A quick guide to the latest White House budget plan, which slashes safety net programs and ramps up military spending

ReutersU.S. President Donald Trump holds a campaign rally at Drake University in Des Moines
  • The Trump administration unveiled a $US4.8 trillion budget proposal Monday afternoon that would slash domestic programs and ramp up military funds.
  • The proposal for fiscal 2021, which begins in October, has no chance of passage and instead sets the stage for future budget negotiations with Congress.
  • Here are the major changes included in the 138-page blueprint.
  • Visit Business Insider’s homepage for more stories.

The Trump administration unveiled a $US4.8 trillion budget proposal Monday afternoon that would slash domestic programs and ramp up military funds, sending a strikingly different message than Democratic rivals ahead of the November election.

The proposal for fiscal 2021, which begins in October, has no chance of passage and instead sets the stage for future budget negotiations with Congress. Here are the major changes included in the 138-page blueprint.


Military

Kevin Lamarque/ReutersPresident Donald Trump talks with a US Customs and Border Protection (CBP) Border Patrol Agent while participating in a tour of US-Mexico border wall prototypes.

The budget requests $US705.4 billion for the Department of Defence, a 0.3% increase from current levels. But it reduces foreign aid by 21%.

Trump proposes $US2 billion for the construction of a wall along the southern border, less than half of the amount requested last year. Those funds have been at the centre of a heated spending dispute between the White House and Democrats, leading to a five-week government shutdown in 2018.


Safety net programs

Reuters/Fred ProuserAn American flag flutters in the wind next to signage for a United States Social Security Administration office in Burbank, California.

Funding for social safety net programs would fall by about $US292 billion under the White House budget proposal.

It suggests cutting food stamp benefits by about $US180 billion over a decade. The Trump administration has already taken steps to increase federal enforcement of the Supplemental Nutrition Assistance Program, which was in December expected to cut 688,000 people off from benefits.

Despite promises to protect Medicare, the proposal lays out cuts to hospitals and doctors that would drastically reduce spending for the program over a decade. It rolls out new work requirements for Medicaid recipients and envisions savings through tighter rules for disability benefits.


Domestic agencies

AFP Contributor/Getty Images

The proposal increases funding for the Department of Veterans Affairs by about 13%. But it cuts nondefense spending below the levels laid out in a two-year spending deal Trump and Congress reached last year.

The Commerce Department would see its budget slashed by more than 37%, a decline the White House attributes to the end of the 2020 census count. The proposal would chop Agriculture Department funding by about 8% overall.

The Environmental Protection Agency would also take a drastic hit, with its budget slashed by 26.5%. The Department of Health and Human Services, which includes the Centres for Disease Control and Prevention, would be cut by more than 9%.


NASA

ReutersHandout photo of members of NASA’s Mars 2020 project assembling the Mars 2020 rover in Pasadena

Trump, who wants to send US astronauts back to the moon and to prepare for them for travel to Mars, recommends increasing the National Aeronautics and Space Administration budget by about 12%.


Deficit

AP Photo/Jacquelyn MartinA ‘clock’ representing increasing federal debt is projected on Capitol Hill in Washington, Wednesday, July 12, 2017, as Republican members of the House Financial Services Committee question Federal Reserve Chair Janet Yellen.

The nation would continue to run annual deficits under the budget despite spending cuts, undermining a key campaign promise for Trump and a longtime Republican talking point.

In 2016, Trump promised to eliminate the deficit within eight years. The White House forecasts that won’t happen until 2035, a figure budget experts are sceptical of. The budget assumes economic growth around 3%, a target the US has fallen short of each year under Trump.

The budget calls for tax cuts that would have otherwise expired in 2025 to be made permanent, a move that would drive the deficit wider. The Trump administration has separately said it would propose another round of tax cuts this year, this time aimed at the middle class.


Prescription drugs

REUTERS/Brian SnyderPharmacist Jim Pearce fills a Suboxone prescription at Boston Healthcare for the Homeless Program in Boston, Massachusetts January 14, 2013.

The budget assumes $US135 billion in savings from drug pricing reform, signalling hope for a deal with Democrats on the bipartisan initiative to lower the cost of prescriptions. In late 2019, Trump was swift to reject a House bill that would allow the government to negotiate the price of drugs with companies.

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