we are going to be able to bolster the number of
    employees at the IRS that are going to be able to address this
    problem?
        Ms. Young. So as you have heard, we have an increase in the
    budget for IRS. We believe it is--Americans should not have to
    wait for hours on hold to get information about their tax
    situation. If there is one mistake on your form, you often have
    to--some of the worst stories--wait months to get refunds due
    to you. So we believe that this increase is the right thing to
    do for the American citizens who are required to pay taxes and
    should have this service that goes along with that requirement.
        Ms. Schakowsky. Thank you.
        And it seems to me too that if we are looking at making the
    most of efficient work of the IRS, that we also begin to look
    again at the wealthiest Americans who we are--you know, it is
    kind of like where do you go, you go where the money is. And I
    am just wondering if we can refocus on making sure that the
    very wealthiest are paying something, because we have seen
    paying nothing too often from the wealthiest Americans. Can we
    make sure that we are not just focusing on every day working
    people, but also on the people who are making the most money?
        Ms. Young. So we are--I am certainly not going to suggest
    that we tell the IRS who to look at, but I will point out not
    just the wealthiest corporations, 50 corporations on the
    Fortune 500 list paid no taxes in 2020. We think that is not
    right. So certainly this budget recognizes inequity that you
    have pointed out and we do need resources in the IRS mostly to
    ensure that our citizens can get the services they deserve.
        Ms. Schakowsky. Thank you.
        I yield back.
        Chairman Yarmuth. The gentlewoman's time has expired.
        I now recognize the gentleman from Georgia, Mr. Carter, for
    five minutes.
        Mr. Carter. Thank you, Mr. Chairman.
        Director Young, thank you for being here. I appreciate your
    attendance very much.
        And I want to ask you, Director Young, the President said,
    and I quote, ``Budgets are statements of values and the budget
    I am releasing today sends a clear message that we value fiscal
    responsibility, safety, and security at home and around the
    world.'' Let me begin saying that I applaud these new found
    priorities that include advertised increases for defense at 4
    percent. However, as we all know, inflation is at 8 percent. So
    if we are increasing the defense by 4 percent, we are actually
    looking at a cut here.
        So even though inflation ends up it being a cut and we also
    see a cut for funding the police, let me ask you, Director
    Young, was the Administration aware that Russia was occupying
    Crimea and other parts of Eastern Ukraine?
        Ms. Young. I am happy to talk about the budget elements----
        Mr. Carter. And that is what I am getting.
        Ms. Young. OK. I would leave that to the policy experts in
    the Administration, but that is not my----
        Mr. Carter. But you would agree that they were aware of
    this even though they proposed a cut in defense?
        Ms. Young. That is a policy best directed----
        Mr. Carter. Understand.
        Ms. Young [continuing]. to the Department of Defense or the
    National Security Council.
        Mr. Carter. Understand.
        Ms. Young. I would be happy to answer anything about the
    budget.
        Mr. Carter. Yes, I got you. And that is why I am asking
    this, because this is about the budget. Did the Administration
    consider Russia an adversary or a threat to national security
    of the United States at the time when it only increased defense
    by 1.6 percent? And that is a budget question. Because when you
    formulate a budget, as the President said, it represents your
    values. So what I am trying to get at here and what I am trying
    to understand is what the Administration considered when they
    proposed a cut in defense.
        Ms. Young. Do we consider the 4 percent increase this year
    a cut?
        Mr. Carter. We do because inflation is at 8 percent.
        Ms. Young. We don't see the defense budget as a cut. The
    Secretary of Defense will--I am sure many of you will hear from
    him when the comes to Congress. He will tell you he stands
    behind this number and we believe it is strategy based.
        Mr. Carter. What about crime in our cities as well?
    Because, again, if it represents the values, then the values
    have to go along with knowing what is going on in our country,
    knowing what is going on in our world. If we are talking about
    a budget that reflects the values of the Administration and the
    values of this country, what about the cuts that went to state
    and local governments from the Justice Department of $2
    billion.
        Ms. Young. There are no cuts in the budget to cops for--we
    are asking for a $300 million increase in community oriented
    policing, $3.2 billion for all state and local grants at DoJ.
        Mr. Carter. But there are--to the Justice Department, there
    are cuts of $2 billion.
        Ms. Young. The grants to state and locals to deal with
    violence is increased in this budget. In addition, there is a
    mandatory proposal we hope that many of you will support of $30
    billion to deal with crime in all our communities.
        Mr. Carter. Let me ask you something. And obviously I am
    trying to get a point across here, that we are making cuts to a
    budget, to defense, to crime, where we should be making
    increases and where we should be reflecting our values, as the
    President says this budget is supposed to reflect the values of
    this Administration, of this country, and of this executive
    branch. So that is what I am trying to about, to get the point
    out here.
        And from last year--I asked this question last year, does
    the Administration not think that these are credible threats
    when talking about defense spending that we should be conceding
    our world leadership role? And yet, here we are a year later
    and we are still making essentially cuts to defense and not
    addressing crime like we should be.
        This budget is too little, too late. It truly embodies the
    Administration's leading from behind strategy. In fact, I would
    call it simply reacting. People have already died. People have
    died because of crime, people have died because of our lack of
    funding defense. The number of murders in 2021 was 5 percent
    higher than counts recorded in 2020. And, as we know, Russia
    has invaded Ukraine.
        Again, if we already knew these were problems, and they
    were widely reported, why are we just now asking for funding to
    fix them?
        Ms. Young. Funding that are increased over last year. I
    hope we can, you know, agree to, you know, simple facts.
    Department of Defense will receive a 4 percent increase under
    this budget. We ask again, Congress did not provide, but this
    President is asking again for community oriented policing,
    increase of $300 million and we are asking for support of our
    mandatory proposal for $30 million to deal with violence.
        Mr. Carter. Understood, Ms. Young. But, again, I am trying
    to get at what the President is referring to as the values that
    this Administration embodies and that this Administration
    embraces. Trying to understand that.
        Just out of curiosity----
        Chairman Yarmuth. The gentleman's time has expired.
        Mr. Carter. Thank you, Mr. Chairman, and I will yield back.
        Chairman Yarmuth. The gentleman's time has expired.
        I now yield five minutes to the gentleman from Nevada, Mr.
    Horsford.
        Mr. Horsford. Thank you so much, Chairman Yarmuth, and to
    the Ranking Member.
        Director Young, thank you for being here today to speak
    with us and for your work to deliver a budget that proves that
    we can invest in America while also bringing down the deficit
    and fighting inflation. You should be proud, Director Young.
    You have risen from staff director, from the House
    Appropriations Committee, to now testifying in front of
    Congress as the Senate confirmed director for OMB. We could not
    be prouder for you.
        I want to commend the Administration's efforts to finally
    make the wealthiest in this country pay their fair share in
    taxes. For too long the hardworking men and women of this
    country have been left holding the bag while billionaires have
    used their army of tax lawyers to pay virtually nothing in
    federal taxes. If we want to invest in the American spirit and
    do so in a financially responsible way, then we need proposals
    like the 20 percent minimum tax to at least make sure
    billionaire CEOs pay a comparable rate to regular hard-working
    Americans. I don't understand how my colleagues on the other
    side would want an average person in their district to pay more
    than a billionaire.
        By proposing the deficit reducing budget, President Biden
    made sure that we can responsibly invest in our working
    families, but we must ensure that those investments actually
    make it to the individuals who need them most. Even though more
    Americans are taking home a paycheck and families have more
    money in their pockets, family budgets are still tight. Anyone
    can see that prices are rising on essential goods across my
    district and in this country. The pain for working families I
    real and it is imperative that this Congress work with the
    Administration to lower costs for everyday American. Reducing
    our deficit, increasing our domestic productivity, and lowering
    families' biggest costs, can fight inflation while also
    investing in America.
        In Nevada, and specifically my district, we have seen
    unconscionable increases in the cost of rental housing, with up
    to 30 percent increase in rental costs over the past year. I am
    pleased to see that there is $50 billion in this budget for
    affordable housing construction to grow our supply of housing
    stock and to stabilize these high price increases.
        Director Young, as you know, many of the inflationary
    pressures we feel today are from repeated supply side shocks.
    So in your opinion, what are some other meaningful steps the
    Administration could take to provide a budget similar to this
    one to relieve supply constraints and deliver lower costs to
    Americans?
        Ms. Young. So, I have talked a little bit about the need to
    get things off of ships. We have seen extraordinary backlogs at
    many of our ports, from the West Coast to the south. Not just
    funding, but we have tried to bring the full weight of the
    Administration to deal with our port challenges, including
    going so far as to recruit truckers to get more truckers on the
    road to move goods. Also ensuring that our railways--we can get
    things moving by rail. We saw during the pandemic--you know, it
    was a good problem to have at the time--people bought a lot of
    goods. Our economy turned from service based where people spent
    a lot of money on services, to purchasing a lot of goods. And
    it fundamentally how our economy operated. So we have to keep
    our foot on the gas to make sure that we can unclog our supply
    chain issues because some of those things are going to be with
    us for a while. We still haven't seen the return to services
    out of the pandemic that you would expect our economy service
    to good ration to be.
        Mr. Horsford. Absolutely.
        With my remaining time I want to turn to demographic data
    collection. I am pleased to see throughout the budget an
    investment in data collection on STEM participation, climate
    impacts, and maternal health disparities, but more needs to be
    done.
        So, Director Young, while there are significant investments
    in the President's budget toward racial equity in particular, I
    want to focus on the Justice-40 commitment of $3 billion. What
    is the Administration's plan to make sure these investments are
    targeted accurately to reduce disparities and direct funding to
    the hardest hit communities throughout our country?
        Ms. Young. I am sure you know about our Executive Order
    13985. It requires that we incorporate equity in all we do,
    racial equity, rural equity, those left behind, our disabled
    brothers and sisters. Our government should work for all people
    all the time. So when we do procurement we want to make sure
    that our dollars are spent with socially disadvantaged
    companies. So we are implementing this Executive Order not just
    in the budget, but in how we do business.
        But you are right, without data we don't know if we are--
    what kind of job we are doing. So we are absolutely committed
    to improving our data collection.
        Mr. Horsford. And I look forward to working with you in
    your role as director of OMB so that we can have better data
    collection and make more informed decisions.
        Thank you.
        Mr. Chairman, I yield back.
        Chairman Yarmuth. The gentleman yields back.
        I now recognize the gentleman from Virginia, Mr. Cline, for
    five minutes.
        Mr. Cline. Thank you, Mr. Chairman. I want to thank the
    Director for appearing today.
        Last year when you testified before this Committee, the
    Consumer Price Index was up 4.2 percent over the last 12
    months--and at that time was the largest 12 month increase
    since 2008. Almost a year later, thanks to the Biden
    Administration's policies, the annual inflation rate for the
    U.S. is 7.9 percent for the 12 months that ended February 2022.
    And we can blame Russia for gas prices, we can blame the supply
    chain for inflation rates, we can blame the--all of the
    different policies of this Administration, but this is the
    highest inflation rate since January 1982, according to U.S.
    Labor Department Data published March 10. That translates into
    a $3,500 annual inflation tax that is being paid by, as you
    said, normal people. In 2021, $296 extra per month going toward
    the higher cost of inflation due to this Administration's
    policies, 54 percent higher inflation growth than wage growth,
    a $12,000 inflation tax to be paid by American families under
    the Biden budget. The price of meat is up 13 percent, the price
    of milk is up 11.2 percent, the price of electricity is up 9
    percent, the price of baby food is up 8.4 percent. Gas prices
    have risen since Joe Biden took office 82 percent. That is
    $2,000 in additional costs per family due to the rising cost of
    gas.
        So the path we are on is unsustainable. This budget does
    nothing to address inflation. In fact, the term ``inflation
    crisis'' doesn't show up in this budget once. And it pushes
    into perpetuity permanent fiscal imbalance. It does nothing to
    address the permanent imbalance in revenues and expenditures
    that this federal government is experiencing. So it kicks the
    can down the road and the national debt is nearly the size of
    our economy and will reach a record 107 percent of GDP by the
    end of the decade.
