Trump’s Proposed Budget Would Protect Social Security and Medicare, Raise Spending on Defense and Borders

The Associated Press
The Associated Press

President Donald Trump released a $4.8 trillion budget proposal on Monday that would protect Social Security and Medicare, raise spending for defense and border protection, and cut welfare and foreign aid spending.

The plan leaves Social Security and Medicare benefits untouched, keeping a campaign promise of the president’s not to cut the popular entitlements. That will make it harder for the president’s rivals to run the standard Democratic playbook–scaring Americans about the loss of promised benefits–against him in this year’s presidential election.

The budget includes additional spending for the military, veterans, border enforcement, and space exploration. It also proposes to extend the individual tax cuts that were set to expire in 2025, preserving the benefits of the 2017 tax reforms for millions of Americans.

The biggest spending cuts arise from an annual two percent reduction in non-defense discretionary spending, including federal education programs and environmental regulation. That would put the Trump administration at odds with the remaining Democrat presidential hopefuls, all of whom have proposed to vastly expand federal spending, setting up a fight over spending as America heads into the 2020 election.

The White House budget is a messaging document, largely intended to reflect the administration’s budget priorities rather than a set of policies expected to be enacted by Congress. That is particularly true now that the Democrat party controls the House of Representatives. Most observers expect any serious negotiations over the budget will be delayed until after the 2020 elections in November, with the government being funded through temporary extensions once the current fiscal year ends in October.

This year’s budget can be seen as an outline for what President Trump hopes to accomplish should he win reelection in November.

The budget includes a 13 percent hike in the budget for the Department of Veterans Affairs, and a three percent rise in the budget for the Department of Homeland Security. NASA’s budget would rise by 12 percent.

The budget includes $4.4 trillion in spending cuts–or reductions from spending that would occur under current law–over a decade. The bulk of the cuts come from reductions in spending for discretionary spending that would occur if current legislation were left unchanged.

The budget also includes a $130 billion reduction in Medicare spending over a decade. But this is not accomplished by reducing benefits. Instead, the budget foresees this as a consequence of containing increases in prescription drug prices and improved efficiency.

Another $292 billion of savings comes from tightening access to Medicaid and food stamps, such as work requirements. Tightening access to Social Security disability programs is seen as saving $70 billion.

Unlike previous White House budgets from the Trump administration, this year’s does not include a total repeal of Obamacare.

Foreign aid payments would be reduced by 21 percent. The Department of Housing and Urban Development’s budget would be reduced by 15 percent. The Environmental Protection Agency’s budget would be cut by 26 percent.

The budget forecasts that federal deficits over the next decade would be $4.6 trillion lower under its plan. Annual deficits would be eliminated by 2035, a decade after President Trump would leave office if re-elected.

The budget continues to push the Trump administration’s view that the economy can grow much faster if its spending and tax policies are enacted. It foresees the economy growing at a rate of around three percent, a percentage point higher than the projections of the Federal Reserve and the Congressional Budget Office.


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