by The Daily Signal | Updated on 3.12.19
This piece was authored by The Daily Signal, and its content solely reflects the published views of The Daily Signal and its journalists.
Budget season is officially upon us.
On Monday, President Donald Trump released a preliminary sketch of his fiscal year 2020 budget proposal. The outline reflects a good first step toward restoring fiscal sustainability. It would cut spending by trillions of dollars and rejects the notion that another massive budget cap-lifting deal is essential to provide for national defense.
Yet much more is needed if the U.S. is going to stave off a future budget meltdown. Trump’s proposal would fail to reach balance in 10 years and would do little to address unsustainable entitlement programs, which are driving much of the budget’s projected long-term spending growth.
The bottom line is that absent economically destructive tax increases, without fundamentally reforming Social Security, Medicare, and Medicaid, it will be impossible to achieve a sustainable budget over the long term.
The document released Monday is just a preview of what’s in the president’s full budget proposal, which will be released March 18. Here’s what we know so far.
Like the fiscal year 2019 budget, this budget proposal would not balance within the 10-year budget window. Yet the administration projects that it would reach surplus by 2034. In total, it would cut spending by $2.7 trillion over the next decade.
Of the $2.7 trillion in spending cuts, $2.1 trillion of the savings would come from cuts to mandatory programs. But concerningly, only 24 percent of these cuts would be implemented during the first five years of the budget window.
Taxpayers would be better served if reforms took place immediately, not years down the road.
Under the president’s budget, deficit and debt levels would start to decline. After reaching a deficit of $1.1 trillion in 2021, the deficit would decline to $202 billion by 2029. The administration projects that debt held by the public will rise by $7.5 trillion over the next decade, but will decrease as a share of the economy from 79.5 percent to 71.3 percent.
Perhaps the most interesting part of the president’s fiscal year 2020 budget is how it could shape the debate over the future of the Budget Control Act spending caps. The caps are set to run through 2021, yet some lawmakers are already pushing for another two-year deal to increase the limits.
The president’s treatment of the budget caps this year stands in contrast to his previous two budgets. Both the 2018 and 2019 budget proposals would have eliminated the firewall between defense and non-defense spending, creating one overall cap on discretionary spending. This allowed the administration to prioritize defense spending without breaking the total spending limit.
In both the president’s previous budgets, every dollar increase in defense spending was equally paid for by a cut to non-defense programs.
The fiscal year 2020 budget takes a different approach. The president’s proposal would maintain both the defense and non-defense caps put in place by the Budget Control Act. That means that in 2020, base defense funding would be $71 billion below fiscal year 2019 levels.
To compensate for this, the budget calls for a cap-exempt Overseas Contingency Operations adjustment of $174 billion—a backdoor way of raising defense spending. Trump’s proposal would follow the same approach in 2021, proposing $156 billion in Overseas Contingency Operations funds that year.
Under the Budget Control Act, non-defense spending is currently set to fall from $597 billion to $543 billion in 2020.. The president’s budget calls for a non-defense cut of 4.6 percent, which would save $27 billion compared to current law. Yet the administration assumes the enactment of a rescissions package and budgetary gimmick savings through Changes in Mandatory Programs to further reduce non-defense spending to the Budget Control Act level.
The president should be commended for wanting to properly fund the military while staying within the budget caps, but the way this budget does it is not ideal.
The president should follow his previous two proposals and propose eliminating the firewall between defense and non-defense spending. This would force Congress to focus on its constitutional obligations, like ensuring a strong national defense, without breaking the budget caps.
It is possible to fully fund the military while reducing spending and cutting taxes. The Heritage Foundation’s Blueprint for Balance illustrates a path to do just that. There is no reason to use Overseas Contingency Operations funding as a gimmick to evade the spending caps any more than there is a need for another deficit-increasing budget deal.
Budget observers are anxiously awaiting next week’s full release of the president’s budget. As is so often the case, the devil is in the details, and more information will be needed to fully understand the implications of this proposal.
