Who Wins and Loses in Trump’s Proposed Budget


A Superfund cleanup site in Montana. Federal funding for such cleanups of hazardous wastes would be reduced by about a third. Credit James Snook/Associated Press

President Trump released a partial outline of his 2018 budget on Thursday, proposing billions of dollars in spending cuts to most government agencies to pay for large increases in military and homeland security spending, resulting in a 1.2 percent cut in discretionary spending over all. (Source: New York Times)

The tough choices he promised would eliminate longstanding staples of American life.

Gone would be federal financing for public television, the arts and humanities. Federal support for long-distance Amtrak train service would be eliminated. Washington would get out of the business of helping clean up the Chesapeake Bay or the Great Lakes.

While he may not care about East Coast elites upset about ending financing for the National Endowment for the Arts and the National Endowment for the Humanities, some of the agencies and programs that would be “zeroed out” are institutions in parts of the country that Mr. Trump won last November.

Among the agencies to be cut off, for instance, would be the Appalachian Regional Commission, a federal-state agency founded in 1965 to promote economic development and infrastructure in some of the poorest parts of the United States.

Mr. Trump and his aides argue that many of these programs have long since passed their usefulness or would be better off run and paid for at the state or local level. While he talked about the ravaged inner cities in his Inaugural Address, Mr. Trump would eliminate $3 billion in funding for the Community Development Block Grant program that helps provide affordable housing. The president argued in his budget that “the program is not well targeted to the poorest populations and has not demonstrated results.”

Instead of spreading the cost of affordable housing across all of the United States Trump passes the buck to state and local levels, making areas needing affordable housing the most raise taxes and fees to provide affordable housing.

Nice going Mr. Trump. The poor get poorer and the rich get richer. You’re certainly making America Great Again. For the wealthy.

Discretionary spending, in billions

Agency 2017 baseline 2018 proposal Change . Pct change
Environmental Protection Agency $8.2 $5.7 $2.6 –31%
State and other development programs 38.0 27.1 –10.9 –29%
Agriculture 22.6 17.9 –4.7 –21%
Labor 12.2 9.6 –2.5 –21%
Justice 20.3 16.2 –4.0 –20%
Health and Human Services 77.7 65.1 –12.6 –16%
Commerce 9.2 7.8 –1.5 –16%
Education 68.2 59.0 –9.2 –14%
Transportation 18.6 16.2 –2.4 –13%
Housing and Urban Development 36.0 31.7 –4.3 –12%
Interior 13.2 11.6 –1.5 –12%
Energy 29.7 28.0 –1.7 –6%
Treasury 11.7 11.2 –0.5 –4%
NASA 19.2 19.1 –0.2 –1%
Veterans Affairs 74.5 78.9 +4.4 +6%
Homeland Security 41.3 44.1 +2.8 +7%
Defense 521.7 574.0 +52.3 +10%
Note: Totals are shown for fiscal years, which begin in October. They reflect base budget levels for each department, which do not include supplemental money for disaster relief, emergencies or additional war spending. They do include offsetting receipts and proposed changes in mandatory programs (CHIMPS) that are used to offset discretionary spending.

The proposal would also eliminate funding for nearly 20 smaller independent agencies, including the National Endowment for the Arts, the National Endowment for the Humanities, the Corporation for Public Broadcasting and the Legal Services Corporation, which finances legal aid groups.

The blueprint does not include tax proposals or other revenue ideas, and outlines only proposals for discretionary spending, which is money appropriated annually by Congress. Discretionary spending makes up less than one-third of all federal spending. It does not include interest payments on the federal debt or so-called mandatory spending on large programs like Social Security, Medicare and Medicaid.

Read the more detailed and complete article on the New York Times.

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Trump budget plan could add $6tn to public debt in a decade, analysts say

Trump’s budget plans could add $6tn to a public debt that is already expanding rapidly, analysts say. Photograph: Bloomberg/Bloomberg via Getty Images

Trump’s budget plans could add $6tn to a public debt that is already expanding rapidly, analysts say. Photograph: Bloomberg/Bloomberg via Getty Images

Donald Trump’s tax-cutting and spending plans could add another $6tn to the US public debt over the next 10 years, independent budget analysts have calculated, as the Congressional Budget Office warned the US’s current spending plans alone could trigger a financial crisis.

The CBO released its latest assessment of the US budget and economic outlook on Tuesday. The CBO reported that Trump would inherit a $559bn deficit for 2017 and still-sluggish economy that will, on its current course, add another $10tn to the public debt over the next decade.

The CBO report projects that the US’s gross debt will grow from almost $20tn to $30tn by the end of 2027. Debt held by the public is expected to grow from about $14tn to almost $25tn. The major drivers for the debt are the growing cost of looking after the US’s ageing population and expected rises in interest rates.

“This is not a problem of runaway defense spending or runaway welfare programmes. It’s a problem of the rising cost of major entitlements that mainly go to the elderly and rising interest rates which are returning to more normal levels,” said Goldwein.

Unless something changes, within three decades the debt will double when measured against the size of the economy’s gross domestic product (GDP), the broadest measure of a nation’s economic health, reaching a level never seen in US history, the CBO said.

“Three decades from now, for instance, debt held by the public is projected to be nearly twice as high, relative to GDP, as it is this year – and a higher percentage than any previously recorded,” the CBO reported. “Such high and rising debt would have serious negative consequences for the budget and the nation.”

A debt of that size would lead to lower productivity and wages, and hamper lawmakers’ ability to use tax and spending policies to respond to unexpected challenges.

“The likelihood of a fiscal crisis in the United States would increase. There would be a greater risk that investors would become unwilling to finance the government’s borrowing unless they were compensated with very high interest rates; if that happened, interest rates on federal debt would rise suddenly and sharply,” the CBO warned.

Read the complete article on The Guardian newspaper web site here.