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Gov't Affairs News

NECA’s Take on POTUS FY '18 Budget

Jun 01, 2017

On May 23, President Donald Trump released his full budget “A New Foundation for American Greatness, Fiscal Year 2018”. The 2018 Budget aims to balance our Nation’s spending and begin to reduce the national debt as a percent of GDP over the next ten years. In addition to the budget, the White House released three supplemental documents detailing the Presidents Infrastructure InitiativeInvesting in Our National Defense, and promoting Air Traffic Control Reform, three of the Presidents top legislative priorities. Below are the highlights of the overall budget:

Breakdown of President’s FY 18 Budget

  • Defense Discretionary Spending: $603 billion.
  • Non-Defense Discretionary Spending: $ 462 billion. 

Key Takeaways of the Budget:

  • The President’s Budget balances in the 10-year budget window.
  • $3.6 trillion in spending cuts over 10 years.
  • Proposed economic growth rate of three percent – up from 1.9 percent from the Obama Budget.
  • Total of $57.3 billion savings to non-defense discretionary programs.
  • $26.7 billion in program eliminations.
  • The Presidents budget prioritizes national security through increases to defense spending and rebuilding the border wall.
  • Every federal department sees cuts except the Department of Defense (DOD), Department of Homeland Security (DHS), and Department of Veterans Affairs (VA)
  • There are no cuts to Social Security and Medicare benefits.
  • Reduction in public debt as a percentage of our economy from 77 percent this year to less than 60 percent in FY 2027.

Key Takeaways of the Infrastructure Initiative:

The Trump Infrastructure Initiative laid out a plan for $200 billion in direct federal spending over the course of ten years for major infrastructure projects. The plan also included incentives for states and local governments to work with private investors to fund projects. The $200 billion included in the budget is only a fraction of the $1 trillion plan the Administration has advocated for.

Breakdown of Major Discretionary Reductions:

Agriculture

21 % decrease

Defense

5 % decrease

Education

14 % decrease

Energy

6% decrease

Health and Human Services

16 % decrease

Homeland Security

7 % increase

Housing and Urban Development

13 % decrease

Dept. of Interior

11 % decrease

Dept. of Justice

4 % decrease

Dept. of Labor

20 % decrease

State and USAID

29% decrease

Transportation

13% decrease

Treasury

4% decrease

Department of Commerce

16% decrease

Environmental Protection Agency

31% decrease

General Services Administration

50% increase

Veterans Affairs

5.6% increase

Army Corps

16.3% decrease

President Trump’s budget is one the most ambitious and controversial budgets in recent administrations. The major hurdle the Trump budget will face is the House Appropriations Committee, where many members have expressed opposition to the President’s proposed cuts. One of the major points of contention between the House Budget Committee, House Appropriations Committee and the Administration is defense spending. Generally, the House Budget Committee has been in support of the $603 billion defense discretionary spending level. However, the majority of the Members were opposed to the $462 billion non-defense discretionary spending option and wanted to get closer to the House Appropriators mark of $516 billion. With the current political climate, it is unlikely that the Trump budget would pass Congress. A bipartisan budget has been negotiated by the Appropriations committee, and will be brought to a vote sometime in September.