Trump’s Budget Boosts Defense and Infrastructure, Cuts Trillions in Spending

The White House released President Donald Trump’s "taxpayer-first" budget proposal for fiscal year 2018 on Tuesday, which calls for $3.6 trillion in spending cuts over the next decade while assuming the enactment of across-the-board tax cuts plus the repeal and replacement of Obamacare. It claims that mixture of policies will fuel economic growth and bring the budget into balance within 10 years.

Like most presidential budget proposals, it will never be brought up for a vote and serves primarily as a wishlist of sorts that’s used as a frame of reference in negotiations with Congress during the budgeting and appropriations process. In that respect, Trump's proposal is a dramatic reconfiguration of the role of the federal government in fostering economic growth and providing safety net programs relative to the Obama administration.

There’s a lot in the 62 page budget (entitled "A New Foundation For American Greatness"), some of which has changed from the administration’s release of the “skinny budget” earlier this year, so we’ve broken down the big items for you below:

Nondefense discretionary programs: All Cabinet-level federal agencies that aren’t related to national security or caring for veterans would have their funding reduced starting in 2018. The biggest cuts would come at the Depts. Of State ($11.5 billion), Education ($9.2 billion), Agriculture ($4.6 billion), and the Environmental Protection Agency ($2.6 billion).

Medicaid and Welfare: A series of reforms to Medicaid, which provides healthcare to low-income individuals, are expected to result in a reduction in spending of $610 billion over a 10 year period. States would be given a choice between getting federal Medicaid funding on a capped, per capita basis or a block grant that gives states greater flexibility in implementing their Medicaid programs.

The Supplemental Nutrition Assistance Program (SNAP) — also known as food stamps — would be reformed through tighter eligibility standards, establishing a state match for federal dollars, and work requirements. Taken together, these factors are expected to reduce federal spending on SNAP by $190 billion over 10 years.

Defense and Veterans: Spending on defense would increase by $52 billion to $639 billion for 2018, which looks to improve the Armed Forces’ readiness, support increased personnel levels, and acquire or upgrade equipment. The Dept. of Veterans Affairs (VA) would see its budget increase by $4.3 billion for 2018, and the Veterans Choice program that lets veterans get subsidized care at private healthcare providers would be extended.

Infrastructure: As part of a planned $1 trillion private / public infrastructure investment program, $200 billion would be spent over the next 10 years under the proposed budget. The remaining $800 billion would come from a variety of private sector, state, local, and other stakeholders that would invest in the projects.

Border Security and Public Safety: The budgets at the Depts. of Homeland Security and Justice would provide for the hiring of additional law enforcement agents to enforce immigration laws, in addition to investing in cybersecurity. A total of $2.6 billion in 2018 would go to improving security infrastructure at the border, including the replacement or new construction of a border wall.

Savings from Economic Growth: The administration estimates that policies included within the budget, the repeal and replacement of Obamacare, across-the-board tax cuts, and deregulation would lead to stronger economic growth that results in more than $2 trillion in additional tax revenue over 10 years. This assumes that the U.S. economy’s gross domestic product (GDP) will grow by 2.3 percent this year, 2.4 percent in 2018 and gradually rising to 3 percent in 2021 and thereafter. In 2016, U.S. GDP was 1.6 percent.

Miscellaneous:

• New parents would receive six weeks of paid parental leave under a $19 billion program included in the proposal.

• Planned funding cuts to the Office of National Drug Control Policy that had been included in the "skinny budget" were much lighter than planned, with the proposed reduction totalling 3 percent rather than 95 percent.

• Income-driven repayment plans for student loans would be consolidated from several options to one, and the cap on borrowers’ monthly payments would be raised to 12.5 percent from 10 percent. Public service loan forgiveness programs would also be eliminated. In part because of these changes, funding for Pell Grants would increase by $1.5 billion in 2018.

• Standards for the disability programs would be made more strict, leading to reduced enrollment and $72 billion less in spending over 10 years.

• The EPA’s geographic programs for cleaning up the Great Lakes, Chesapeake Bay, Puget Sound, and others would be eliminated.

• The Corporation for Public Broadcasting, which runs the Public Broadcasting Service (PBS) and National Public Radio (NPR) would be eliminated.

• The National Endowments for the Arts and Humanities, and the U.S. Institute of Peace would be eliminated.

• Payments to the United Nations climate change programs would be eliminated, while U.S. contributions to peacekeeping missions would be reduced by about half, or $1.2 billion.

Tell your reps what you think of major provisions in the Trump administration’s 2018 budget proposal using the Take Action button.

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If you want a copy of the budget for yourself, page four of the PDF includes a number you can call to order a CD-ROM of the budget. Thanks to Countable's reporting we can tell you it costs $29 (plus shipping, probably).

— Eric Revell

(Photo Credit: Gage Skidmore.jpg via Flickr / Creative Commons)