        I want to focus on two things that are going to be
    happening in this decade, the insolvency of the Medicare
    Hospital Insurance Trust fund and the insolvency of the Highway
    Trust Fund and then the insolvency of the Social Security, Old
    Age, and Survivor Insurance Trust Fund by 2033. Why is it that
    the Biden Administration is not sounding the alarm about this
    looming crisis? And why doesn't this budget, which should be a
    reflection of the values of this Administration, propose to
    avoid this insolvency in Social Security, Medicare, and Highway
    Trust Fund that my constituents depend on so much back at home?
        Ms. Young. Thank you, Mr. Cline.
        One, I want to assure you, the budget assumes, and it is
    built into the numbers, that those programs, even given
    insolvency, that those programs continue at the current rates.
    So that is built into our figures. We are required to do that
    by law. So the assumption--all the numbers you have here assume
    that those programs continue.
        Mr. Cline. But it--so it assumes that they are heading for
    insolvency in the years that I cited?
        Ms. Young. It shows that we are spending the same level,
    the benefits don't stop.
        Mr. Cline. Which will result in insolvency in the years
    that I cited.
        Ms. Young. Yes, we absolutely need bipartisan solutions. My
    guess is it is going to take both sides of the aisle here and
    the Administration to come together to find solutions to make
    sure we deal with the insolvency issues. You are absolutely
    correctly point out----
        Mr. Cline. Your part is in control of the presidency----
        Ms. Young. But----
        Mr. Cline [continuing]. your party is in control of
    Congress, so I would encourage you all to put forward those
    solutions so that we can work with you.
        Ms. Young. I appreciate that, but I would like to ensure
    that you know the budget fully assumes that those programs
    continue.
        Mr. Cline. Assumes that they go off the cliff.
        I have no further questions.
        I yield back.
        Chairman Yarmuth. The gentleman yields back.
        Before I recognize Ms. Wexton, I want to remind everyone
    that at 12 o'clock we are going to take a recess for a half
    hour, which means we will hear from Ms. Wexton, Mr. Feenstra,
    Mr. Scott, Mr. Good, and Mr. Sires and then everybody else will
    be--have to come back after 12:30.
        So with that I yield five minutes to the gentlewoman from
    Virginia, Ms. Wexton.
        Ms. Wexton. Thank you so much, Chairman Yarmuth. And,
    Director Young, it is wonderful, wonderful to see you again.
        So a lot has changed over the past year, including your
    confirmation by the Senate. I couldn't be happier that you are
    now Director Young.
        Now, reflecting on where we were one year ago, I think it
    is important that we remember, you know, how far we have come.
    And you have already talked about that some. I mean we have
    added more than 6 million jobs, the most ever in a single year.
    The unemployment rate is now down to pre-pandemic levels. We
    have vaccinated more than 200 million Americans.
        Now, when President Biden took office, the daily COVID
    reporting was about 250,000 infections every day and we are now
    at a tiny, tiny fraction of that. We lowered the child poverty
    rate to the lowest level ever and the number of families
    reporting food insecurity also dropped 32 percent. Now, that
    didn't all happen on its own, it happened because we passed the
    most significant economic legislation ever, the American Rescue
    Plan, which literally saved the economy. On top of all that, we
    passed infrastructure legislation that is finally going to help
    us fix our aging roads, bridges, and power grids, amongother
    things, also make universal broadband a reality. And we finally
    ended the joke of ``Infrastructure Week'' once and for all. We
    were even able to do that with some Republican assistance, so
    thank you to those folks who crossed the aisle who actually
    voted for that legislation.
        Not to mention the COMPETES Act, which is going to be--
    going to conference shortly and will be singed into law I think
    not before too long, which will definitely put the U.S. in a
    much better place globally for now and into the future.
        So it has been quite a year. And I just want to thank you
    for everything that you have done to help us get there.
        Now, I represent tens of thousands of federal workers in
    the D.C. Metro region. I know that you are aware of this. And I
    wanted to thank you for what you did in the budget. First thing
    I do when I get it is flip to the federal employees' section to
    see where the pay increase, and I was pleasantly surprised to
    see that it was 4.6 percent. So thank you so much for that. I
    along with a number of people from the Metro Region had been
    advocating for 5.1 percent, but I think that 4.6 is the
    highest--is the biggest increase in many decades. Is that
    correct?
        Ms. Young. I have been a federal worker in some form or
    another for 21 years. I can't remember an increase this large
    in recent memory.
        Ms. Wexton. Thank you so much. And it is a lot better than
    the freezes and cuts to benefits that were proposed by the
    previous Administration.
        I also want to talk for a minute about substance abuse
    treatment. Now, the nation's overdose crisis--you know, our
    overdoses were up 17 percent from 2019 to 2020 and it has
    gotten even worse over the course of the----
        Chairman Yarmuth. We have lost the audio. Your signal is
    frozen. You should be back now.
        Ms. Wexton. OK. Sorry about that, Mr. Chairman. I tried
    plugging in and everything.
        But, anyway, so about substance abuse treatment and
    substance abuse coverage. Can you just explain how the budget
    addresses mental health and substance use disorder coverage?
        Ms. Young. Thank you for that.
        The budget includes $500 million increase over 2022 for
    state opioid response grants and $1.2 billion over the 1922 CR
    level for the substance abuse prevention and treatment block
    grant. You heard the President speak to both mental health and
    opioid as something he hoped to bring the country together.
    These are bipartisan interests. So we are very proud of putting
    forth robust requests for both opioid--the opioid epidemic to
    deal with it and also the mental health crisis. And in some
    ways these two things are connected and this budget seeks a
    holistic way of dealing with both.
        Ms. Wexton. Thank you so much. And that is something that
    affects every congressional district across the country,
    regardless of whether it is represented by a Republican or a
    Democrat. So thank you for doing that.
        I was also really happy to see a 19 percent increase in the
    funding for the National Science Foundation, especially because
    they will be doing a lot of research into the opioid addiction
    treatment and the future of medical treatment for those
    disorders. So thank you so much for that as well. Very good to
    see that this critical research will be fully funded.
        And with that, I yield back.
        Chairman Yarmuth. The gentlewoman yields back.
        I now recognize the gentleman from Iowa, Mr. Feenstra, for
    five minutes.
        Mr. Feenstra. Thank you, Chairman Yarmuth and Ranking
    Member Smith. And I want to thank you, Director Young, for
    testifying today. It is great to see you and I just want to
    congratulate you on your confirmation as role of director.
        Talking with economists, and I taught many economics
    classes over the years, most economic people would say that it
    takes approximately 18 months to have something--to go into
    effect--full swing effect when you start talking about taxes,
    especially when you want to increase taxes or something like
    that. Would that be a fair statement concerning the Department
    of Revenue and things like that?
        Ms. Young. I just want to make sure I understand you. So
    we--if Congress passes these policies tomorrow, we--it would
    take 18 months to see the effects?
        Mr. Feenstra. Yes, there a part--12 to 18 months. Because
    you have to collect the revenue and things like that.
        Ms. Young. Correct. But we would see the receipts during
    the next budget cycle, the next fiscal year. So we would
    actually I believe----
        Mr. Feenstra. Eventually. I mean you would have--so that
    would take six to eight months, probably be a year to 18 months
    before you see the true effect?
        Ms. Young. We think we would see the receipts next tax
    season and begin to see a reduction in our deficit within that
    first year of implementation.
        Mr. Feenstra. So the reason I am saying that is that we
    passed the Trump tax cuts and now they are coming into full
    effect. And we have seen a 5.7 percent growth increase, and
    frankly that is because of the Trump tax cuts that happened. I
    think that is a fair statement. And yet we want to repeal the
    tax cuts in this budget. I think that is really bizarre when
    you have an economy that is going very fast. Obviously we have
    inflation and all this other stuff, and yet we now want to chop
    the legs off from underneath what has happened through all
    these tax cuts.
        That being said, I just want to note that a budget is a
    statement of values and I tend to agree with that. And we all
    understand that we have an energy crisis in our country. I mean
    we are all paying a tremendous amount of gas at the pump right
    now and it affects every family and business. So my question
    is, being from Iowa, why don't we have American made biofuels
    in this budget? There is not a line item or anything in here
    that addresses biofuel, American made. Can you address that?
        Ms. Young. I am happy to discuss. I believe EPA will have
    more details when they talk about their biofuels work, but what
    this President is also doing, he has released 60 million
    barrels of oil from the strategic national stockpile. We
    believe that is a quick way to deal with the inflationary
    pressure.
        Mr. Feenstra. Well, I thank you for that, but there is no
    biofuels. I mean here is American made Iowa, Midwest biofuels,
    and crickets, nothing, zero in the budget.
        Anyway, I think I have a question for you. In the budget
    proposal you clearly lay out $2.5 trillion in new taxes on
    families and businesses and then you create a side deficit
    neutral reserve fund to pay for your Build Back Better
    priorities, but you don't really show how you do that. At the
    same time it says here in this green book that your baseline
    includes all revenue provisions from Build Back Better, which
    would mean that the Biden Administration is increasing taxes by
    $4 trillion.
        I am trying to make sense of this. Is it $2.5 trillion you
    are increasing or is it $4 trillion based on this book that I
    see and what it says?
        Ms. Young. So we are holding some revenue back for
    legislation that we talked about here today to cut costs for
    the American people. I will point out one thing we are not
    repeating in this budget that if Congress would like to use its
    savings for Build Back Better, and it is the savings--we get
    about $600 billion to reduce the cost of prescription drugs,
    the AGS surtaxes and other things.
        Mr. Feenstra. But I get that, I get that. But in essence it
    is $4 trillion then because you are putting in this line item.
    You are showing us here that you are assuming that H.R. 5376 is
    going to be a pass, so in essence that would be a $4 trillion
    increase?
        Ms. Young. Yes, we are holding revenue for legislation and
    its cost for families----
        Mr. Feenstra. A $4 trillion increase.
        Ms. Young [continuing]. and raising additional tax revenue
    in this budget.
        Mr. Feenstra. Gotcha. All right. One more question. I am
    worried about our seniors. I really am. About what is going to
    happen in society here. And you said that you didn't do
    anything to change how things were happening right now. So in
    essence we are telling our seniors that our Social Security
    Trust Fund will be gone by 2031. You are talking Highway Trust
    Fund that will be done by 2027, Part A will be done by 2026.
    This is going to scare a lot of seniors, don't you think?
        Ms. Young. I think the scarier thing is if we put forth
    options to reduce their benefits, which this President is not
    going to do.
        Mr. Feenstra. I don't think anybody is asking to reduce
    their benefits, unless the Democrats are asking to reduce the
    benefits----
        Ms. Young. Well there have been some proposals----
        Mr. Feenstra [continuing]. or the Administration is asking
    to reduce the benefits.
        Ms. Young [continuing]. around to do that. We are not going
    to do that. We think focusing on the wealthy and those making
    more than $400,000 is the more appropriate thing to do.
        Mr. Feenstra. OK. So seniors sitting at home, the budget
    doesn't touch this. I mean this is scary time. I mean if I am
    them, I am going, oh, my word. I am 68, 78, I have no more
    money, I have no more Social Security Part A.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from Virginia, Mr. Scott, for
    five minutes.
        Mr. Scott. Thank you, Mr. Chairman, Ranking Member, and
    congratulations, Director Young, for your confirmation.
        I want to thank you for your patience as you have been
    lectured about fiscal responsibility. I just want to point out,
    as you know, that every Democratic president since Kennedy is--
    every Democratic administration since Kennedy has left office
    with a better deficit situation than they inherited, without
    exception. And every Republican president since then has left
    office with a worse deficit situation than they inherited,
    without exception. President Trump was well on his way to
    fulfilling that trend before the pandemic.
        And so my question is will President Biden maintain that
    trend of Democratic presidents improving the deficit,
    notwithstanding all of the lectures you have been hearing?
        Ms. Young. So, sir, I will repeat again, and I am happy to
    report that we have seen the largest year over year decline in
    the deficit this year. $1.3 trillion in this budget would also
    further reduce the deficit by over $1 trillion in the next 10
    years.
        Mr. Scott. Thank you.
        And you have heard a lot about the $3,500 inflation that
    families are having to address. I think they have ignored the
    fact that your Administration has actually done something to
    help them address that $3,500 burden. For a family of four,
    stimulus checks of $5,600 would help them pay the $3.500, child
    tax credit, $6,000 would help them the $3,500, improve their
    premiums in the Affordable Care Act, increased benefits under
    the earned income tax credit, increase SNAP benefits. All have
    helped them deal with inflation. And it works. There is a
    measure of stress. Credit card delinquencies last year
    according to the Federal Reserve were the lowest rate they have
    been since they have been keeping records.
        You have also mentioned that you are not only helping them
    make the payments, you are doing something about it. You talked
    about the supply chain, trains, roads, and bridges. I want to
    thank you for your investments in the ports. Hampton Roads
    didn't suffer the problem, but in the California ports that had
    ships all out in the ocean. Those good could have been in the
    market helping to reduce prices, increase the supply. You made
    those investments.
        You have also invested in productivity, in childcare.
    Millions of people could go to work if we had better childcare.
    Job training. They can work better. And that is work too. You
    mentioned job creation, best job creation in history.
        And so you actually are doing something about it.
        So my question I guess is, is it better to do something
    about it or just sit back and complain?
        Ms. Young. Well, we are not going to do that. And so we
    believe--and there are legitimate differences here, but this
    President believes that it makes sense to bring down the cost
    of healthcare for Americans. We are talking about inflationary
    pressures. Look at the exorbitant amount that Americans pay on
    healthcare. We believe that we should have legislation that
    brings down energy costs for Americans. And childcare you
    mentioned. So we--again, I am--legitimate differences here, but
    this President has put forth ideas in which to deal with them.
        Mr. Scott. Thank you. Better to do something about it than
    just complain.
        As you know, I chair the Committee on Education and Labor.
    And one of the problems in education is student loans. And that
    is exacerbated by the erosion of the value of the Pell Grant.
    Are you doing anything on Pell Grants?
        Ms. Young. One, Mr. Scott, thank you for the omnibus bill
    recently passed that would up Pell Grants by $400. We also
    invest in Pell Grants in this budget. Through your Committee we
    are asking to increase the maximum Pell Grants. This President
    wants to double Pell Grants to get Pell Grants closer to
    $13,000. So both on the discretionary and mandatory side we are
    asking for increases to meet the President's goals.
        Mr. Scott. There is a chronic achievement gap of low-income
    students. Have you done anything with Title 1?
        Ms. Young. Title I, again, I want to thank all of you for
    the omnibus, which provided record increase of $1 billion for
    Title I that helps our children across school districts across
    the country. We continue to ask for $19 billion more so our
    children have access--all of our children have access to first
    class education.
        Mr. Scott. And in the labor space. Let me ask three
    questions all at once. Are you doing anything for those
    returning from prison, are you protecting people from
    discrimination with the EEOC, and with increased interest in
    joining unions while the work force at the NLRB has been
    declining, are you doing anything at the NLRB?
        Ms. Young. You have heard that we have a $45 million
    increase in NLRB to begin to rebuild that important agency. As
    far as formerly incarcerated persons, we think it is
    appropriate to invest to ensure--it is part of our crime
    initiative. We are asking for $30 billion in the mandatory
    space to bring down crime, institute criminal justice reform,
    and help those formerly incarcerated become productive citizens
    in this country.
        Mr. Scott. And the EEOC?
        Ms. Young. And EEOC asking for increase, Mr. Chairman.
        Mr. Scott. Thank you.
        Thank you, Mr. Chairman.
        Chairman Yarmuth. The gentleman yields back.
        And now I would like to recognize the gentleman from
    Virginia, Mr. Good, for five minutes.
        Mr. Good. Thank you, Mr. Chairman.
        Director Young, would you say that this Administration is
    economically, financially, and fiscally incompetent and doesn't
    understand the consequences of this indefensible budget? Or,
    worse, this Administration does understand the tremendous harm
    they are doing to the country, and therefore wants to destroy
    the country financially and bankrupt our future?
        Ms. Young. Mr. Good, thank you for that. I don't accept
    either of those premises----
        Mr. Good. I am going to reclaim my time and not make you
    try to defend the indefensible.
        A small business owner within the hour just told me on the
    phone, he is a builder, a developer, a job creator with my home
    district in Virginia, five, and he just said ``Nothing they're
    doing makes sense unless they hate the country.'' So, again, I
    am going to take most of my time to speak rather than ask you
    defend the indefensible, because this proposed budget exposes
    either the incompetence or the deviousness of this
    Administration.
        You literally couldn't do more harm fiscally to the country
    unless you were doing it on purpose. To spend $73 trillion--God
    forbid Democrats ever find out what comes after a trillion--so
    that you spend $73 trillion over the next 10 years, a 66
    percent increase--66 percent over the previous 10 year period,
    for what? What is the average American going to get for this
    budget? What are they going to get besides higher taxes on all
    Americans, more debt, which will require additional higher
    taxes rapidly increasing inflation, which decrease purchasing
    power--in effect another higher tax on Americans--less control
    over their own lives and how they spend their money, decisions
    they make, from what kind of cares they drive to how they heat
    their homes, and a bleaker financial future for their children
    and their grandchildren.
        This budget proposes $58 trillion in taxes, 80 percent
    increase over the previous 10 years. The only thing the
    Democrats do more or raise more quickly than spending is
    taxes--again, on all Americans. But not to worry to any
    American who has the misfortune of watching this hearing, not
    to worry, because this budget hires 87,000 more IRS agents,
    America, to make sure they collect those taxes they intend to
    increase on all of you and to make sure that you pay what they
    consider to be your fair share. I am sure my fellow colleagues
    and Members in this Committee hear from their constituents the
    same thing I do. The one thing we need is more IRS agents. How
    about if we instead make the IRS employees actually come to
    work and process those outstanding tax refunds from last year?
    Incredibly, when we owe $30 trillion in national debt. And I am
    embarrassed to say that on this Committee when I say that I
    have Members on the other side say don't talk about how much we
    owe, because when I say it is $90,000 per citizen right now--
    $90,000 per citizen for 330 million Americans for $30 trillion
    in national debt, I get told by leadership on this Committee,
    don't say that because we are not asking anybody to pay it
    back, as if it is not real. As if it is Monopoly money and it
    doesn't matter, it doesn't count. It is already, what, the
    third largest budget is paying the interest on the debt. Every
    1 percent increase in the interest rate costs us roughly $300
    billion a year just to pay the debt.
        So I am sure my--so this Administration--so here we have
    got $30,000 in debt and we actually propose or admit--we
    admit--we have the audacity to admit that we are going to to
    intend to increase the national debt by another $16 trillion
    over 10 years--$16 trillion over 10 years. That is $50,000 per
    American.
        I submit that no American would vote for that willingly and
    say, yes, raise my share of the national debt by $50,000
    because I am going to get what from this budget. What American
    would vote for that?
        This budget, comparing apples to apples, it is a 30 percent
    increase, $1.4 trillion, over the fiscal--for fiscal 1923 over
    the last year, fiscal 1920, before the government crushed the
    economy in the name of the China virus. So, in other words, it
    was $4.4 trillion budget in fiscal 1919, now in fiscal 1923--or
    fiscal 1920 is $4.4 trillion, now in fiscal 1923 it is $5.8
    trillion, a 30 percent increase. Incredibly, the incompetent
    and irresponsible response of this Administration beyond that
    is trillion dollar increases in the deficit as far as the eye
    can see.
        Meanwhile, this Administration, the President said it
    during the State of the Union speech, and you have said it
    already here this morning, we are trying to give ourselves a
    medal and pat ourselves on the back because we are going to be
    the first Administration in the history of the country to cut
    the deficit by a $1 trillion in a year. So just because we are
    not spending the ridiculous amount that was unwarranted in the
    name of the China virus, and we don't have quite that much
    spending in this bloated, exorbitant, massive budget proposal.
        Director Young how can you keep the title of the Director
    of Management and Budget? Don't you think it should be called
    the Director of Mismanagement and Excessive Spending? I mean is
    that management? Is that budgeting, what we are doing?
        Ms. Young. Mr. Good, if you would like a policy that cuts
    Medicare and Social Security, which you are promoting, either
    you raise revenues on the wealthy, or you cut Medicare and
    Social Security
        Mr. Good. What I propose is we don't bankrupt the future of
    America and we don't do it on the backs of our children and our
    grandchildren.
        Chairman Yarmuth. The gentleman's time has expired.
        I now recognize the gentleman from St. Peter's for five
    minutes, Mr. Sires.
        Mr. Sires. Thank you, Mr. Chairman.
        Director Young, first of all, thank you for coming before
    this Committee to answer questions about the President's budget
    proposal for 2023. And let me first start by saying that I love
    this country. I think this is the greatest country in the
    world. I think that there is no other country like this country
    and I am eternally grateful for the opportunity to have come to
    this country for me and my family. So I do not hate this
    country, I do not hate this budget. As a matter of fact, I am
    pleased with the request for the robust funding levels in
    programs that are important to me.
        First of all, let us talk about affordable housing. I come
    from a district that affordable housing is very important.
    Director, do we have an increase in there?
        Ms. Young. Not only do we deal with the demand issue
    through increase in vouchers, we have a $50 billion mandatory
    proposal that ensures that we deal with the lack of supply many
    communities have.
        Mr. Sires. Thank you.
        Do we have an increase for security of communities with
    police?
        Ms. Young. $3.2 billion, including a $300 million increase
    for cops, as well as a $30 billion multi-year proposal to deal
    with community violence.
        Mr. Sires. So that goes along with what the President said,
    there is no cut in policing, right?
        Ms. Young. There is an increase for policing.
        Mr. Sires. There is an increase. Thank you very much.
        Do we have an increase of Pell Grants, something that is
    very important to my district, especially people who I
    represent?
        Ms. Young. Absolutely, sir. We believe that is a path to
    making college affordable for those amongst us that can't
    afford college and leave college in debt. And we are on the
    path to doubling the maximum Pell Grant.
        Mr. Sires. Thank you, Director.
        And under this President do we have an increase in
    infrastructure spending? Because my whole state in New Jersey
    is one big transportation hub and there is a very aged
    infrastructure. And I am very happy to see that the
    infrastructure bill was passed and the increase that we are
    seeing. So do we have an investment in infrastructure in this
    country?
        Ms. Young. Yes, we continue our investments through
    increases in the Department of Transportation, 6 percent over
    the 1921 levels, the Department of Housing and Urban
    Development, and some of those investments in the housing
    supplies we have talked about.
        Mr. Sires. Thank you, Director.
        And I know that every time we increase--the Democrats
    increase defense funding, defense funding is never enough. But
    do we have an increase in defense funding--spending in this
    bill?
        Ms. Young. The Department of Defense would see a 4 percent
    increase over the omnibus level.
        Mr. Sires. But obviously when it is the Democrats that
    increase it, it is never enough.
        And I have to ask you one more question which is important
    to me. People always criticize the undocumented, the people
    that are working in this country that do not have documents. Do
    they contribute to Social Security?
        Ms. Young. Many of them do and many of them pay local taxes
    and contribute to their communities.
        Mr. Sires. Now, and many of them do not collect their
    Social Security when they retire, right?
        Ms. Young. It would be difficult. I don't know how they
    would do that without proper paperwork?
        Mr. Sires. So that is money that goes into our budget.
    Would you know how many billions of dollars that is? Or----
        Ms. Young. No, sir. But I would be happy to see what we
    have and to provide it for the record.
        Mr. Sires. Yes, I would appreciate it if you would do that,
    because, you know, I know it is as much as $9 and $10 billion
    that they never collect because they either go back to their
    country or they are just not allowed to collect it.
        Ms. Young. That is correct, Congressman, that is my
    understanding of how that would work. If they paid into the
    system, there would be no way to get funding out of the system.
        Well, I just want to say thank you for this budget, thank
    you for you being here so we can ask you all these questions. I
    am sure that in your 26 years of work in this field you have
    developed enough experience to be called Director of the Budget
    Office.
        Thank you.
        Ms. Young. Thank you.
        Chairman Yarmuth. The gentleman yields back.
        Per our agreement with Director Young, the Committee will
    recess briefly.
        Without objection, the Committee will stand in recess
    subject to the call of the chair. I request that Members return
    at 12:30 p.m. so the hearing may proceed.
        [Recess]
        Chairman Yarmuth. The Committee will come to order. We will
    now continue with the hearing, the question and answer period.
    And I now yield five minutes to the gentlewoman from Iowa, Mrs.
    Hinson.
        Mrs. Hinson. Well, thank you, Mr. Chairman, for holding
    this hearing. And thank you, Director Young, for coming before
    us today. I look forward to hearing your answers to our
    questions.
        I would like to start off by thanking our Ranking Member
    Smith for pointing out that the Tax Cuts and Jobs Act will
    expire as a part of this budget, raising taxes on working
    families in Iowa. It raises taxes on our small business, on
    firefighters, on teachers, on shift workers building tractors,
    and on the healthcare heroes who have dedicated their lives to
    make others healthy, especially during a pandemic. We are going
    to reward them with a tax increase.
        I just finished my fifth 20 county tour across the
    district, held a telephone town hall last night. There is a
    clear consistent theme from my constituents. What I am hearing
    on the ground, what I heard on that last night, and that is the
    concern about rising prices. So whether it is farm repairs,
    farm inputs, the price at the pump for gas, the increases for
    everyday goods like groceries, bacon, milk, working families
    are struggling right now to continue to put food on the table.
    And that is largely because of the Administration's policies.
    And we know increased federal spending is driving up these
    costs.
        And yet the President's budget request proposes $73
    trillion in spending over the next 10 years with a projected
    $14 trillion impact on the deficit. That is a tab that is up to
    the next generation to have to pay. We are leaving that for
    them. Inflation today is at 7.9 percent, the highest it has
    been in four decades, and yet the President's budget plan
    assumes inflation will only be 2.3 percent through the next
    foreseeable future here, all the way to 2032. This is just out
    of touch. And we have heard why that it so, but I asked you a
    little bit about this same issue last year. Here we are a year
    later with even worse inflation than what we had a year ago.
        So my question is why is the Administration continuing to
    make these claims that are out of touch about inflation, low
    inflation here, high inflation with what we are paying at the
    grocery store and what consumers are actually facing. Because
    that is affecting Iowans every single day.
        Ms. Young. We hear you, Mrs. Hinson, and we share your
    concerns. We might disagree on a proposal to get inflation
    under control, but the President is concerned about these cost
    pressures on Americans. You mentioned farmers. We have worked
    at the Administration, for example, to ensure that those who
    work farms can, for example, fix their own equipment. We have
    found that there is that competition always and people have----
        Mrs. Hinson. Right to repairs, completely different issue
    from what I am asking about here. I am asking why specifically
    or not being accurate in your accounting of inflation here.
    Because I mean if you are making a budget projected based on
    numbers that are wrong, that is irresponsible and disrespectful
    to taxpayers.
        Ms. Young. Well, actually the numbers were baked in
    November. That is how budgets work. We have to close the books
    at some point and send you a budget. But I hope you know that
    inflation both--has an offsetting effect. Both revenues usually
    go up with higher inflation as well as spending. Therefore the
    long-term projections are not affected by a different inflation
    rate. But you are absolutely right, it is higher than our
    estimates were in November when we locked what we
    affectionately call a data base.
        Mrs. Hinson. Well, I hope going forward that we can be
    cognizant of the fact that those numbers are inaccurate, so as
    we as a Committee are continuing to work with you and your
    office, being cognizant these numbers are not right is going to
    be crucial as we are making the right decisions.
        I am glad you mentioned farmers in this Administration
    because Americans are struggling with the cost of fuel. This
    includes billions of dollars in funding for EVs and charging
    infrastructure. These taxpayer dollars do nothing to actually
    drive down the cost of fuel for Iowans, but the subsidies will
    make inflation even worse.
        And on the campaign trail the President came to Iowa and
    looked Iowans in the eye and said you could count on him for a
    new era of biofuels, quoting the President here, ``Lip service
    won't make up for nearly four years of retroactive damage that
    has decimated our trade economy and forced ethanol plants to
    shutter.'' So we have heard that it is already not in this
    budget, but I am wondering why. Why is it not in this budget?
    Why does the Administration break their promise here to Iowans
    and to Americans to not support the usage of renewable
    biofuels, domestic fuels, domestic energy production, like
    ethanol?
        Ms. Young. Thank you for bringing this up. And I am sorry I
    didn't get a chance to fully address this with Mr. Feenstra.
        This budget, as you all know, starts October 1. Many of the
    inflationary increases we are seeing in gas have to do with the
    Russia-Ukraine situation. We have to deal with that fluid
    situation before this budget even takes effect. So we are happy
    with the $13 billion this Congress provided to help with
    assistance to Ukraine, but the gas situation in addition to
    selling 60 million barrels from the strategic petroleum
    reserve. We will also be looking to other things in which to
    bring down costs for Americans. But that is going to be before
    this budget takes effect.
        Mrs. Hinson. Well, we are looking at obviously projections
    here for many years out, so I think Iowans want to know why it
    is not included. If you are having conversations about all
    these other things in the future, why is biofuels noticeably
    missing.
        My final question, we have obviously 2 million encounters
    at the southern border, we saw some increased funding for CBP
    in the omnibus and a supplemental there, but we are back at
    square one here with these cuts--to propose cuts to the CBP.
    So, again, why is that happening?
        Ms. Young. You see actually a 5 percent increase to DHS,
    including for agents. Many in our party will disagree, but we
    believe there is a necessity for additional personnel to ensure
    that we have an orderly immigration system. In addition to
    that, we have an increase for immigration judges to make sure
    we move people through the legal system. So we absolutely have
    put forth what we believe is a balanced approach to deal with
    the border.
        Mrs. Hinson. Well----
        Chairman Yarmuth. The gentlewoman's time has expired.
        Mrs. Hinson. Thank you. I yield back.
        Chairman Yarmuth. I now recognize the gentleman from
    Massachusetts, Mr. Moulton, for five minutes.
        Mr. Moulton. Thank you, Mr. Chairman. And, Director Young,
    thank you so much for being here with us.
        A lot of my questions are about modernization. How we face
    the future and meet the challenges and opportunities that it
    presents. Can you talk to me for a second about how we are
    modernizing our military? Our national security? Here we are
    watching Russian tanks get destroyed by drones on TV. One of
    the biggest threats that Americans face from this ongoing war
    in Ukraine is the threat of cyber attacks here at home. And our
    biggest adversary in the world is China. China has not only
    invested in future capabilities, like advanced missile systems,
    space systems, and artificial intelligence, but they have made
    important cuts to make those investments possible.
        We used to quite frankly be thrilled that China had a
    million man army because it wasn't that good. Well, they have
    cut that army to invest in future capabilities. How is the
    Administration meeting that challenge?
        Ms. Young. Thank you for that.
        And we are increasing the Department of Defense budget by 4
    percent. It is in line with the National Defense Strategy. Last
    year the Administration was new, still working on how we saw
    the military of the future. But we are investing more in AI, we
    are invested in hypersonics.
        In addition to the legacy equipment, F35s, submarines that
    many, many of you are interested in, so we have to do both. We
    have to invest in our traditional capabilities as well as look
    to the future, including our cyber threats.
        Mr. Moulton. It has often been said that Congress gets in
    the way of the cuts we need to make to invest in the future.
    Would you agree with that?
        Ms. Young. Out of deference to my former place of
    employment, I am just going to say this is the beginning of a
    process and I look forward to working with you throughout it.
        Mr. Moulton. Well, if you won't agree to my statement, I
    will. I think we have a lot of work to do here to make sure
    that we are not just protecting parochial interests at the
    expense of our national security.
        China is also trying to out compete us in foreign aid by
    attacking really one of our strengths. And that is the allies,
    the partnerships that we have around the globe. Look at much
    they are investing in places like Africa. This budget puts $682
    million toward Ukraine's support. Is that correct?
        Ms. Young. That is correct. But remember, that is the
    longer-term objective. What we are really using for enhanced
    humanitarian aid now is the $13 billion Congress thankfully
    provided to us earlier this month.
        Mr. Moulton. It is amazing to compare $682 million that we
    are investing or proposed to invest in Ukraine with the amount
    that Trump proposed investing in Ukraine when he tried to
    blackmail Zelensky, which was exactly zero.
        Director Young, it is also important that we take this
    opportunity, having passed this historic infrastructure bill,
    to invest in the future of transportation. Is it the
    Administration's position that we should invest in modes and
    investments in--that have a high ROI, a high return on
    investment for the American taxpayer?
        Ms. Young. That is what we believe. We also believe
    projects should have high benefit-cost ratios. And we certainly
    have put out guidance, at the consternation of some, that does
    try to focus our transportation in innovative modernizing ways.
        Mr. Moulton. I mean I would point out that high speed rail
    has some of the highest ROIs in transportation, which frankly
    is why the rest of the world is investing in it. China has
    built in just the last 12 years the largest high speed rail
    system in the world.
        Are you familiar with the size of the United Kingdom's
    budget compared to our own?
        Ms. Young. I am not actually.
        Mr. Moulton. Well, the United Kingdom, a country that is 1/
    40th our size, is investing $120 billion on a single high speed
    rail line to the north of the country. How does that compare
    with our investments in high speed rail?
        Ms. Young. I mean clearly, Mr. Moulton, we have to work
    with Congress, as you pointed out, that represents many
    different parts of the country.
        Mr. Moulton. Well, I would just say that if America is 40
    times bigger than the United States, we shouldn't be moving
    around much more slowly than the rest of the world. The Brits
    can go three times as fast as we can on our interstate system
    on their new high speed rail line. Investing in more highways
    creates more traffic jams. Investing in a lot of electric
    vehicles makes those traffic jams silent, but we still have a
    lot of traffic jams.
        So we have passed this historic infrastructure bill. I
    think the Administration has an opportunity to truly make these
    investments for the future. We can build more 1950's era trains
    and railways, or we can build for the future. And I hope you
    take that opportunity.
        Ms. Young. Thank you.
        Chairman Yarmuth. The gentleman yields back.
        I now recognize the gentleman from Florida, Mr. Donalds,
    for five minutes.
        Mr. Donalds. Thank you, Mr. Chair. Director, thanks for
    being here. I really do appreciate it.
        Obviously, you know, a budget in five minutes, we are not
    going to be able to deconstruct this entire thing. So let us
    try to focus in.
        No. 1, the corporate tax increase. The corporate tax rate
    under your budget--under the President's budget, excuse me--
    goes up to 28 percent. Is it the Administration's belief that
    an increase in the corporate tax rate will have no impact on an
    already inflationary environment with higher prices for
    consumers?
        Ms. Young. We don't believe it will change the operations
    of how corporations make decision. No, we don't.
        Mr. Donalds. Well, no, no, the question, Director Young,
    does the Administration believe that higher corporate income
    taxes will have an--will force an increase in prices in an
    already inflationary environment that a lot of people actually
    really believe now was unleashed by the American Rescue Plan
    from last February.
