Trump's budget big on defence, security - and the federal deficit

US President Donald Trump taking part in a meeting on infrastructure with state and local officials in the White House on Feb 12, 2018.
US President Donald Trump taking part in a meeting on infrastructure with state and local officials in the White House on Feb 12, 2018.PHOTO: AFP

WASHINGTON - President Donald Trump has proposed a budget that provides for a sharp spike in defence spending, a reduction in funding for the Environmental Protection Agency (EPA) and the State Department, among others, as well as cutbacks in social spending.

It also provides US$18 billion for one of his pet projects - building the wall on the border with Mexico - and more money for Homeland Security to curb illegal immigration.

The budget was no surprise given Mr Trump's priorities.

"We're going to have the strongest military we've ever had, by far," he said in an Oval Office appearance on Monday. "In this budget we took care of the military like it's never been taken care of before."

Under US law, Congress controls the government's purse strings and lawmakers rarely enact a presidential budget which essentially is the first opening gambit for a bargaining session.

White House budget director Mick Mulvaney acknowledged as much when he told journalists on Monday that "the executive budget has always been a messaging document."

President Trump has allocated some US$686 billion ($910b) to the Pentagon - a 10 per cent jump over the previous year - with more money set aside for an additional 25,900 troops, as well as major investments in aircraft, ships, ground systems and missile defense.

 

But the proposed budget, which would add US$7 trillion to the federal deficit over the next 10 years, immediately stirred controversy on both sides of the political divide.

Changes to social programmes like food stamps for the poor - which the budget replaces with delivered boxes of only American-produced food - triggered sharp criticism, particularly from among Democrats.

Senator Bernie Sanders, ranking member of the Senate Budget Committee, said: "This is a budget for the billionaire class, for Wall Street, for corporate CEOs, for defence contractors and for the wealthiest people in this country. It must be defeated."

Senate Minority Leader Charles Schumer called it "astounding" coming on the heels of a tax cut that alone could balloon the deficit.

"If Americans want a picture of who President Trump works for, the combination of the tax bill and this budget makes it crystal clear. He's for the rich and powerful at the expense of the middle class," Mr Schumer said in a statement.

Republican Congressman Ed Royce, chair of the House Foreign Affairs Committee, while welcoming some reforms in overseas development finance, protested against the proposed cuts to the State Department budget.

"A strong, bipartisan coalition in Congress has already acted once to stop deep cuts to the State Department and Agency for International Development that would have undermined our national security. This year, we will act again," he said.

"Diplomacy helps keep America strong and our troops out of combat. Our country faces urgent threats from North Korea, Iran and terrorists around the world. Programmes that are vital to our national interests should be prioritised," he added.

For many, the last straw is the deficit.

Ms Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said "fiscal recklessness" had been taken to a new level."

The spending plan was based on estimates that the US economy would grow by three per cent annually for the next six years, a rate many economists described as unrealistic even given the short-term bump from the massive tax cuts approved in December.