What does it mean for a service or good to cost zero dollars? This was once a straightforward question: if you paid nothing for it, it was free. But “free” has apparently been redefined. In case you thought the days of triggering presidential tweets were behind us, the White House tweeted over the weekend: “The cost of the Build Back Better Agenda is $0. The President’s plan won’t add to our national deficit and no one making under $400,000 per year will see their taxes go up a single penny. It’s fully paid for by ensuring big corporations and the very wealthy pay their fair share.”

The argument here, such as it is, is that Democrats’ ambitious reconciliation bill, originally slated to contain $3.5 trillion in federal spending over ten years, won’t cost anything—because it will be paid for with taxes on high earners and corporations and by taking money from other places in the budget. This is absurd: if you buy a car with cash instead of a loan, it still costs more than zero. Money spent on free community college is money not being spent somewhere else; low interest rates or not, we still live in a world of finite resources.

The White House’s assertion of the bill’s cost is not credible. Even the original $3.5 trillion figure (now getting negotiated down) assumed that the bill’s supposedly critical new programs—a child allowance, pre-K, and dental care—will last only for a few years. For example, the proposal to expand Medicare to cover dental benefits isn’t set to kick in until 2028. And the budget projections extend only ten years, thus assuming that these benefits will eventually expire.

Without these accounting gimmicks, the free lunch suddenly looks more expensive. This isn’t building a bridge while interest rates are low; Build Back Better aims to introduce ongoing entitlements that will be funded even if rates go up or the economy stumbles. Eventually, the government will need lots of tax revenue to pay for it—and corporations and high earners will respond to higher taxes the way they always do. If we want a European-size welfare state, we’ll need to pay European-size taxes, and that includes low and middle earners.

Bigger government doesn’t just mean higher direct taxes. Taking money from high earners and corporations is not costless. Corporate taxes are borne, at least partially, by workers (via lower wages) and by consumers (via higher prices). A bigger government presence in the economy can mean a less dynamic economy with less investment and innovation, as well as slower improvement to our standard of living. Social spending also risks worsening inflation, hurting low earners who live on tight budgets.

For Build Back Better, size is the point. The individual programs may appear popular at first glance, but how they are implemented has gotten less attention. A healthy and transparent debate about how to spend our resources, what programs we want and need, the proper size of government, and the trade-offs involved in social policy would not make Build Back Better more popular. The Biden administration seems to get this—so rather than reckon with Americans about the true nature of its agenda, the White House is choosing deception.

Photo by BRENDAN SMIALOWSKI/AFP via Getty Images

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