        Ms. Young. Mr. Donalds, I do--we do not believe that is the
    case.
        Mr. Donalds. OK. So the Administration doesn't think that
    higher taxes are going to lead to higher prices on top of an
    already inflationary environment?
        Ms. Young. For corporations, are you assuming they pass on
    their tax rates onto----
        Mr. Donalds. Right. Corporations always pass on the costs
    increases. They are doing it with inflationary costs with the
    ability to get their products right now. The portions that they
    need to create their products to sell to consumers, when the
    cost of freight is up, the cost of wheat is up, the cost of oil
    is up. That is all being passed through. Yes or no?
        Ms. Young. Mr. Donalds, I don't believe that--we don't
    believe, this Administration, that asking corporations to pay
    28 percent--they used to pay 35 percent before the last tax
    cuts--will increase inflationary pressures.
        Mr. Donalds. Director Young, does the Administration
    acknowledge the fact that when the corporate tax rate was cut
    from 35 to 21 that the United States raised more revenue in
    corporate income taxes than in any other point in American
    history?
        Ms. Young. What we saw was a continued use of legal
    loopholes that prevented--I mentioned this earlier--50
    corporations of the Fortune 500 from paying any taxes.
        Mr. Donalds. I am not talking about the uses of what is
    already in the tax code. I actually would argue that if we are
    going to have a fair code, we should adopt a flat tax or a fair
    tax. I mean I don't think that is the Administration's
    position. That is my position if we are going to have a fair
    code. But to talk about what they use in the current legal
    structure of the tax code, you can't make that argument and say
    that, oh, well they are using these things. I am talking about
    did they raise--did the government raise more revenue from
    corporate income taxes? Yes or no?
        Ms. Young. And corporations continue to make more. That is
    the point, Mr. Donalds.
        Mr. Donalds. All right. Let us move on, because I know we
    are not going to get anywhere there.
        In your proposal, I am reading like the expanded
    explanation here.
        Ms. Young. You are reading the green book?
        Mr. Donalds. Yes, I am reading the green book right now.
    Right now we have a serious situation in the United States
    associated with gas prices and rising oil prices, which is
    going to impact every American, whether they are rich or poor,
    whether they are black or white. The one thing that will be
    consistent is that it will affect everybody. There will be no
    inequality associated with rising energy prices. In your budget
    proposal the Administration is actually saying that they are
    going to unwind every tax benefit associated with fossil fuels
    in the United States. Does the Administration believe that
    completely eviscerating all oil and natural gas tax treatments
    that we have had in our country frankly for 30-40 years, do
    they believe that that will actually lead to lower prices on
    oil and natural gas?
        Ms. Young. We don't believe the tax structure offered will
    lead to increased gas prices, but you are right, Mr. Donalds,
    we have to do something to bring down the cost. But I hope you
    would agree that costs have gone up since the Russian
    aggression in Ukraine.
        Mr. Donalds. Director Young, we have to acknowledge that
    oil prices have been up far before Vladimir Putin invaded
    Ukraine on February 24.
        Ms. Young. But $1 since.
        Mr. Donalds. The price of a barrel of oil was up
    significantly, the price of gas was roughly $3.65 cents on
    average in the United States. That was already significantly
    higher than what it has been over the last four years in the
    United States. Do you acknowledge that?
        Ms. Young. I acknowledge that there were increased energy
    prices that have further increased since Russian aggression.
        Mr. Donalds. Director Young, OK, so we understand that
    prices are higher now since February 24. we are going to
    acknowledge for the record that prices have been higher under
    the President's Administration currently. The President has
    talked about how he wants to get away from fossil fuels. Is the
    Administration's position that essentially eliminating all tax
    treatment, which makes oil and gas production in the United
    State far easier, that that is actually going to be to the
    betterment of the United States from an energy perspective
    going forward I the country?
        Ms. Young. Mr. Donalds, we think we need a comprehensive
    approach. I will remind everyone here, our country is one of
    the three before Russia took this route that produced over 10
    million barrels a month. This country----
        Mr. Donalds. Let me ask you a question.
        Ms. Young [continuing]. does not have an oil production
    problem.
        Mr. Donalds. A quick followup on that. That is under
    current tax treatment. I would argue that if the tax treatment
    and oil and gas companies goes up, we are going to have a
    production problem. But to that point, one of the main talking
    points from the Administration is that you want an economy that
    works for everyone, you want a tax system that is fair. Is it
    fair for the green energy portion of energy in the United
    States to have significantly more favorable tax treatment than
    oil and natural gas?
        Ms. Young. As we know, these are developing systems. We
    need to ensure that those systems, as many systems in this
    country have received----
        Mr. Donalds. So it is OK for oil and natural gas to be
    treated unfairly.
        Chairman Yarmuth. The gentleman's time has expired.
        Mr. Donalds. But we were getting to the answer, Chairman.
    Come on, now, give me a couple of minutes. Come on, Chairman,
    we were good.
        Chairman Yarmuth. Well, I will let her answer, but you
    can't continue to debate.
        Mr. Donalds. All right, all right, all right. Thank you,
    Mr. Chairman.
        Director Young, please.
        Ms. Young. And, Mr. Yarmuth, thank you.
        And, by the way, many of the subsidies for people who want
    to buy electric vehicles, this is to help consumer. Many
    consumers want solar panels, many consumers want electric
    vehicles. The government--we believe the best way to help them
    achieve that and also a cleaner world is to provide subsidies
    through our tax system.
        Chairman Yarmuth. The gentleman's time----
        Mr. Donalds. The Chairman cut me off. I am good. Thanks,
    Mr. Chairman. Thank you, Director Young.
        Chairman Yarmuth [continuing]. has expired. The gentleman's
    time
        Ms. Young. Thank you, Mr. Donalds.
        Chairman Yarmuth. As always, you have the opportunity to
    submit questions in writing to the Director and she can then
    subsequently answer for the record.
        I now yield five minutes to the gentlewoman from
    Washington, Ms. Jayapal.
        Ms. Jayapal. Thank you, Mr. Chairman. Director Young, it is
    great to see you and to call you Director. Congratulations
    again on your appointment.
        And I wanted to say, first of all, that there are many
    things in this budget that we appreciate, including the taxes
    on the wealthiest. As you know, I am a lead sponsor of the
    Ultra-Millionaire Tax Act. We also appreciate the restrictions
    on stock buy backs, as well as some of the immigration
    provisions that you mentioned earlier. The investment in
    judges, the legal counsel, and community-based alternatives to
    detention. We appreciate all of those things. So thank you for
    those.
        Switching gears, America has a monopoly crisis that is
    strangling small businesses and hurting people's pocketbooks
    while corporations have made immense profits through pandemic
    profiteering and price gouging. And I was very pleased to see
    the historic increases to the anti-trust division and to FTC to
    robustly enforce our anti-trust laws. But that is just one
    piece. As you know, we have very bipartisan efforts here in
    Congress to give federal agencies more tools to ensure
    competition.
        Director Young, do you agree that those efforts should be
    prioritized?
        Ms. Young. We do. And that is why we talked earlier--
    increasing competition is one way. We have to deal with
    inflation in this country. And why you see a $273 million
    request for the anti-trust division and Department of Justice,
    $88 million increase, 48 percent over 2021, and a $498 million
    request or a 40 percent increase over 2021 for the FTC.
        Ms. Jayapal. Thank you. And I also appreciate the
    Department of Justice's recent letter stating the Department's
    views that the ``Rise of dominant platforms presents a threat
    to open markets and competition. And we are looking forward to
    moving our package along.''
        Now, you won't be surprised to know that I need to express
    my deep concern with the 4 percent increase in defense
    spending. This is on top of the unprecedented increase over the
    President's fiscal 1922 request that just became law.
        Director Young, can you tell me how much the Pentagon has
    given to just five contractors?
        Ms. Young. Are we just picking contractors?
        Ms. Jayapal. Five large----
        Ms. Young. I am sure I can----
        Ms. Jayapal [continuing]. contractors.
        Ms. Young [continuing]. yes--get back to you,
    Congresswoman, on the top contractors I assume you are
    interested in.
        Ms. Jayapal. Let me tell you that up to one-third of
    Pentagon contracts after 9/11 went to just five contractors.
    And from Fiscal Year 2001 to 2020 these companies received $2.1
    trillion in 2021 dollars. And in fiscal 2020 alone the Pentagon
    have $75 billion in contracts to Lockheed Martin, which totals
    more than one and a half times the entire budgets of the state
    Department and USAID.
        Director Young, is the Pentagon the only federal agency
    that has never passed an audit?
        Ms. Young. I believe that is correct.
        Ms. Jayapal. So--and it has actually failed its last four
    audits. And yet we are continuing to pile money on top. And I
    would just say that to Representative Moulton's questions, I
    would argue that there are more efficient ways to spend the
    money we have. It doesn't mean that we can't have solid and
    secure national security if we actually cut out waste, fraud,
    and abuse and focus on the technologies that are going to
    provide us with the biggest bang for the buck. And yet it seems
    that our only strategy on military spending is bigger is
    better.
        Do you think that bigger is better for ever and ever,
    Director Young?
        Ms. Young. I think a defense budget has to be strategy
    based. I have--Congresswoman, you have been a long time
    advocate here on getting rid of waste, fraud, and abuse in the
    Department of Defense. That is accurate. But we have also heard
    from the other side of the aisle who believe our number isn't
    large enough. That is why we believe the right thing to do here
    is use the long-term defense strategy to build our budget.
        Ms. Jayapal. Director Young, what--you know, I assume that
    the other side also would agree that we don't want waste,
    fraud, and abuse in our Pentagon budget. And I remember last
    year, or last term, under a Republican president, we actually
    had a Republican budget director come and testify that the
    Pentagon should pass an audit. What work is going on to make
    sure that the Pentagon passes a budget before we continue to
    increase military spending indiscriminately just to thump the
    patriotic banner and say that somehow because we are increasing
    military spending, even though we can't pay for our veterans
    here at home, even though we can't invest in education in the
    ways that we want, even though we are having debates around
    whether or not we have enough money for childcare, something
    the President has advocated for, by the way, more childcare.
    But as we have those debates, how are we going to make sure
    that the taxpayer dollars that we are spending are actually
    going to an audited agency that has cut out waste, fraud, and
    abuse?
        Ms. Young. There is no reasonable person who would disagree
    that the Pentagon should be able to pass a basic audit. But I
    do want to reiterate, we think the need here is to put forward
    a budget that is tied to a national strategy. Whether or not
    you agree with the strategy is another thing, but as you heard,
    there are a lot of opinions on what the defense number should
    be.
        Ms. Jayapal. Director Young, you know how I have been
    advocating on this for a long time and I just don't understand.
    There is nothing that is contradictory to a national defense
    strategy when we talk about making sure the Pentagon passes an
    audit and cuts out waste, fraud, and abuse before we heap more
    dollars on it.
        So thank you again for your tremendous service to our
    country in the role that you currently occupy and in everything
    you have done before this. And I hope we can work together to
    actually make taxpayer dollars mean something instead of just
    profits to five defense contractors.
        The gentlewoman's time has expired.
        Ms. Jayapal. Thank you, Mr. Chairman.
        Chairman Yarmuth. Thank you.
        I now recognize the gentleman from Ohio, Mr. Carey, for
    five minutes.
        Mr. Carey. Thank you, Mr. Chairman, Ranking Member Smith.
        Director, appreciated the conversation we had yesterday by
    phone. Thank you very much.
        In going through all of the information that I have
    received, I just want to make a few points, then I will ask my
    question.
        No. 1, it is what is said and what is not said. In going
    through the document, I realized that there is zero mention--I
    think Congressman Cline brought this up--zero mention of a debt
    crisis or an inflation crisis. Yet it mentions climate crisis
    over 33 times. The other--some of the other mentions that I
    have found interesting, it mentions tax fee or penalty 127
    times. It does not mention the Keystone Pipeline, nor does it
    mention--zero--any plans for new domestic oil and natural gas
    production, while it mentions 27 times green, greenhouse, and
    187 mentions of climate.
