Wednesday, April 10, 2013

Obama Budget Reprises Past Themes While Setting Administration's 2014 Agenda

Normally an inside-the-beltway, drama-filled event, this year's late release by  President Obama of his federal budget proposal has registered only a slight blip thus far on the Washington, DC political Richter scale, coming as it has two months later than usual, and following passage last month of both Republican House and Democratic Senate budgets.  White House officials say the President is trying to strike a balance between the House and Senate plans.  It would spend $3.77 trillion over the coming 2014 fiscal year, and proposes to start closing annual deficits by raising taxes on those earning higher incomes and by closing business "tax loopholes."  The Administration's budget includes familiar themes from past years' plans (made before without success), including curbing farm subsidies and increased spending for infrastructure projects.  The President's plan repeats the $1.8 trillion deficit reduction package that he offered the GOP during budget negotiations with House Speaker John Boehner (R-OH) in December 2012; negotiations that Boehner walked away from over his opposition to higher taxes on the wealthy.

The proposal differs from the President's budget presented last February (2012) in that it puts forward a new, government-wide inflation adjustment plan; one that would affect Social Security, veterans' pensions and the indexing of tax brackets.  The adjustment is being offered to Republicans in the hope of winning concessions on the increased tax revenues.  A scant few Republicans have welcomed Obama's proposal to reduce the size of future cost-of-living increases.

Senior administration officials previewed the details of the proposal on Tuesday, releasing a related "Fact Sheet" earlier in the morning.  The officials said that the plan represents a "fiscally responsible plan for middle-class jobs and growth" that it "turns off" the $1.2 trillion in automatic sequestration spending cuts that took effect earlier this year.

Even before the proposal's release, Republicans raised objections to its call for tax increases and lack of spending cuts, while some Democrats opposed the plan's proposed cuts to entitlements programs, such as Social Security and Medicare.   An early test of whether Republican leaders might be willing to consider Obama's budget offer will come Wednesday night, when Obama has scheduled a White House dinner with a dozen Republican Senators, and when, surely, the budget will be discussed.

Among water resource and environmental issues highlighted in the Administration's budget "Fact Sheet" are proposals to:
  • Expedite "infrastructure projects by modernizing the Federal permitting process to cut through red tape while creating incentives and better outcomes for communities and the environment."
  • Establish the goal of "cutting timelines in half for major infrastructure projects in areas such as highways, bridges, railways, ports, waterways, pipelines, and renewable energy."
  • Realize savings from mandatory programs, such as reductions to farm subsidies.
In addition to entitlement and other mandatory spending cuts, the plan would trim $200 billion in federal discretionary spending.

The administration blames the two-month budget delay in submitting the proposal on lengthy "fiscal cliff" negotiations that took place at the end of last year, and on the subsequent early-2013 political fights over the automatic ("sequestration") spending cuts that kicked-in during March.

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