Trump’s budget plans

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On Monday, President Donald Trump released his budget plans for the fiscal year of 2019. Controversy is never far away from finding the President and, once again, controversy has found him. Trump’s new budget outlines are predicted to add $7 trillion to the country’s debt over the next decade, according to a report out of the New York Times. The proposed plans by the President are adjudged to go against Republican ideals of trying to bring down the federal budget debt and deficit. Republicans, as well as Democrats, were quick to criticise Trump’s movements, with a few voicing their concerns at raising the deficit and this could be crucial in determining whether or not the budget will pass Congress.

It’s fair to say that Trump’s idea to not reduce the deficit goes with the majority of American citizens’ feelings, with only 48% saying that reducing the federal deficit should be a top priority for the President. Out of those surveyed, 73% believe that defending the country from a terror attack is more of a priority in terms of spending, this is all in accordance with a January Pew Research Centre survey. The problem that lies for Trump and his budget plans is that 59% of Republicans and those who lean towards Republican, (according to Pew Research Centre’s recent survey), believe that reducing the deficit is a top priority, and this could lead to difficulties in Congress. The people that surround the President believe that reducing the federal deficit is more important than the general population does. However, the percentage of Republicans who believe in reducing the deficit has dropped. In 2013, 84% of Republicans said that reducing the deficit was a top priority, and over the years that has declined. Last year, when Trump took office, 63% of Republicans believed that reducing the deficit was a top priority, this according to the Reuters/Ipsos poll. The decline of overall caring to reducing the deficit comes down to the result of an economy that grew well under the Obama administration. People seemed to turn away from the matter as a top priority to handle, as the economy was improving. With Trump’s budget plan set to raise the deficit and the with the public’s lack of interest in reducing the budget, it’s likely that Trump’s plans could get stopped when going through Congress, especially if raising the deficit gets in the way of top priorities. Republican lawmakers are likely to care very little about raising the deficit and so will look to replace ideas with plans from the forthcoming Congressional budget.

So what does Donald Trump’s latest budget plan shape up to look like?

Here is an overview:

Firstly, one of the main proposals within the budget is the $236 billion reduction in Medicare over the next ten years. This is the social insurance programme created by the US government and, over the next decade, there will be spending cuts to the programme. As well as cuts to Medicare, the plans also outline cuts in spending to food stamps for the poorest, housing vouchers and health insurance. Congress will have the final say on the plans and it is important to know that they rarely pass budget plans set out by the President. However, it is no doubt that this budget reflects strongly the Trump administration’s feelings on what to prioritise when it comes to spending, and the President’s rhetoric itself. Major criticism from the side of the Democrats came from John Yarmuth, who is a leading Democrat on the House of Representatives Budget Committee. He said: “These cuts to critical federal investments are so extreme they can only reflect the disdain for working families and a total lack of vision for a stronger society.”

The White House has claimed that these cuts will help lower the federal budget deficit by more than $3 trillion over the next 10 years. All in all, Trump’s $4.4 trillion budget proposal will provide an estimated $716bn in spending on defence, such as military programmes and the US nuclear arsenal. The budget also outlines a somewhat less than substantial amount of money for the infrastructure sector. Around $200bn has been allocated for infrastructure over the next 10 years. The amount of money allocated towards infrastructure has angered many, including House Democratic Leader, Nancy Pelosi, who called it a “puny infrastructure scam.” Has she got a point? Well, it seems so. The President asked Congress to pass what he is labelling as the “biggest and boldest” infrastructure plan, but with only around $20bn every year, for the next 10 years, going towards all things infrastructure- roadways, railways and waterways, you can hardly call it the “biggest” infrastructure plan. It’s clear to see that Trump is setting out a precedent with funding for infrastructure. The $200bn federal investment has been done in the hope that private investors, states and localities will begin to invest at least $1.5 trillion in infrastructure projects throughout the US. At the beginning of a meeting with state and local officials on infrastructure, the President made himself clear with what his intentions are for federal funding within the infrastructure sector: “If you want it badly, you’re going to get it,” he said, “and if you don’t want it, that’s OK with me too.”

You can’t deny that the President understands the need for stronger investment in infrastructure, but to what extent does he understand it? He said, “Our roads are in bad shape, and we’re going to get the roads in great shape. And, very important, we’re going to make our infrastructure modernised. And we’re really way behind schedule. We’re way behind other countries.” Trump isn’t wrong, America’s roads are in bad shape, along with their railways, and they are way behind other countries in terms of progress made in updating transportation systems. However, the incoherency in his language, coupled with the lack of funding allocated to the sector, shows you enough how little he understands about just how major the problem in America currently is.

How does this federal investment plan for infrastructure break down, then?

According to the Associated Press, officials have said that the $200bn in federal funding would come from cuts to existing programmes. Around $100bn would go towards grants for transportation, water, flood defence, and clean up at some of the United States’ most polluted places. From what is left of the budget, $50billion is set to go towards rural projects, transportation, broadband, water, waste, power and ports. Bring in an argument from the Republican side. Some Republican senators have voiced their concerns for rural Republican states. They believe that the administration’s ambition to have public-private partnerships would do very little in helping to solve rural states’ infrastructural problems. Brendan Doyle, a Democratic congressman, accused Trump’s latest proposal as falling short of the $1 trillion he promised during his campaign – a pledge that was one of his few that was widely supported by Democrats at the time.

In the grander scheme of things, this outlined plan will have to rely on great economic growth of around 3% over the next three years. As well, the White House has expanded the timeline of when they plan to eradicate the deficit. Instead of having it gone in the next 10 years, they look to stretch that until 2039.