But one thing is already clear: While the president’s budget would make progress on controlling spending and reducing the national debt, there is much work yet to be done.
It’s now up to the president and Congress to work together and find a responsible path forward that cuts spending, reduces the national debt, and ensures economic prosperity and opportunity for all Americans.
The post Trump’s Budget Would Chip Away at the Debt, but More Work Still Needed appeared first on The Daily Signal.
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He wants to cut funding for the neediest Americans and has cut taxes for the richest. If you can't see that this is as far from "for the People" as he can get, you're blind.
Error 610: Partisan Source. Invalid.
Support Trumps budget. It is only the first step necessary to reign in this bloated federal Gov’t! Reduce or eliminate all departments except those that are supported by the Constitution. The Administration State that now runs most of the Gov’t with their endless making of REGULATIONS must be eliminated so the making of LAWS is returned to Congress! These Administration Staters are unelected and out of control.
The Heritage Foundation proves here it either uses falsified data, flat out lies, or has no concept how to read a budget, or, perhaps all three. You choose.
It’s a bunch of bull💩! Plain and simple!
Save American money and concentrate on America! It’s your job!
Ridiculous Repeal the tax cuts
I am not one of the 1% so no, I do not support Trump's budget.
Stop giving the wealthy welfare. Do not cut our social safety net programs. Social security is OUR MONEY, not an entitlement!
They represent more of the same unsustainable courses in public funding by failing to recognize the shortfall in revenues to fund the budget.
He’s good at wasting money! Border wall, space force!?? He’s like a child that never got to play with toys. He has accumulated the biggest national debt in history! Not one more word about and not one single dime out of my Social Security. Social Security is my pre-taxed deferred income, I’ve already paid taxes on it I haven’t received it yet. You need to pass some kind of bill to make sure he keeps his hands off of it.
It will ADD TO THE DEFICIT!!! RAISE TAXES ON THE RICH—that tends to help balance the budget, help pay for much needed programs and departments, and helps pay down the deficits. But republiKKKans only know how to screw 99% of the country and America’s land.
Providing a safety net for our people has many humanitarian as well as financial benefits for the country. Healthy, financially independent citizens with the ability to contribute their talents and skills has been the foundation of this country's leadership for the world. Instead of taking away the safety net we need to broaden and improve it.
He's an idiot.
I respect Nothing from him Congress has made a dictator. The GOP has crushed our Constitution and given a Crook free reign The GOP is being led around out of Fear and therefore are not leaders. The Senators are shameful Followers. Senators. I’m sickened
By cutting programs that have absolutely nothing to do with what caused the debt in the first place. Funny how it’s always the most vulnerable who can’t afford to cut huge campaign contribution checks, who are always called on to make the sacrifices.
It is absolutely ridiculous
This budget isn’t intelligent. It is clear the admin wants to cut as many social programs as possible to fund his vanity. None of the Indiana legislators have spine enough to stand up for their constituents. All three will go with the GOP flow. It is so sad to try to balance a budget by stepping on our poor, our children, our elderly. But that is as expected.
Republicans empty the treasury to give that money to their owners Then they complain there is not enough money to fund the rest of government Another con from the party of Trump the biggest con man in the country
We are a country that is suppose to help other and rise people up not down. Cutting funding to people in need is just mean. You end up Hurting the young and the old people of this country. Let’s have empathy for people. We all need help at one time or another. Also why do we need to keep adding money to our military and take away from the poorest in this country. We have people starving in the United States and our government does not do enough. Our president is more concern with deepening his own pockets then helping the country.
I don't support anything this president does or says. He's ruining our country and he never tells the truth.
His budget covers his ass on the huge tax breaks for the rich on the backs of seniors and poor. This is the usual game of spending for Gop. Take the billions back you gave to the rich. Trump wants to rob from us to build his fkg useless wall, bullshit!