        Now, you have had a lot of questions today with regards to
    the price of gas, but again, I am going to back to just some of
    the other things.
        In this document there are zero mentions of border security
    in the budget--zero mentions. There are four mentions of
    police. Zero mentions of parents in the budget as well. So,
    again, just some things that I have observed as the newest
    person on this Committee that--the things that have been
    mentioned and the things that haven't.
        But question is going to be this, really simple, how does
    this budget spend for other countries to combat climate change?
        Ms. Young. We are making a historic investment, about $11
    billion, in our international climate pledge to ensure that
    low-income countries who do emit can join all of us in the
    developing world in bringing down their pollution so our kids,
    future generations, have an earth to call home.
        Mr. Carey. A followup to that, Mr. Chairman.
        What is the total level of funding provided, including tax
    incentives, for climate related policies in this budget?
        Ms. Young. Congressman, we devote about $45 billion in
    climate activities. I will get our exhibit to you. I don't want
    to misquote where we are in the budget, but I am happy to
    provide that on the record so you have specific numbers.
        Mr. Carey. One last thing. I am going to--wrote the
    question down to make sure I have so I say it correctly. The
    results of the provision--here it is--would any of the $30
    billion in mandatory spending to prevent--combat and prevent
    crime be used to enforce gun control on any of the U.S.
    citizens?
        Ms. Young. The idea--not on--the $30 billion pot is really
    supposed to be a comprehensive look and provide state and
    locals with the tools, and including psychiatrists, mental
    health. But we do have increases in ATF to make sure that ghost
    guns and other guns that find themselves into the hands of
    criminals, that we do something about that.
        Mr. Carey. Another question. How will spending $1.4 million
    on a new Office of Environmental Justice at DoJ help our law
    enforcement agencies do their job and tackle the crime crisis
    in America?
        Ms. Young. I think we have to tackle the crime crisis in
    America while we tackle an environmental justice system. I read
    in the New York Times, there is one county, I won't say what
    state, where people's sewage actually goes into their backyard.
    They have never had a sewage system at their homes. People of
    color, low-income. We think something is wrong with that.
        Mr. Carey. And that should be part of the law enforcement
    agencies?
        Ms. Young. Where there are illegal activities, DoJ
    absolutely needs the tools to make sure all Americans are
    treated equally under the law, even when there are
    environmental issues.
        Mr. Carey. OK. All right.
        Thank you, Director.
        Ms. Young. Thank you.
        Mr. Carey. You have answered my questions and I appreciate
    your time.
        Ms. Young. Appreciate it.
        Mr. Carey. I yield back.
        Chairman Yarmuth. The gentleman yields back.
        I now yield five minutes to the gentleman from Michigan,
    Mr. Kildee.
        Mr. Kildee. Thank you, Mr. Chairman. And thank you,
    Director Young, for being here today to discuss this budget
    proposal. And of course congratulations on your confirmation.
        You and I have talked about a couple of these issues I want
    to raise. I represent mid-Michigan. I do appreciate the focus
    of this proposal on infrastructure, on strengthening the middle
    class, on supporting law enforcement in particular, which is
    important in the communities that I represent, and for doing
    what we can to lower costs for families.
        I was, as I have expressed to you, disappointed that the
    budget request calls for funding the Flint Registry at a lower
    level than was passed in the most recent government funding
    legislation. And for those who are not familiar, the Flint
    Registry is run through the Centers for Disease Control and
    Prevention. It was created by Congress to respond to the water
    crisis in my hometown and to connect families to healthcare, to
    nutrition, to lead removal services, to do the things that they
    need to do to minimize the impact of lead exposure on their
    health. It is a powerful tool. It is improving the lives of
    people who suffer through this terrible moment. And it also
    helps other communities. Benton Harbor, Michigan, most
    recently, Newark, New Jersey.
        The Consolidated Appropriations Act of 2022, a bipartisan
    government funding bill, included $5 million in funding for the
    Registry. So the Michigan delegation, Democrats and
    Republicans, support this. And I just ask if the Administration
    will support fully funding the Flint Lead Registry so that we
    don't have to reduce that commitment that we are making to the
    families of Flint.
        Ms. Young. Absolutely, Mr. Kildee. And you have heard many
    times, we talk about the earliness in which we have to do
    things to get a budget to you.
        Mr. Kildee. Right.
        Ms. Young. I will say the Flint Registry was a result of
    that. We did not have time to incorporate many of the omnibus
    final decisions. We absolutely support. We talk about
    environmental justice, how can we support many environmental
    justice things without fully supporting Flint? And so you have
    my and the Administration's full support.
        Mr. Kildee. It is a--thank you for that. And it is a good
    example of when we invest in environmental justice, as you have
    in the proposed budget, perhaps we avoid the very high cost,
    both in human and financial costs, that the people of Flint
    have experienced.
        So thank you for that effort.
        One other issue that I do want to raise. And it has to do--
    and, again, you and I have spoken about this--the Delphi-
    salaried retirees. When GM filed for bankruptcy during the
    Great Recession, the PBGC unfairly, in the minds of myself and
    many others, cut as much as 70 percent for 20,000 Delphi-
    salaried retirees, more than 5,000 in Michigan. The PBGC
    assumed responsibility for the terminated benefits, but
    couldn't pay more than the statutory benefit would allow. These
    salaried workers suffered significant losses to their benefits.
    They were, I believe, unfairly targeted in the discharge of
    that bankruptcy.
        I have introduced legislation, the Susan Muffley Act, along
    with Senator Brown of Ohio. It is bipartisan legislation. It
    would restore the benefits to these retirees. A bankruptcy, by
    the way, which was largely engineered by the U.S. Government.
    So we do bear responsibility. These pensioners have been
    fighting for the restoration of their benefits for a long time.
    Can we work with you to ensure that Congress and the
    Administration together deliver the restoration of these hard
    earned benefits to the Delphi-salaried retirees?
        Ms. Young. Mr. Kildee, thank you for your long work on
    this. I have told you privately, I will tell you publicly, we
    are happy to take a look at the legislation. We want to work
    the Pension Benefit Guaranty Corporation, but we know those
    pensioners worked their entire careers and deserve their
    pensions. So we absolutely will work with you and provide
    whatever assistance we can.
        Mr. Kildee. I thank you for that.
        And, as we have discussed, I mean the Delphi-salaried
    retirees have exhausted other remedies and so that is why we
    are at this place where I think action by Congress is
    important. And we just want to be able to see the
    Administration as a partner in helping us get this resolution
    through to the President's desk.
        So I thank you for that and I thank you for your testimony
    and all the great work you are doing. Again, congratulations.
        Chairman Yarmuth. The gentleman's time has expired.
        I now yield five minutes to the gentleman from Wisconsin,
    Mr. Grothman.
        Mr. Grothman. Wow. Great. Thank you for coming over here.
    Not all of our witnesses nowadays come over and see us in
    person. So I would like to thank you for that.
        Ms. Young. Second year in a row, sir.
        Mr. Grothman. Very good.
        A comment before, I think there was a comment that the 17
    percent in AmeriCorps might not be quite enough. I will point
    out, given the current situation, nobody should ever get a 17
    percent, nobody should even get a 5 percent increase. So
    whatever. There is my comment.
        I recently was looking at some graphs and in them it showed
    that the--there are different measures of monetary supply, but
    M2 might not be the best measurement--but recently it has been
    up 40 percent year over year. And I am old enough to remember
    the inflation of the 1970's and at the time M2 was going up
    about 7 percent a year, and that was considered out of line. So
    I am just alarmed out of my mind that we have so much money
    apparently being printed by the Federal Reserve at this time.
    And, of course, one can try to blame it on something else, but
    I think clearly the inflation, which I think is well over 7
    percent--because when I talk to my farmers or talk to my
    manufacturers, their costs of production are frequently up 80-
    90 percent. So I can't help but think when their final product
    gets to market, it is going to be a lot more than 7 percent.
        But could you comment on the massive increase in the money
    supply? You think that might have something to do with
    inflation? And don't you believe with the relatively high
    spending in this budget that the money supply is going to go up
    even more, which mean inflation is going to go up more?
        Ms. Young. So, sir, you probably know this and it will be
    frustrating, but we leave monetary policy for the Fed for
    exactly the reason we don't want monetary policy to be subsumed
    in our great political process and it is outside of that
    process. So I will leave monetary policy for the Reserve and I
    am sure they--and they have the tools in which to manage most
    of our inflation crisis.
        But I have gone over what the President believes we can do
    from an Administration to deal with this. I would also point
    out many have talked about the ARP legislation. I sat with
    Moody's economists yesterday who truly believe that we would
    have seen a double-dip recession had it not been for ARP. But
    we may have different solutions, but we agree, we have to do
    something to bring down pressures on pocketbook issues for
    Americans.
        Mr. Grothman. I guess I would think, well, ultimately it is
    up to the Fed to make those decisions. When we pass budgets
    with sizable deficits, I think the Fed may feel they are in a
    corner and can't do anything else but print more money.
        But in any event, now, am I correct in looking at this
    budget that the non-defense discretionary spending--and I
    assume we are going to pass bills separate from the budget as
    well, or separate from the regular appropriations bills--is up
    about 12 percent?
        Ms. Young. From the omnibus it is up about 9.5 percent with
    defense up about 4 percent.
        Mr. Grothman. OK. You are saying--do you think given the
    huge amount of debt and the huge increase in the money supply
    that it is prudent to spend 10 percent--9.6 percent, on non-
    defense discretionary spending? Doesn't that alarm you? Or when
    you began to put this document together, what was your target
    number?
        Ms. Young. So remember, Mr. Grothman, the President is
    offering to pay for his proposals. So we are putting forth
    spending with tax reform. I get that many may disagree with our
    tax proposals, but he does believe we should pay for our
    proposals. And this budget we show over a trillion dollar
    decrease in the deficit. It is over 10 years.
        Mr. Grothman. OK. And what is it based on? A project
    inflation? A projected--because inflation determines kind of
    the--what type of inflation are you--or interest rates are you
    guessing when you put together the budget 10 years out?
        Ms. Young. So the inflation rates, or the interest----
        Mr. Grothman. I will say interest rates, yes.
        Ms. Young. The interest rates we are using now are lower
    than in the budget, because we did it in November--are about
    2.1 percent for this year. Right now I think we are really
    around 2.3. So we are slightly lower than interest rates. What
    we do believe over the 10-year period, we are still paying a
    lower interest rate than historic norms.
        Mr. Grothman. OK. I am going to ask you a little more of a
    bipartisan question. You are raising the corporate rate here to
    28 percent. And it is something I kind of disagree with the
    Republicans on. Historically, because we are in a worldwide
    competitive situation, we treated manufacturing a little bit
    different, because manufacturers have to compete with other
    businesses abroad and I think in a variety of ways we are
    seeing the problems that come when we are not competitive
    manufacturing with other countries.
        When--probably more likely have to be done with some bill
    through reconciliation, but would you be open to the idea that
    we go back to the old system in which manufacturing--and I
    think Barack Obama was in favor of this--I think Hillary was
    too--I might be wrong on that--that the tax rate for
    manufacturing would--since they have got to compete abroad--
    would be lower than the tax rate for other sort of businesses?
    Or there is some sort of credit for manufacturing?
        Chairman Yarmuth. The gentleman's time has expired.
        The witness may respond.
        Ms. Young. Thank you.
        Mr. Grothman, I really ask you to pay close attention to
    the global minimum tax proposal. You might have seen Secretary
    Yellen met with other countries to ensure exactly that, that
    people don't move a lot of these manufacturing bases to other
    countries who pay their workers less, have low or no tax rate.
    We believe that global minimum will help bring jobs back to the
    U.S.
        Chairman Yarmuth. The gentleman's time has expired.
