The first (and, in some respects, the only) thing you need to know about Donald Trump’s $4.8 trillion budget plan for the upcoming fiscal year, is that it amounts to little more than political posturing.
You could say it’s more “proposal” than “plan” – or even that it’s more “wishful thinking” than “proposal”. You might even describe it as a “Dear Santa,” letter.
But even those characterizations don’t quite capture it. The annual budget put forth by the White House isn’t binding. It is, as Reuters succinctly puts it, “largely a political document that serves as a starting point for negotiations with Congress”. Final work on spending in 2021 won’t be completed until after the election.
And yet, in the Trump era, this perfunctory opening salvo in the painful budget wrangling process is always good for a few laughs.
Last year, for example, Nita Lowey, the top Democrat on the House Appropriations Committee, sarcastically congratulated the president for “somehow manag[ing] to produce a budget request even more untethered from reality than his past two”.
This year’s plan reflects some of Trump’s most cherished talking points (calling them “ideals” would be too strong considering most insiders contend the president has no set beliefs) including cuts to the Environmental Protection Agency and foreign aid programs.
The president said the budget doesn’t affect Medicare or Social Security and wouldn’t reduce Medicaid funding. Chuck Schumer disagrees. “President Trump’s latest budget is simply a continuation of his war to rip away health care from millions of Americans, including people with pre-existing conditions”, Schumer said, in a statement.
Spoiler alert: Trump isn’t telling the truth. Or at least not entirely. “Trump’s budget would reduce Medicare spending by lowering drug costs and tighten eligibility requirements for Social Security’s disability program”, Reuters notes, adding that the budget would also “enact new work requirements for people who get food stamps or use the Medicaid health plan for the poor”.
“While the president has vowed he would not cut Social Security or Medicare, his budget envisions savings from the health care program by ‘eliminating wasteful federal spending’ and other changes Democrats argue could ultimately decrease coverage or benefits”, Bloomberg writes.
“These deep cuts send a clear message to the American people about the Trump administration’s warped values and misplaced priorities”, Lowey said Monday. “I look forward to working with my colleagues to reject this proposal and instead invest in America’s working families”.
The New York Times delivers a somewhat fatalistic assessment:
The president’s plan includes what officials described as $4.4 trillion in spending cuts over the next decade, with about $2 trillion coming from changes to safety net programs and student loan initiatives.
Those reductions encompass new work requirements for Medicaid, federal housing assistance and food stamp recipients, which are estimated to cut nearly $300 billion in spending from the programs. The budget will also cut spending on federal disability insurance benefits by $70 billion and on student loan forgiveness by $170 billion.
The budget will propose cutting foreign aid spending by 21 percent and, as in previous budgets, eliminate funding for the Corporation for Public Broadcasting.
Despite cuts to social programs, the White House still sees gross federal debt exceeding $30 trillion over the next decade.
As you can imagine, Trump wants more money for the military and, of course, more funding for the border wall.
The budget also includes some $1.4 trillion earmarked to extend the individual tax cuts out to 2035, and an additional $1 trillion for infrastructure spending. Oh, and Trump wants $15.6 billion for the Customs and Border Protection agency (that’s on top of the $2 billion he wants for the wall itself) plus $9.9 billion for ICE, a number that would represent a 23% increase.
The budget contains the usual unrealistic growth projections. Last year, I lampooned the budget for those same rosy projections. Now, they’re back. The budget assumes the US economy will expand 3.1% in the fourth quarter of 2020 compared with a year earlier, and then proceed along at a similar clip thereafter. That’s not even close to realistic. In fact, on my data, Trump’s projections aren’t even captured in the tail of the distribution (note that the below was current through late last year, so some of these estimates have probably been revised higher, but you can be absolutely sure that nobody is on the same page with Trump).
The Congressional Budget Office last week said growth will likely be 2.2% in the current fiscal year, 1.9% in 2021, 1.7% in 2022 and 1.6% in 2023. Trump’s figures aren’t just unrealistic, they are laughable.
As Bloomberg goes on to detail, “the spending plan predicts Trump will succeed in passing his still-to-be-unveiled overhaul of the nation’s health-care system, banking $567 billion in savings over the next decade”. Got that? Trump is assuming more than a half-trillion in savings based on a healthcare plan which nobody has seen yet and which, let’s face it, almost surely does not exist.
In any event, readers can peruse the entire political document (it’s basically just a 138-page campaign manifesto) below, although, as Sheldon Whitehouse will be happy to explain, it’s a waste of your time.
“Everyone knows the latest Trump budget is dead on arrival in Congress”, Whitehouse said, in a statement. “It’s merely a political stunt to gratify extremists in his party”.
If you’re still not convinced that this is largely meaningless, you should just ask Trump himself, who, while regaling wealthy donors at Mar-a-Lago with his version of the Qassem Soleimani assassination last month, said this: “Who the hell cares about the budget?”