Go Ahead, Biden. Borrow Away for Your Plans.

President Joe Biden hopes to spend $4.1 trillion on infrastructure, education and various social programs, efforts we think are worthwhile. We believe it’s a necessary investment in physical and intellectual capital that will make the U.S. more competitive, and Americans more prosperous, in the decades ahead, as we argued in a column on Wednesday.

Now the question is how to pay for it. The administration wants to finance it by raising taxes on companies and high-earners. But with long-term U.S. interest rates at historic lows, a record surge of cash in circulation and many Americans flush with savings accumulated during the pandemic, the federal government also has access to a trove of cheap money. Given that unusual opportunity, and the opposition higher taxes are likely to generate among some moderate Democrats and many Republicans, we think Congress should primarily borrow the money needed for Biden’s plans.