Donald Trump’s first budget to boost defence spending, cut domestic agencies

People familiar with the budget who spoke on condition of anonymity in advance of the public release say the White House is seeking a 30% cut from an Energy Department office that promotes energy efficiency and renewable energy. The office has funded research on projects such as LED light bulbs, electric trucks, advanced batteries and biofuels.

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The Trump-endorsed House bill cuts taxes by $1 trillion over the coming decade while devoting hundreds of billions of dollars in Medicaid cuts toward a new GOP subsidy. Trump’s budget options are already being hemmed in by decisions on health care.
1. Democrats are unlikely to support the cuts, and Republican defections raise the possibility of a congressional train wreck and a potential government shutdown when the 2018 budget year begins Oct.

The Office of Energy Efficiency and Renewable Energy is targeted for at least $700 million in cuts from its current $2.1 billion budget, said Scott Sklar, chairman of the steering committee of the Sustainable Energy Coalition.
“Unfortunately, we have no alternative but to reinvest in our military and make ourselves a military power once again,” White House economic adviser Gary Cohn said on Fox News Sunday.

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The spending plan, set for release Thursday, would make the Pentagon the big winner with a US$54 billion boost to defence spending. The Republican president will ask his adopted political party, which runs Capitol Hill, to cut domestic agencies such as the Environmental Protection Agency and the departments of Education and Housing and Urban Development, along with grants to state and local governments and community development projects.

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Trump’s submission won’t tell the complete story. It will be limited to the discretionary, $1 trillion-plus portion of the $4 trillion annual federal budget that pays for Cabinet agencies and departments.

“These are tough decisions, but the president has shown he is ready, willing and able to make these tough decisions,” he said Sunday. Cohn defended the spending cuts elsewhere as necessary to balance the budget.

He’s also promising $1 trillion in infrastructure spending, even as pressure is building to finance tax cuts with borrowed money. But Trump is promising to leave the government’s two largest programs, Medicare and Social Security, virtually untouched.

The remainder of Trump’s budget — proposals on taxes, mandatory spending and deficits and projections on the economy — won’t come out until May. That document is sure to upset members of the GOP’s once-proud and large band of deficit hawks, because Trump’s full plans are sure to show large, permanent budget deficits, even with all of the tricks and tools available to the White House Budget office.
Unless Congress passes and Trump signs a catchall spending bill or another extension, the government would partially shut down. Democratic votes are needed to pass the bill through the Senate, but any measure that satisfies Democrats is sure to alienate tea party Republicans. April 28: A temporary, government-wide funding bill expires.

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The government ran a $587 billion deficit last year that required it to borrow 15 cents of every dollar it spent. Looking ahead, the nonpartisan Congressional Budget Office says the government is on track for accumulated deficits of more than $9 trillion over the coming decade.

BUDGET TIMELINE MIXES DEADLINES, UNCERTAINTY

CBO Director Keith Hall warns that such huge deficits are putting the government on a long-term path that “would have serious negative consequences for the budget and the nation, including an increased risk of fiscal crisis.”

That’s the $1 trillion-plus portion of the $4 trillion federal budget that passes through Congress each year. Thursday: Trump submits a budget covering only discretionary spending. Trump’s plan will boost the Pentagon’s budget by $54 billion — about 10% — while cutting domestic programs and foreign aid by an equal amount.

Some key dates in the process:

obligations such as Social Security benefits and interest payments. Such “extraordinary measures” will buy time until the fall for lawmakers to approve legislation increasing the debt limit. Early March: With Wednesday’s deadline to increase the government’s borrowing authority looming, Treasury Secretary Steven Mnuchin said he would use bookkeeping measures to avert a first-ever government default on U.S.

Summer-Fall: The Republican-run Congress tries to advance spending bills for the 2018 budget year, which begins Oct. Meeting that deadline is highly unlikely, but at some point, budget talks probably will begin — assuming, as many do, that the regular process will have broken down. 1.

“They’re going to have a hell of a hard time passing a budget that balances — even fabricating a budget that balances,” said Kentucky Rep. “This health care bill is going to make their budget very tricky.” John Yarmuth, the top Democrat on the House Budget committee.

President Donald Trump sends Congress a proposed budget this week that will sharply test Republicans’ ability to keep long-standing promises to bolster the military, making politically painful cuts to a lengthy list of popular domestic programs. WASHINGTON — U.S.
Cuts to the Coast Guard are meeting Republican resistance. Trump’s plan to eliminate community development block grants was dismissed on Capitol Hill by those who remember how a modest cut to the program sank a spending bill not long ago. Sen. Rob Portman, R-Ohio, is joining with Democrats to push back on that last proposed reduction.
Associated Press writer Matthew Daly contributed to this report.
Trump said repeatedly during the campaign that Mexico would pay for that project, but Mexico has said no. Preliminary reports on the budget show some domestic Cabinet agencies, such as the departments of Homeland Security and Veterans Affairs, would see increases, including $3 billion for Trump’s promised wall on the U.S.-Mexico border.

Trump has promised to “do a lot more with less,” but his blueprint faces a reality test with Republicans, many of whom are already protesting.

Those intended spending increases, however, would mean deeper cuts elsewhere.

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The United States, however, already spends more than half trillion dollars on defence, more than the next seven countries combined.
Trump’s signature is needed on what promises to be an omnibus spending bill with a $1 trillion-plus price tag. None of the 12 annual appropriations bills has been enacted and a temporary funding measure expires next month. The path toward passage may be rocky, given the political land mines such as the border wall and a budget-busting supplemental Pentagon request.
Trump’s preliminary budget, delivered in secret to agencies last month, proposes a 37% cut to the State Department and foreign aid budgets. Those cuts and others were subject to revision in the back and forth that the White House had with agencies leading up to the coming release this week.

The Energy Department could see steep cuts for its 17 national laboratories, which conduct cutting-edge research on topics from nuclear power to advanced materials for energy generation, storage and use.

These annually appropriated programs have been squeezed in recent years while the costs of mandatory programs such as Medicare and Social Security have risen each year, mostly unchecked.
There’s also a more immediate quandary: What to do about the current budget year?
Trump’s release of a spending blueprint for the upcoming budget year will set in motion a debate that’s full of uncertainty — and the potential for gridlock, even a government shutdown.
Around the same time, Congress is likely to work on its annual budget resolution, which promises to be very difficult but is a precursor to Trump’s promise to overhaul tax laws. May: Trump reveals the remainder of his budget, including tax proposals, plans for curbing mandatory spending, economic projections — and large deficits.

Republicans have groused about some of the preliminary plans, including elimination of the $3 billion community development block grant program that’s popular among local GOP officials, a 25% cut to the EPA and elimination of 3,000 jobs, and essentially scuttling a $300 million per-year program to clean up the Great Lakes.
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(Chip Somodevilla/Getty Images) U.S. President Donald Trump.