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Trump Budget Seeks Deep Non-Defense Appropriations Cuts, in Break With Bipartisan Agreement — David Reich & Jennifer Beltrán

Summary:
The Trump Administration’s 2021 budget calls for major new cuts in programs funded through non-defense appropriations. This budget category, often called non-defense discretionary (NDD), supports veterans’ medical care, aid to education, environmental protection, low-income housing, scientific research, infrastructure, public health, national parks, justice and law enforcement, job training, and many other important services and investments.[1]"THE BUDGET ABANDONS THE BIPARTISAN AGREEMENT REACHED LAST YEAR THAT PROVIDED A MODEST BILLION INCREASE FOR THIS CATEGORY IN 2021, AND INSTEAD CALLS FOR CUTTING NDD FUNDING BILLION."The budget abandons the bipartisan agreement reached last year that provided a modest billion (0.8 percent) increase for this category in 2021, and instead

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The Trump Administration’s 2021 budget calls for major new cuts in programs funded through non-defense appropriations. This budget category, often called non-defense discretionary (NDD), supports veterans’ medical care, aid to education, environmental protection, low-income housing, scientific research, infrastructure, public health, national parks, justice and law enforcement, job training, and many other important services and investments.[1]

"THE BUDGET ABANDONS THE BIPARTISAN AGREEMENT REACHED LAST YEAR THAT PROVIDED A MODEST $5 BILLION INCREASE FOR THIS CATEGORY IN 2021, AND INSTEAD CALLS FOR CUTTING NDD FUNDING $46 BILLION."The budget abandons the bipartisan agreement reached last year that provided a modest $5 billion (0.8 percent) increase for this category in 2021, and instead calls for cutting NDD funding $46 billion below its 2020 level[2] — a 7 percent overall reduction (9 percent after adjusting for inflation). This reduction is spread throughout most non-defense agencies, with proposed inflation-adjusted cuts of 28 percent for the Environmental Protection Agency, 17 percent for the Department of Housing and Urban Development, 15 percent for the Department of Transportation, 11 percent for the Department of Health and Human Services, and 10 percent for the Department of Education, to give just a few examples.

The budget also envisions ever-deeper NDD cuts in years after 2021, reaching 38 percent in inflation-adjusted terms by 2030. Cuts of this magnitude would necessarily mean a major scaling back in most activities funded through NDD appropriations....
President Trump breaks bipartisan agreement by transferring funding from general welfare expenditure to military expansion and to offset his previous tax cuts and planned tax cuts. The absolute amount of spending may remain about the same as projected, although the president is also trying to reduce the deficit. The difference is in the distributional effects, making defense contractors and the wealthy better off while increasing distributional asymmetry.

Center on Budget and Policy Priorities
Trump Budget Seeks Deep Non-Defense Appropriations Cuts, in Break With Bipartisan Agreement

David Reich & Jennifer Beltrán
Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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