Donald Trump budget 2019: what he cuts, how much he cuts, and why it matters

The budget proposes massive, historic cuts to everything from the EPA to Medicare.

By Dylan Matthews@dylanmattdylan@vox.com  Feb 12, 2018, 4:10pm EST

On Monday, President Donald Trump unveiled the second budget proposal of his presidency, encompassing proposals affecting defense and non-defense funding for government agencies, tax changes, and funding for social insurance and assistance programs like Social Security, Medicare, Medicaid, and food stamps.

The budget broadly resembles the budget he released last year, and both closely follow budget plans put forward by House Speaker Paul Ryan when he was the House Budget Committee chair. Ryan’s previous budget proposals featured trillions in cuts to programs for the poor. While Trump largely leaves the non-disability portions of Social Security unscathed, and boosts funding for border security, veterans, and defense, he cuts just about everything else — including Medicare, which was largely spared in the fiscal year 2018 budget.

The new budget also calls for passing an Obamacare replacement bill that deeply cuts Medicaid to far below its pre-Obamacare levels, making the tax bill passed in 2017 permanent, and slashing food stamps dramatically.

As with last year’s, this budget assumes an extremely unrealistic economic growth rate — 3 percent, above the currently projected 1.9 percent. This assumption results in $3.1 trillion lower deficits than would otherwise result — which, since the budget claims $3.1 trillion in net deficit reduction through spending cuts, suggests the budget might not close the deficit at all if you use more realistic assumptions.

It’s an ambitious document that stands in marked contrast to the actual actions of the administration and its allies in Congress, who just last week agreed to a massive increase in non-defense discretionary spending, which this budget now proposes to cut by more than 40 percent.

1) What are the big takeaways from the budget?

According to the centrist, pro-balanced budget group the Committee for a Responsible Federal Budget (which, regardless of its political leanings, is a reliable source of rigorous budget analysis), the president’s budget has a total of $3.1 trillion in budget savings relative to current law. It includes $1.75 trillion in new spending and tax cuts, $3.7 trillion in deficit reduction that’s overwhelmingly the result of spending cuts, $800 billion in reduced spending on wars and disaster recovery, and $300 billion in savings due to lower interest payments on less debt.

The big proposed policy changes include:

• A 42.3 percent cut to all “non-defense discretionary” spending, from the currently planned level of $756 billion in 2028 to $436 billion. This category includes funding for government agencies like the Environmental Protection Agency and the State Department, certain safety net programs like Head Start, law enforcement spending at the FBI and Department of Justice, and scientific research through the National Institutes of Health and National Science Foundation.
• A 33.7 percent cut to the EPA, a 29.5 percent cut to the National Science Foundation, a 22.2 percent cut to the Army Corps of Engineers (a major infrastructure program), a 21.4 percent cut to the Labor Department, and a 26.9 percent cut to the State Department, among many other discretionary spending cuts.
• A $777 billion boost to defense spending over 10 years, paid for partially by reducing “overseas contingency operations” spending (also known as the war budget). By 2028, total defense spending will be lower, but over the next few years it will be significantly higher (7.9 percent higher in 2020, for instance).
• A 7.1 percent cut to Medicare by 2028, due to reforms meant to cut payments to providers and reduce wasteful treatment without limiting access to health care. The Affordable Care Act in 2010 included many similar provisions with related goals.
• A 22.5 percent cut to Medicaid and Obamacare subsidies by 2028, through repealing and replacing Obamacare.
• A 27.4 percent cut to SNAP (food stamps) and a 20.1 percent cut to Section 8 housing assistance by 2028:
• $550 billion in new tax cuts achieved by making the individual and estate tax provisions in last year’s tax bill permanent.
• $199 billion over 10 years for a new infrastructure program meant to generate $1 trillion through private partnership spending; this is offset by a 28.6 percent cut to transportation spending from 2017 to 2023, cuts which over the same 10-year period total $178 billion. Combined with cuts to water and other infrastructure programs, it’s not clear the budget actually spends more on infrastructure than happens currently.

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https://www.vox.com/policy-and-politics/2018/2/12/16996832/trump-budget-2019-release-explained