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President’s Proposed Budget Cuts Potentially Deeper than Meet the Eye

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President’s Proposed Budget Cuts Potentially Deeper than Meet the Eye

October 29, 2018

ANCOR is sharing this RollCall article on the implications of the President’s proposed cuts to the federal budget because fiscal austerity measures often carry implications for safety net supports. However, we remind members that Presidential budget proposals do not have the force of law because the ultimate decision on federal funding lies with Congress. We encourage members to keep informed on both Congressional and Administration proposals to get a full sense of the policy climate. We note that pressures on the federal budget due to the 2017 tax cuts are generating interest from GOP Senate Leadership in revisiting cuts and reforms to the safety net, including Medicaid. It is important to note that Congressional interest in safety net cuts will be contingent on the political landscape following the election.

As shared by Roll Call:

“President Donald Trump’s new push to trim the proposed budgets of all federal agencies next year could prove more draconian than it sounds, amounting to a 25 percent cut for all nondefense programs compared to the current year.

Technically, the request is for 5 percent cuts across the Cabinet departments, as Trump laid out at a White House event Wednesday: ‘We’re going to ask every [Cabinet] secretary to cut 5 percent for next year,’ Trump told reporters, presumably referring to fiscal 2020, beginning next October.

An across-the-board cut of 5 percent from all discretionary spending likely to be enacted in fiscal 2019 would amount to about $62 billion, not counting money for war-related operations and natural disasters. However politically unpalatable that may be, such cuts could actually understate the depths of reductions the administration may be envisioning.

That’s because if recent history is any guide, the reductions may not come from current spending, but from already depressed fiscal 2020 levels previously laid out in the February budget request. The Obama administration Office of Management and Budget asked agencies to cut their proposed budgets by 5 percent in that fashion on at least four occasions.

If that’s the case with the Trump OMB this time, it would mean fiscal 2020 nondefense discretionary budget authority in his request due next February would be roughly $445 billion — a whopping $152 billion, or 25 percent, cut from the fiscal 2019 cap signed into law by Trump in February. That would also be nearly $100 billion below the austere fiscal 2020 nondefense funding required under the 2011 deficit reduction law — already reviled by lawmakers from both parties — which snaps back into place upon expiration of the February deal after fiscal 2019.

[…]

And while most of the current year’s spending bills have yet to be completed, it’s already clear Trump won’t get many of the cuts he sought. Lawmakers of both parties have roundly rejected deep cuts to the State Department, EPA and more. In fact, a Republican-led House and Senate are heading toward a 3.1 percent increase in nondefense discretionary spending for this year, compared to fiscal 2018 levels. That’s a 10.4 percent increase over Trump’s request.”