        I now yield five minutes to the gentlewoman from Texas, Ms.
    Jackson Lee.
        Ms. Jackson Lee. Mr. Chairman, thank you so very much for
    the opportunity. Very, very important.
        Ms. Young, let me acknowledge that the nation is better off
    for the leadership of President Joe Biden and in fact your
    leadership and support in his efforts.
        Let me immediately start by headlines that I have heard
    from some of the papers that we read here on the Hill, and you
    are a Hill pro, that says that this is a--building the deficit
    and spending budget. And I take issue with that. First of all,
    would you comment on the alternative minimum tax, or the
    minimum tax as to what it actually does? As you well know, I
    have two or three questions and your brevity would help with
    that. But I just want to get to frame this particular aspect of
    the budget.
        Thank you.
        Ms. Young. I believe you are speaking of the billionaire
    minimum tax. Billionaires pay about 8 percent tax rate and
    other regular Americans, nurses, firefighters, teachers, pay at
    least double that. So we would like them to pay a minimum rate
    closer to what most Americans pay.
        Ms. Jackson Lee. So you are speaking about fairness and
    equity, if I can hear you correctly?
        Ms. Young. That is correct.
        Ms. Jackson Lee. What will it do for the budget? The
    revenue that may come in?
        Ms. Young. Thank you for that. That is why this budget is
    deficit reducing. So we are looking to reduce the deficit, are
    on track to reduce the deficit $1.3 trillion this year, and
    reduce even further by over a trillion dollars with these
    policies.
        Ms. Jackson Lee. Thank you so very much.
        Mr. Chairman, I want to introduce in the record a childcare
    need under the 2019 Texas Childcare Facts that is produced by
    Child Aware. I ask unanimous consent to place it in the record.
        Chairman Yarmuth. Without objection.
        [Report submitted for the record follows:]

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        Ms. Jackson Lee. In my state there are about a 1,812,000
    families in poverty, but here is the big number--children under
    six, 1,372,687 who are needing childcare. Let me briefly
    comment on the investment you made, $7.6 billion in
    discretionary funding for childcare and development block
    grant. Tell me it will get to the children in Texas, one
    million of them under six needing childcare.
        Ms. Young. Not only do we support that amount, the $7.6
    billion, as you talked about. It will go to the states to help
    a lot of childcare businesses. As you know, during the pandemic
    many couldn't keep their doors open. So families, especially
    women, are finding they can't reenter the work force. And we
    have to do something about that.
        Ms. Jackson Lee. So a clarion call to my constituents in
    Houston who are part of the 1.6 million children needing
    childcare, this may enhance their opportunity and their
    opportunity for women to get back into the work force?
        Ms. Young. That. And, Congresswoman, I would also point
    that the President has been supportive of childcare as part of
    further legislation still under consideration. This would be
    one part of it.
        Ms. Jackson Lee. Absolutely, we support that to ensure a 7
    percent cap on any family's childcare cost.
        Let me just thank the Administration quickly for its COVID
    action. Unlike the awkward and unprepared of the last
    Administration. You have a $11.6 billion as it deals with the
    pandemic and public health preparedness. How important is that?
    As my time runs out and I have got a few more questions.
        Ms. Young. So that looks at future pandemics so we aren't
    left in the same predicament we were if another pandemic were
    to occur. We need to invest in future pandemics.
        Ms. Jackson Lee. Thank you. That is going to go a long way
    to rural hospitals, local urban hospitals, and others dealing
    with pandemic increases that may come in the near future.
        I chair the Crime Subcommittee on Judiciary. Very
    interested in the question of reduction of crime. That would
    include enhancing training or responses to law enforcement, but
    more importantly as well, the complementary support of mental
    health support, support to stem the tide of domestic violence.
    What is the Administration doing on that? Very quickly.
        Ms. Young. The budget will propose $56 million to issue
    grants to support behavioral health services to individuals
    within or during reentry from jails and prisons. Also asking
    for $500 million to be split between DoJ and HHS, with the
    recognition that there has to be a comprehensive answer to
    crime, not just from the law enforcement standpoint.
        Ms. Jackson Lee. Well, the one thing we know is that the
    Administration and Democrats are not soft on crime and that we
    recognize we must be in the crime reducing business.
        I want to thank you for your support of public housing. And
    so my final questions are public housing emphasis and then the
    commitment of the Administration for taking refugees from
    Ukraine under the present capping that we have not utilized.
        I would appreciate your answers to those two questions.
        Ms. Young. As you know, we have a robust housing supply
    initiative, $50 billion on the mandatory side to ensure we have
    affordable housing. Also, as you point out, the budget provides
    funding to resettle 125,000 refugees in 2023, including the
    commitment for Ukrainians that the President recently
    announced.
        Ms. Jackson Lee. I look forward to working with you on
    these matter.
        And, Mr. Chairman, thank you so very much. This is a
    robust, important budget for the American people and it is a
    deficit busting budget and we need to move forward on the
    President's goals.
        Thank you so very much for your leadership.
        I yield back.
        Chairman Yarmuth. The gentlewoman's time has expired.
        Now I yield five minutes to the gentleman from California,
    Mr. Obernolte.
        Mr. Obernolte. Thank you, Mr. Chair. And, Director Young,
    congratulations on your confirmation. Thank you for the
    introductory phone call. It was very nice getting to know you.
    I am certainly looking forward to working with you.
        So I would like to continue a line of questioning that a
    number of the other Members of the panel have raised about the
    assumptions that were made on the rate of inflation when the
    budget was created. So my understanding is that the rate of
    inflation that was assumed for this year is 4.7 percent.
    Obviously we are trending toward nearly twice that. And for the
    rest of the budgetary forecast, it was 2.3 percent, which I
    think the Federal Reserve and most every economist would agree
    is going to be substantially more than that. And you have
    explained that that was because the budget was crafted in
    November before the recent spike in inflation.
        Do I have all that right?
        Ms. Young. That is correct.
        Mr. Obernolte. So I am curious as to--because I am hopeful,
    Mr. Chairman, as Members of this panel on both sides of the
    aisle, I am hopeful that we can actually do what Congress is
    meant to do, take this budget and craft an actual budget
    proposal out of it and pass that budget. So we have to rely on
    the figures that you are giving us and try and craft our own
    budget out of that.
        What changes do you think the fact that the assumptions
    that you made about inflation when you crafted the budget were
    incorrect, what effect do you think that has on the numbers in
    the budget?
        Ms. Young. As I mentioned earlier, inflation has an
    offsetting mechanism. So typically with higher inflation
    revenues are also higher. So we believe our debt and deficit
    targets remain about the same.
        I would also point out it is a 10 year budget. Our long-
    term inflation numbers are still in line with private
    forecasters. And I point out the word forecasters. Just like
    the government forecast estimates, so do the private markets.
    And the long-term estimates are still in line with those
    private forecasters.
        Mr. Obernolte. OK. So the Department of Labor just recently
    came out with statistics showing that real wage growth is
    actually negative by 2.5 percent right now. And the
    Congressional Budget Office says that that actually is going to
    have--as inflation goes up, that has a negative effect on
    budgets because although revenues go up, they don't go up
    enough to compensate for higher expenses. And as the interest
    rates rise, a greater percent of the budget has to be spent on
    debt service.
        So would you say that given the fact that actual inflation
    is running about twice what the assumption was, would you say
    that the long-term deficit reduction is going to be the same?
        Ms. Young. It will be about the same. But you are right,
    the more interest rates, not inflation, goes up--I was speaking
    to inflation. On interest rates, you are right, that does have
    an impact on what you pay in debt service. We also look at what
    the historical rates are and what we pay on the debt. Based on
    historical averages, we are still in line to--we are paying
    less tha historical norms on debt service and even with higher
    interest rates--by the way, Mr. Obernolte, our budget does
    account for--we account for interest rates growing in this
    budget.
        Mr. Obernolte. Well, I think we all join you in hoping that
    the rate that we have to pay on our national debt does not go
    up substantially. But, you know, pessimistically, I am not sure
    that that is going to be the case.
        So long-term, I was very happy to see the President
    concentrating on deficit reduction. It certainly was not the
    case with his proposed budget last year. That is a concern that
    many of us on this panel have. One of the things that you
    touted in your opening statement about the budget is that it is
    going to reduce the deficit by over a trillion dollars over the
    forecasting period. But I wanted to be clear, you are talking
    about cumulatively? Because our deficit is about $1.3 trillion
    right now. So we are not going to reduce it to--from $1.3 to
    .3, we are going to reduce it by a trillion over that 10 year
    forecast period.
        Ms. Young. So there are two deficit numbers I talked about,
    and they are important to get right. We are on track, absent
    this budget, to reduce the deficit by $1.3 trillion year over
    year. The largest ever decline in one year. The budget policies
    represent, if Congress takes them up, we believe another $1
    trillion in deficit reduction.
        Mr. Obernolte. Total over the 10 year period?
        Ms. Young. Correct.
        Mr. Obernolte. So I mean $100 billion a year, not a
    trillion in a single year?
        Ms. Young. Right. The cumulative effect.
        Mr. Obernolte. We are still going to have a substantial
    deficit by the end of the forecast period.
        Ms. Young. But remember, we are also looking at bringing
    down the deficit $1.3 trillion in one year.
        Mr. Obernolte. We on the same team here.
        Well, let me ask you about that actually, as kind of a
    final question here. As I said, I was very encouraged to see
    the President focusing on deficit reduction. What, as Director
    of the OMB, what is your long-term philosophy on that? Do you
    think that we need to get to a balanced budget? And if so, how
    do we do that?
        Ms. Young. Mr. Obernolte, I think, and a lot of economists
    think, that a better measure to look at than to try to get to
    zero debt, because you know this, the most spending in this
    budget is our beneficiaries, to Social Security, to Medicare,
    and to ensure that we preserve those benefits for our elderly
    or those close to, to make sure that they get those benefits,
    we believe the more appropriate thing to do is look at whether
    the debt level is crowding out the country's ability to make
    investments. We don't think we are at that point. There is not
    a specific number that makes sense. You can't just say $60
    trillion gets to be too much, or $40 or $50, it really is
    depending on the size of the economy. And we believe we can
    handle the debt service payments given that interest rates
    remain historically low even if rising.
        Mr. Obernolte. Well, on that we might disagree, but I see
    my time is expired.
        I yield back. Thank you very much.
        Chairman Yarmuth. The gentleman's time has expired.
        Ms. Young. And he has been here a long time, so thank you,
    Mr. Chairman.
        Chairman Yarmuth. Yes, he has been.
        I now yield five minutes to the gentlewoman from Colorado,
    Ms. Boebert.
        Ms. Boebert. Thank you, Mr. Chairman. And, Director Young,
    thank you so much for being here today.
        I just want to start off with a few quick questions.
        First of all, what is the current national debt?
        Ms. Young. The current debt is about $24 trillion.
        Ms. Boebert. OK. I have about $30 trillion. How much would
    each American citizen have to pay to cover that debt?
        Ms. Young. That is not how debts work, so we have not
    calculated that.
        Ms. Boebert. I reclaim my time. Director, the answer is
    $91,207 per American citizen. How much does each taxpayer--
    thank you--how much does each taxpayer owe to cover our current
    $30 trillion debt, not $24 trillion?
        Ms. Young. And I am sorry, I have $22.3, so I will correct
    myself downward, since we are using different numbers. Again,
    we don't calculate the debt by person, including my 5-month
    old. Thank you.
        Ms. Boebert. Reclaim my time. Excuse me, Director, the
    answer is $242,500 per taxpayer in America.
        Now you may have been on track with some of these answers
    if your numbers were correct with the $30 trillion debt that we
    actually are at right now. But I would have hoped that you
    would have the correct answers in your position to all of these
    questions as the President and this regime really should keep
    this debt at the forefront of our thinking and proposing a
    budget. But this budget that was created has proposed to spend
    another $5.8 trillion this Fiscal Year and $73 trillion over
    the next 10 years. And, sadly, it is pretty apparent that you
    were more concerned with continuing to spend trillions of
    dollars of taxpayer money on liberal wish lists rather than
    doing anything substantive to reign in wasteful federal
    government spending.
