Trump is about to run into the budget reality

Kimberly Adams Feb 28, 2017
HTML EMBED:
COPY
President Donald Trump will outline his first budget proposal tonight. Alex Wong/Getty Images

Trump is about to run into the budget reality

Kimberly Adams Feb 28, 2017
President Donald Trump will outline his first budget proposal tonight. Alex Wong/Getty Images
HTML EMBED:
COPY

President Donald Trump has his big speech tonight, and one of the issues he’s expected to talk about is the budget. On the campaign trail and in speeches, Trump has made budgeting sound easy: You cut here, add there and you’re done, sort of the way businesses run their processes. But the federal budget is not a zero-sum game — there are political pressures,and many items that simply can’t be cut.

Trump would like to run the government like a business, but when it comes to the budget, there are some key differences. For one, members of Congress, who have to pass the budget, are not Trump’s employees.

“In a business, he can say, ‘You’re fired’ to people who don’t cooperate,” said Joe White of Case Western Reserve University, who has been studying the budget process for decades. “Whereas he can’t fire Paul Ryan and he can’t fire any senators.” 

Another difference: Cutting spending from one area doesn’t necessarily free up money for something else, because of politics. 

Budget caps previously passed by Congress enforce the idea of parity, which “basically means that any increase in military spending would be matched by a corresponding increase in domestic spending,” said Lindsay Koshgarian, a research director at the nonpartisan National Priorities Project. “And of course, Trump’s proposal throws all of that away.” 

Trump wants a $54 billion increase in defense spending, partly paid for by cutting non-defense spending. But, he can’t do that without Congress. 

Bill Hoagland, a senior vice president at the Bipartisan Policy Center, said there’s a reason Trump is targeting this discretionary spending.

“This is, in some ways, an easy area to address because we’re leaving off the table the fastest-growing components of spending,” Hoagland said. Those are entitlements, like Social Security and Medicare, which make up about two-thirds of the federal budget. “Unless, of course, you’re talking about increasing taxes to pay for the increased spending,” Hoagland said. 

It’s unlikely Trump would want to suggest that in his prime time speech today. 

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.