Biden's $1.7 Trillion Deficit Boast to Democrats: 'We Paid for Everything We Did' (February 3, 2023)

President Biden told a cheering Democratic crowd in Philadelphia on Feb. 3, 2023, that “we paid for everything we did,” and that “unlike Republicans, we cut the deficit $1.7 trillion in 2 years.” Budget watchdogs said the drop came from emergency COVID spending running out, and that Biden’s own policies had added trillions to future deficits.

Biden made the boast at the Democratic National Committee’s winter meeting at the Sheraton Philadelphia Downtown, four days before he repeated the deficit claim in his State of the Union address [1][2]. The video above shows the line. Quotes are from the official White House transcript, published by the American Presidency Project.

”We Paid for Everything We Did”

Biden was running through his first-term record when he got to the money. “We’ve got a lot more to do. And by the way—by the way, we paid for everything we did,” he said [1].

“And unlike Republicans, we cut the deficit $1.7 trillion in 2 years. You know how we did it? We said, ‘You know, the superwealthy maybe should pay a little bit.’” The line drew laughter. “And it ain’t even close yet. I intend to get it done—more done,” Biden added [1].

Later in the speech he went after the new House Republican majority, saying it “campaigned on fiscal responsibility” while its first bill “added $114 billion to the deficit.” HYGO News examined those attacks, and his gas-price claim, in a separate report on the speech [1].

The Math Behind the $1.7 Trillion

The number itself is real. The annual deficit fell from $3.1 trillion in fiscal year 2020 to $1.4 trillion in fiscal 2022, a drop of $1.7 trillion, Fox News reported in a roundup of fact checks [3].

But fiscal 2020, which ended Sept. 30, 2020, was a Trump-era pandemic year, and Biden took office in January 2021. Measured from his first year, the deficit fell from $2.8 trillion in fiscal 2021 to $1.4 trillion in fiscal 2022, according to the Committee for a Responsible Federal Budget [4].

The Biden Treasury put the best face on it. Treasury Secretary Janet Yellen and budget director Shalanda Young said the fiscal 2022 deficit of $1.375 trillion “was half of the FY 2021 deficit” and called the drop “the largest one-year decrease in the Federal deficit in American history” [5].

Where the Drop Really Came From

The Committee for a Responsible Federal Budget, a fiscal watchdog group, said the White House was taking credit for something it did not do. “While the Biden Administration has tried to take credit for this ‘historic deficit reduction,’ the fall can be more than fully explained by expiring COVID relief,” the group wrote in October 2022 [4].

By its count, the waning of one-time COVID relief explained roughly $1.45 trillion, or 104%, of the fiscal 2022 drop. That included most of a $359 billion fall in unemployment benefits and a $300 billion drop in Small Business Administration spending, mostly the Paycheck Protection Program [4].

The fact checkers agreed. “Biden misleadingly claims to have lowered the deficit by a huge amount even though his policies have added significantly to the national debt,” wrote Glenn Kessler of The Washington Post, as quoted by Fox News [3].

The Congressional Budget Office had projected in February 2021, before Biden signed any fiscal legislation, that deficits would plunge as pandemic spending lapsed, Fox News reported. CBO expected combined deficits of $3.31 trillion for 2021 and 2022. The actual total came to $4.15 trillion, about $840 billion more than expected [3].

”He Was There While It Happened”

Even before the Philadelphia speech, budget experts had pushed back on the White House talking point. In May 2022, former CBO Director Douglas Holtz-Eakin told Fox News Digital that the expiration of the CARES Act, and the fact that there was not another American Rescue Plan, made the deficit look much smaller [9].

“He didn’t really do anything, he was there while it happened,” Holtz-Eakin said. The administration had not pushed through a big tax increase or $400 billion of spending cuts, he said: “They’ve done neither” [9].

The current CBO director, Phillip Swagel, was more diplomatic. He told Fox News Digital the deficit was falling “in part because there was immense emergency spending during the pandemic, and that spending is ending,” and because tax revenues had come back with the economy [9].

A Line on Repeat

Biden kept using the number. Four days after Philadelphia, he told Congress in his State of the Union address: “In the last 2 years, my administration has cut the deficit by more than $1.7 trillion, the largest deficit reduction in American history” [2].

He said it again at a union training center in Accokeek, Maryland, on April 19, 2023: “In my first 2 years in office, I brought the deficit down by a record $1.7 trillion” [10].

”Paid for Everything”?

Biden’s claim that Democrats paid for everything is harder to square with the record.

COVID relief: The 2021 COVID relief law was estimated to add nearly $1.9 trillion to the deficit over 10 years, Fox News reported [3].
Student debt: The fiscal 2022 deficit included the $380 billion cost of Biden’s plan to cancel $10,000 to $20,000 of student debt per borrower. Without it, the deficit would have been roughly $1 trillion, the Committee for a Responsible Federal Budget said [4].
The bottom line: “In fact, the president’s actions to date have increased deficits by $4.8 trillion through 2031,” the committee wrote, in a passage quoted by Fox News [3].

The White House stood by its record. In October 2024, Young said the administration had “lowered the deficit” while “ensuring the wealthiest among us and large corporations pay their fair share and cutting wasteful spending on special interests” [6].

By the Numbers

$3.1 trillion: The fiscal 2020 deficit, the starting point for Biden’s $1.7 trillion claim [3].
$2.8 trillion: The fiscal 2021 deficit, Biden’s first year in office [4].
$1.375 trillion: The fiscal 2022 deficit [5].
104%: The share of the 2022 deficit drop that the Committee for a Responsible Federal Budget attributed to expiring COVID relief [4].
$4.8 trillion: The committee’s estimate of how much Biden’s actions had added to deficits through 2031 [3].

What Happened Next

The deficit went back up.

Fiscal 2023: The deficit climbed to $1.7 trillion, $320 billion more than the year before, Treasury reported [7]. Treasury said the year’s figures reflected the Supreme Court’s decision in Biden v. Nebraska on Biden’s student loan program [7]. Excluding that student loan modification, Treasury’s own tables put the fiscal 2023 deficit at $2.029 trillion [6].

Fiscal 2024: The deficit hit $1.833 trillion, $138 billion higher than in 2023. Interest on the public debt was up $254 billion, or 29%, from the year before, excluding the student loan effects [6].

Fiscal 2025: In the budget year that began under Biden in October 2024 and ended under President Trump in September 2025, Washington borrowed $1.8 trillion, roughly the same as the year before, despite an extra $118 billion of tariff revenue, the Committee for a Responsible Federal Budget said [8].

Some of Biden’s plans to make the superwealthy “pay a little bit” more never passed. His proposals to raise the top income tax rate and increase the Medicare tax on people earning more than $400,000 remained unenacted when the 2024 results were published [6].