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Trump's budget to slash foreign aid and green-energy funding

Rick Newman
Senior Columnist

President Trump has unveiled a “skinny budget” that calls for a major boost in spending on defense and border security, while slashing funds spent on foreign aid, environmental protection, public housing, medical research, arts and humanities and programs Trump feels are a poor use of taxpayer money.

Mick Mulvaney, director of the Office of Management and Budget, described Trump’s spending blueprint as “the America-first budget,” in a briefing for reporters. “We wrote it using the president’s own words,” he said.

The “skinny budget” is typically sent to Congress by first-year presidents who haven’t had the time or staff to develop a full budget request, which the White House normally delivers to Congress by early February. Trump’s skinny budget outlines spending priorities for fiscal year 2018, which will start Oct. 1. Most provisions would have to be approved by Congress, with legislation involving cutbacks likely to be highly contentious. The White House should deliver a fuller budget request for FY2018 by May.

President Donald Trump

Trump has already said he wants to increase defense spending by $54 billion per year, including an extra $2 billion in the Energy Dept. budget for nuclear weapons. He wants to fund that increase by a like amount of cutbacks in other agencies, so there’s no net addition to the 2018 deficit, which is forecast to be nearly $500 billion. The additional defense spending would be a 10% hike for the Pentagon. Trump also wants to boost spending on border security by about 6% in 2018. Besides the requests for 2018, Trump also wants to ask for some additional funding in the current fiscal year, including $30 billion for defense and $1.5 billion to get started on the border wall Trump promised while campaigning.

[Related: Test Trump’s budget using our “aircraft-carrier index”]

The biggest cutbacks would come from the State Department, which would lose $10.1 billion in funding, mostly for foreign aid. “This is a hard power budget,” Mulvaney told reporters. “It is not a soft power budget. This president wants to send the message to allies that this is a strong power administration.”

The Environmental Protection Agency is slated for a $2.6 billion cut, or 31% of its 2017 budget. “You can expect reductions in parts of the EPA that don’t line up with the president’s views on things like global warming and alternative energies,” Mulvaney said. Trump would slash $5.8 billion from the National Institutes of Health, an 18% cut, and $6.2 billion from Housing and Urban Development, a 13% decline. Here’s a breakdown of Trump’s budget by agency, with 3 agencies that would get more funding highlighted in green and 15 agencies that would lose money highlighted in yellow:

Source: Office of Management and Budget

Trump also wants to eliminate funding for 19 small programs, including arts and humanities endowments and the Corporation for Public Broadcasting, which helps fund public TV and radio stations. Such programs typically garner less than $1 billion each in annual funding, yet some conservatives view them as activities that should be funded by the private sector, not by taxpayers.

The Trump cuts would come entirely from the “discretionary” portion of the federal budget, which includes things Congress must fund on a year-to-year basis. That excludes so-called entitlement programs such as Medicare, Medicaid and Social Security, which pay out money to beneficiaries automatically, without the need for regular appropriations by Congress. Trump’s budget doesn’t touch any of those programs, although the Republican health-reform bill drawn up by House Speaker Paul Ryan—which Trump supports—would sharply cut Medicaid payments during the next decade.

The skinny budget excludes other big Trump priorities, such as tax reform and a plan to boost infrastructure spending. Those plans are coming later, although Mulvaney did say the skinny budget will include some cuts to infrastructure programs sprinkled throughout various agency budgets, “because we believe those programs to be less efficient than the package we’re working on for later this year.”

Key legislators, including some Republicans, have already shot down some of the spending cuts Trump is pushing. Republican Sen. Lindsey Graham said any plan to slash foreign aid would be “dead on arrival,” for instance, and even Sen. Majority Leader Mitch McConnell said such a bill probably wouldn’t pass. But boosting defense spending without corresponding cuts elsewhere would rouse Republican budget hawks who insist Trump’s budget must not add to the national debt. The skinny budget is likely to get a lashing by the time 2018 finally arrives.

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Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman