Trump's 'Skinny Budget': The Good, the Bad, the Missing
President Trump’s “skinny” budget was released last week and you’d think the world has already ended because it includes cuts to a number of agencies. Typically, a president proposes a comprehensive, detailed budget thousands of pages long. But that’s a monumental task just weeks after assuming office, so new presidents present a smaller budget followed by the more detailed one later.
Trump’s “skinny” budget, though, is briefer than usual because it only deals with the small part of spending the Washington crowd refers to as “discretionary” spending. Before thinking that the world is ending, let’s take a step back and look at it as part of the whole budget picture.
The budget adheres to established spending caps for 2018. This is important. Federal spending is on an unsustainable path so keeping some discipline in Washington’s spending is essential.
All new spending is paid for by spending cuts. Let’s face it, government cannot do everything nor should it try. So, Trump’s budget eliminates programs which are duplicative, wasteful, or not a core function of government like, for instance, the Overseas Private Investment Corporation. The federal government shouldn’t support private corporations, at home or overseas.
It cuts other programs. Not Washington cuts, which usually cut the growth in spending, but real cuts. Even though discretionary spending is just 1/3 of the budget, it has helped drive up spending levels with some programs like international affairs, community and regional development, and energy getting massive increases. The 2011 Budget Control Act helped put the brakes on this, but more cuts should be on the table.
While new spending for 2018 is fully offset by cuts elsewhere, new 2017 spending for defense is only partially offset which adds $15 billion to the deficit. Nor are there specifics on the 2017 cuts.
The budget meets total discretionary spending caps, but blows through defense caps by adding $54 billion to DoD. Better would be a net reduction under the cap by weeding out unnecessary defense spending, like green fleet requirements, or running hotels and golf resorts.
Budget details are scant, leaving Congress and the public with a limited understanding of how the proposals and priorities fit together.
This includes essentially everything else. Budgets, especially the President’s, should set a big picture vision for the direction of the country – with details.
Even as a first budget, it doesn’t compare well to his predecessors' with only 5 cursory budget tables. By comparison, Obama’s budget outlined his entire policy vision and included 9 tables of details; Bush’s included 16 tables and even more detail – both addressed the entire budget. Bush and Obama presented a full “fat” budget later in the spring.
Notably missing is any discussion of entitlements: Social Security, Medicare, Medicaid and Obamacare. Entitlements and interest on the debt comprise 60 percent of the budget. If Trump doesn’t touch entitlements, that number will grow to 77 percent in just ten years and take up 99 percent of all federal tax revenues and keep on growing.
Last but not least, there is no discussion of the national debt, save one mention of the “$20 trillion debt crisis.” Debt is actually on pace to reach $30 trillion in 10 years, growing from $90,000 per household to $170,000. The President must lead on this issue too by laying out his vision to tackle it in the budget.
What’s Next and Why It’s Important
The skinny budget is a good start, as far as it goes. But since it skips the big picture, it’s a missed opportunity to show Americans how Trump’s signature policies like tax reform, repeal of Obamacare, his infrastructure package and so forth will all fit together. The Trump administration’s next budget step should be a comprehensive “fat” budget, chock full of details. Without this, it’s impossible to know what the President’s priorities are, and how they square with budget reality.