“We’re no longer going to measure compassion by the number of programs or the number of people on those programs,” White House budget director Mick Mulvaney said. “We’re going to measure compassion and success by the number of people we help get off those programs and back in charge of their own lives.”
According to early reports of President Donald Trump’s fiscal 2018 budget, the White House would slash $3.6 trillion from the budget over 10 years in the hopes of balancing the books by 2028.
Reportedly, the Trump budget, which will likely die in Congress, would reduce Medicaid payments, cut food stamps and agricultural subsidies and boost monthly student loan payments.
Here is what Bloomberg News reports:
But while defense spending is set to see a boost, social safety net programs are in the president’s crosshairs. Medicaid cuts of $610 billion would come alongside $250 billion savings — partly fueled by limiting expanded Medicaid — from repealing Obamacare. Food stamps would be cut by $193 billion.
Federal workers would see much less generous retirement benefits under the budget. Eliminating cost-of-living adjustments for retirees would save $42 billion while increasing required employee retirement contributions would save $72 billion. And the budget would save $72 billion through cuts to Social Security Disability Insurance.
The administration has pitched its changes to student loan programs as beneficial to students. The budget would create a single repayment plan that would cap monthly payments at 12.5 percent of discretionary income, an increase from the 10 percent cap under some existing payment plans. But students would only need to repay their loans for 15 years, rather than 20, with the remainder wiped out by the federal government. That change would cut the federal subsidy by $76 billion.
If the reports are true then this is something the United States seriously needs. However, Senate Republican Leader Mitch McConnell said Congress would ignore the proposal, adding that the budget isn’t the Republicans’.
Even if the GOP supported the proposal, former Treasury Secretary Larry Summers called it the biggest accounting mistake in 40 years in a Washington Post op-ed:
Details of President Trump’s first budget have now been released. Much can and will be said about the dire social consequences of what is in it and the ludicrously optimistic economic assumptions it embodies. My observation is that there appears to be a logical error of the kind that would justify failing a student in an introductory economics course.Apparently, the budget forecasts that U.S. economic growth will rise to 3.0 percent because of the administration’s policies — largely its tax cuts and perhaps also its regulatory policies. Fair enough if you believe in tooth fairies and ludicrous supply-side economics.Then the administration asserts that it will propose revenue neutral tax cuts with the revenue neutrality coming in part because the tax cuts stimulate growth! This is an elementary double count. You can’t use the growth benefits of tax cuts once to justify an optimistic baseline and then again to claim that the tax cuts do not cost revenue. At least you cannot do so in a world of logic.The Trump team prides itself on its business background. This error is akin to buying a company assuming that you can make investments that will raise profits, but then, in calculating the increased profits, counting the higher revenue while failing to account for the fact that the investments would actually cost some money to make. The revenue generated by the investments might exceed their cost (though the same is almost never true of tax cuts), but that doesn’t change the fact that the investment has a cost that must be included in the accounting.This is a mistake no serious business person would make. It appears to be the most egregious accounting error in a presidential budget in the nearly 40 years I have been tracking them.
So far, think tanks and independent institutions say that the president would increase the budget deficit and boost the national debt.
3.6 Trillion? It should be 6.3 Trillion, no increase to the military budget, until DoD stops wasting money. IE-New office furniture because if we do not spend the money, we will not get the money in next years budget = multiply that by x military bases by x offices by x items and you come up with billions of dollars buying stuff the military already has and does not need. I know I spent 20 years in the USAF and it happens every year. We need to stop growing the Federal Government by 8% per year, when the GDP is growing at less than 3%.