Domestic Spending Cuts, Border Wall Boost: Budget by the Numbers
President Donald Trump’s fiscal 2020 budget proposal calls for a 9 percent cut to nondefense discretionary spending, $8.6 billion for border fencing, and trillions of dollars of cuts in the next decade to mandatory spending, among other requests that will get a chilly reception among lawmakers.
The proposal, a political document that serves as an opening bid in spending negotiations, calls on Congress to stick to the budget caps under the Budget Control Act. But it calls for a total of $750 billion in defense spending, using Overseas Contingency Operations and emergency funds to exceed the $576 billion cap. The base nondefense discretionary request is about equal to the $542 billion spending cap, but it would total $567 billion when disaster relief and other cap-exempt funds are included. Compared with the $630 billion in nondefense discretionary budget authority in fiscal 2019, that’s an 8.5 percent cut.
The departments of Agriculture, Education, Health and Human Services, State and Transportation are in line for some of the steepest cuts under the proposal. Commerce, Homeland Security, Treasury and Veterans Affairs would receive increases.
Below are the proposed top-line spending levels for departments and a few major agencies, including Overseas Contingency Operations funding.
Debt and Deficit
The proposal projects a reduction in the deficit from $1.1 trillion in fiscal 2020 to $202 billion in fiscal 2029, relying on steep cuts to mandatory spending and nondefense discretionary funds, while anticipating strong sustained economic growth.
Economic Growth Assumptions: The proposal assumes 3.1 percent economic growth in fiscal 2020, 3 percent growth from fiscal 2021 to 2024, 2.9 percent in fiscal 2025 and 2.8 percent growth from fiscal 2026 to 2029. By comparison, the Congressional Budget Office’s latest projection anticipates 1.9 percent real, year-to-year gross domestic product growth in fiscal 2020.
Mandatory Cuts: The proposal calls for $51.8 billion in savings on mandatory programs in fiscal 2020 compared to fiscal 2019. That figure adds up to $2.1 trillion in savings from fiscal 2020 through 2029. It calls for $22.1 billion in changes to welfare programs in fiscal 2020, including $17.4 billion in savings from the Supplemental Nutrition Assistance Program, or food stamps.
The document also assumes $456 billion in savings by cutting Medicare waste, fraud and abuse over the course of the decade. It assumes changes to Medicaid, including partially converting it into a grant program, that would add up to $143 billion in savings over the decade.
The budget request assumes nearly $20 billion in savings from changes in mandatory programs, or CHIMPs, compared to $15.7 billion in fiscal 2019. That includes $15.3 billion from the Children’s Health Insurance Program. CHIMPs are often referred to as a budgeting gimmick, taking credit for savings from accounts in which the money likely wouldn’t have been spent anyway.
The budget request calls for the elimination of the following agencies or programs:
- Economic Development Administration
- Manufacturing Extension Partnership program
- Community Development Block Grant program
- HOME Investment Partnerships Program
- Community Development Financial Institutions Fund grant and loan programs
- Abandoned Mine Land economic development grants
- Interior Department Indian Guaranteed Loan Program
- National Wildlife Refuge Fund payments to local governments
- National Heritage Areas
- Advanced Research Projects Agency-Energy
- Title XVII Innovative Technology Loan Guarantee Program
- Advanced Technology Vehicle Manufacturing Loan Program
- Tribal Energy Loan Guarantee Program
Immigration & Border Spending
The request’s immigration and border proposals include:
- $8.6 billion for a border wall, including $5 billion for DHS and $3.6 billion for the Department of Defense;
- $506 million to hire an additional 2,800 officers and staff at U.S. Customs and Border Protection and Immigration and Customs Enforcement, and 128 immigration court prosecuting attorneys;
- $2.7 billion for 54,000 ICE detention beds; and
- Funds to hire an additional 100 immigration judge teams.
Other Proposal Highlights
The request also calls for:
- The creation of the Space Force as the sixth branch of the armed forces.
- A 3.1 percent pay increase for military service members.
- The creation of an Unaccompanied Alien Children Contingency Fund, with $480 million in funding in fiscal 2020 and $738 million over the decade.
- A Labor Department paid parental leave program that would cost $750 million in fiscal 2020 and $20.5 billion over the next decade.
- $291 million for Health and Human Services HIV programs.
- $7.2 billion for the Census Bureau as it prepares for its 2020 survey.
- $500 million in assistance to Europe, Eurasia and Central Asia to transition away from Russian military equipment and address macroeconomic dependence on Russia.
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