        Now, I have said multiple times the federal government does
    not have a revenue problem, it has a spending problem.
        Now, Director Young, Biden likes to say show me your budget
    and I will tell you your values. So let us see what Democrats
    really value. The word military appears 26 times in this
    budget, but gender, it is used 43 times in your budget. Equity,
    well that is use 75 times and climate is used 187 times in this
    budget. And Americans sure do understand what Democrat
    priorities are and their values. They know that the real cost
    of these woke policies and so called values are impacting them
    and the bill has come due for these bad Democrat policies.
        Proposing to spend trillions of dollars on more woke wants
    not needs is absolutely shameful. And really you should be
    embarrassed to be testifying today and trying to defend this
    $5.8 trillion budget.
        Now, during the State of the Union Joe Biden said that his
    plan to fight inflation was for businesses to simply lower
    their costs, not their wages. Director Young, I am a small
    business owner, and I can tell you that that is not how it
    works in the real world. I understand that we use Washington,
    DC. math here, but that is not how it works for real small
    business owners. Meat is up 13 percent, milk is up almost 12
    percent, electricity is up 9 percent.
        Now, as a restaurant owner, how am I supposed to lower my
    costs if everything that I use is going up? And I certainly
    wouldn't be able to pay employees higher wages.
        So, with this skyrocketing inflation that is taking place,
    Madam Director, can you please simply describe to me, define to
    me, what inflation is?
        Ms. Young. Sure. The cost of goods are more expensive. It
    costs more for the same goods than it did last year. The
    President is very aware of that. That is why he called on
    Congress to send him legislation----
        Ms. Boebert. Reclaiming my time. Thank you.
        Ms. Young [continuing]. that reduced cost of healthcare.
        Ms. Boebert. Thank you, Director. That is not exactly what
    I was getting at. Let me answer this for you. So Milton
    Friedman, who won the Nobel Prize in economics, said that
    inflation comes from too much money being printed in D.C.
    Specifically, and I quote, he said ``Inflation is a result of
    too much money and more rapid increase in the quantity of money
    than in output. Moreover, in the modern era, the important next
    step to recognize that today governments control the quantity
    of money so that as a result inflation in the United States is
    made in Washington and nowhere else.''
        So, Director Young, in short, inflation comes from
    Washington, DC. where the products we use aren't created, but
    the products we use are made more expensive.
        Director Young, shamefully this Biden budget proposes the
    largest tax increase in American history and I really think
    that that bears repeating. It is the largest in American
    history. The Biden regime either has no concept of how
    inflation is impacting Americans or simply has no concept for
    Americans who find the cost of gasoline too expensive because,
    after all, they can't just go buy a Tesla.
        How about that for Democrat priorities?
        Thank you, Madam Director.
        Chairman Yarmuth. The gentlewoman's time has expired.
        I think I am the last questioner and I now yield myself 10
    minutes.
        First of all, let me say thank you for being here, Director
    Young. I think you have more than justified the judgment of the
    President to name you to this position and the Senate's wisdom
    in confirming you.
        I love going last because it is like cleanup on aisle six.
    I get to deal with a lot of the things that have been said and
    messed up.
        Now, I want to start with Mr. Donalds' comment about
    raising the corporate tax rate. He said if you raise the
    corporate tax rate that it is going to cause inflation because
    you are going to--they are going to pass it along to consumers.
    That would imply that if you lowered the tax rate that they
    would pass the savings onto consumers. When Republicans cut the
    tax rate from 35 to 21 percent in 2017, did that result in any
    cost cutting for consumers that you are aware of?
        Ms. Young. It did not.
        Chairman Yarmuth. Right. As a matter of fact, if that were
    true, we wouldn't have the inflation we have now because they
    are still paying at a 21 percent rate. So that just doesn't
    make sense. And you were here in 2017, you were in the
    Congress, and the justification Republicans gave at that time
    for cutting the corporate tax rate was that this would
    encourage them to invest new equipment, new capacity, new
    productivity. Did any of that happen?
        Ms. Young. It did not.
        Chairman Yarmuth. No, as a matter of fact most of the money
    that was saved by lowering the tax rate was spent on buying
    back stock and increasing dividends, not in actually being
    reinvested in their businesses.
        Let us talk about gas prices for a minute. How are gas
    prices set? What are they dependent upon?
        Ms. Young. They are dependent upon the market.
        Chairman Yarmuth. Right. And it is a global market, gas is
    produced all over the world. And when there is higher demand
    for less gas, prices go up and conversely when there is less
    demand and too much gas, prices go down. I think it was the
    Ranking Member--it may not have been. I apologize if I didn't
    get you right--that said back several years ago you found--
    somebody found gas at $.90 a gallon. And was that during a
    period when the government was shut down--I mean the country
    was shut down, not the government. The country was essentially
    was shut down and nobody was driving.
        Ms. Young. Right.
        Chairman Yarmuth. Yes, so prices are naturally going to be
    lower. And now as the economy is recovering, part of the
    reason--forget--in the last month or so, which I think we can
    consider an aberration, we saw a much greater demand for
    gasoline. Prices went up to a level that basically we have seen
    before. We saw that level in 2011, 1912, 1913, 1914, and into
    the Bush Administration when gasoline prices were much higher
    than they were in 2020 and 2021.
        When--well, you mentioned I think, but I--the annual
    production now of gasoline in the United States, the number I
    saw, which I mentioned last week or two weeks ago, was 12.1
    million gallons a day. Russia produces about 10 \1/2\ million
    barrels a day and Saudi Arabia 8 \1/2\ million barrels a day.
    There is no country on earth that produces as much oil as we
    are producing right now. So is it fair to say that anything
    that the Biden Administration has proposed or implemented has
    had anything to do--has had the impact of reducing oil
    production in the country?
        Ms. Young. Absolutely not.
        Chairman Yarmuth. Right. And the Keystone Pipeline keeps
    coming up. The Keystone Pipeline, if it were resumed--if they
    resumed construction of the Keystone Pipeline today, how long
    would it be before the Keystone Pipeline was finished?
        Ms. Young. Not in any time to deal with any of the
    increases we are seeing now.
        Chairman Yarmuth. I think the estimate is 11 years from
    now. And somebody mentioned that that was oil that was going to
    be used in the United States. Is that correct?
        Ms. Young. I don't believe that is correct. And you pointed
    to oil production here. Most is shipped other places and not
    kept here.
        Chairman Yarmuth. Exactly.
        Let us talk about the Defense Department budget for a
    minute. A statement has been made, you know--and I know a lot
    of Republicans are calling for 5 percent in addition to
    inflation. Does inflation--the figure that we see now, 7.9
    percent on an annual rate, does inflation affect every entity
    the same way?
        Ms. Young. It does not.
        Chairman Yarmuth. So if you were in the Pentagon and you
    are using a lot of gasoline, you probably are not going to the
    pump every day and filling up the tanks and the jeeps and those
    things. You make contracts for that gasoline, don't you?
        Ms. Young. That is correct. And you typically lock in a
    price.
        Chairman Yarmuth. Exactly. And so to say that we
    automatically have to assume that the Defense Department is
    going to be--their costs are going to go up 7.9 percent isn't
    based on the way things actually work.
        Ms. Young. We don't believe--we believe this is a real
    increase.
        Chairman Yarmuth. Right. And one of the things that you are
    proposing is a 4.6 percent increase in the salary of military
    personnel.
        Ms. Young. Military and civilians.
        Chairman Yarmuth. Civilians. Which actually does kind of
    accommodate the inflation that those military families are
    experiencing.
        Ms. Young. It is a part of the formula actually that
    developed the 4.6.
        Chairman Yarmuth. Right. So when the Defense Department
    analysts were drawing up their budget request, they didn't say
    that inflation didn't exist, did they?
        Ms. Young. That is right. And I would like to point out,
    unlike I think some relationships--some may have heard between
    OMB and the Department--OMB and the Department of Defense
    worked closely hand in hand. And I think the Secretary of
    Defense would tell you this is the budget he needs to have a
    ready military.
        Chairman Yarmuth. Again going back to gas prices for a
    second, one of the things that came up earlier is a mention of
    the equity of favoring support for gasoline prices versus
    support for environmentally beneficial energy sources. And the
    question was asked, do you think that is fair. Well, personally
    I think it is very fair. I mean I think as a country there is
    broad consensus that we need to be moving away from fossil
    fuels toward renewables and other clean energy sources.
        But I remember in--and you may--I remember when George
    Bush--George W. Bush was president and he said that once
    gasoline prices get higher than $55 a barrel, that there is no
    need for incentives for producers to produce. Do you remember
    that comment?
        Ms. Young. I do not.
        Chairman Yarmuth. Well, he did. That is getting back a
    little ways. But--and gasoline right now--oil is double that
    amount.
        Ms. Young. Yes.
        Chairman Yarmuth. Basically $110-$115 a barrel. So
    according to the man from the biggest oil producing state in
    the country, I would say they are not necessary at this point.
        Talking about the American Rescue Plan. And I know--I think
    the Ranking Member said that until the American Rescue Plan was
    enacted, job growth was performing at a lower rate than had
    been projected. Is that a fair characterization? You didn't say
    that? OK. Well, you said the first few months of the Biden
    Administration job growth was not performing as the projections
    were. And that was the reason--one of the reasons we passed the
    American Rescue Plan, to stimulate the economy to help people
    get back on their feet. And the fact that we created 6 million
    jobs after that in 2021 is pretty good evidence that the
    American Rescue Plan was successful.
        Ms. Young. I mean as I mentioned earlier, I sat with Mark
    Zandi from Moody's yesterday who believes we would have ended
    up in a double-dip recession had it not been for ARP. So not
    only did that not happen and we are not seeing the scarring we
    saw after the Great Recession, which took four years to recover
    from, we are seeing record growth out of the pandemic.
        Chairman Yarmuth. And since you mentioned Moody's, a lot of
    people on the Republican side, none of whom voted for the
    American Rescue Plan, are trying to lay the 7.9 inflation rate
    on the money that flowed from the American Rescue Plan. Moody's
    made an analysis that said that the American Rescue Plan was
    responsible for less than 1 percent of that inflation rate. Did
    they reiterate that to you?
        Ms. Young. They did.
        Chairman Yarmuth. Do you have any analysis that would
    contradict them?
        Ms. Young. I do not.
        Chairman Yarmuth. And the Federal Reserve in San Francisco
    did a similar analysis and came up with the same result.
        I think I am almost done.
        One question I do have in my 30 seconds left. In
    considering tax reform, one of the things that a lot of people,
    including myself, think would be very important and useful and
    justifiable, is to increase the carried interest rate. You
    don't do that. None of my colleagues--well, at least the
    leadership of the Ways and Means Committee has not proposed to
    do that. Is that something the Administration has considered
    and why has it decided not to approach that, if it--they have
    considered it?
        Ms. Young. Mr. Chairman, I am happy to talk to you about
    that proposal. I think Treasury is our lead on tax proposals,
    but I think it is a worthy conversation and I am happy to take
    that offline and have a real conversation about it and tell you
    if there are concerns what they are.
        Chairman Yarmuth. OK. I would love to hear that.
        Well, so I am over my time by 20 seconds, but I have been
    pretty generous most of the day, so I don't feel guilty about
    that. But once again thank you for your spending so much time
    with us. Thank you for your responses, thank you for your work,
    and once again we look forward to continuing to work with OMB
    as we move forward in this process.
        Unless there----
        Ms. Young. Thank you so much.
        Chairman Yarmuth. Thanks.
        Unless there is any further business, this hearing is
    adjourned.
        [Whereupon, at 1:45 p.m., the Committee was adjourned.]

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