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Federal Budget Priorities:. What's the local impact of federal spending and revenue decisions? Spotlight on Military Spending and Massachusetts. What's at Stake?.
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Federal Budget Priorities: What's the local impact of federal spending and revenue decisions? Spotlight on Military Spendingand Massachusetts
What's at Stake? “I don't want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.” Grover Norquist
February Early Spring Late Spring Budget Process Historically, the first Monday of every February, the President sends a proposed budget plan to Congress. The FY2012 budget was released on February 14, 2011. Congress carries out a series of evaluations ultimately passing a budget resolution. Congressional Subcommittees ‘Markup’ Appropriation Bills.
LateSpring Early Fall Sept. 30th Budget Process The House & Senate vote onAppropriation Bills andreconcile differences. President signs the bill approvedby Congress and the Senate, andthe budget is enacted.
What does this really mean? Congressional Budget Resolution 12 Appropriators: House &Senate Agriculture Commerce,Justice &Science Defense Energy &Water FinancialServices HomelandSecurity Interior &Environment Labor, HHS &EducationFY 2012HHS = $885.8B LegislativeBranch MilitaryConstruction &Veterans'Affairs State &ForeignOperations Transportation& Housing& Urban Dev. Head Start = $8.1B MA = $124.7 M LIHEAP = $1.98B MA = $81.7M TANF = $17.7B MA = $459.4M
What does this have to dowith you? Flow of most federal funds and cuts Federal Agency / Department State Agency / Department County, City, Town Individual Taxpayer
FY2012The Whole $3.7 Trillion Pie Mandatory Spending Includes: Social Security, Medicaid, Medicare, Food Stamps, CHIP Funding is need-based & non-negotiable Discretionary Spending Includes: Energy, Environment, Science, Transportation, Education Funding determined on an annual basis Interest 6% Mandatory 59% Discretionary 34%
FY2012Projected Revenues by Source Social Insurance 25% Borrowing 29% Corporate 9% Individual 31%
FY2012The Mandatory Budget Unemployment 4% Medicare 20% Other 45% Social Security 31% $2.44 Trillion
The ProposedDiscretionary Budget Environment, Energy & Science 6% Transportation 2% Income Security & Labor 2% Military Spending 58% International Affairs 4% Health 5% Housing and Community 5% Government 6% Food 1% $1.24 Trillion Education 6% 5% Veterans' Benefits www.NationalPriorities.org
Key Aspects of2012 “Security” Spending • $553 billion for Pentagon base budget • $118 billion for war • $19.3 billion for nuclear weapons • $7.8 billion for “misc.” • $6.6 billion in military aid to “foreign” nations • What about veterans and homeland security?
How Much Since 9/11?$7,600,000,000,000,000 • Pentagon: $5.6 trillion • Wars: $1.36 trillion • Homeland Security: $636 billion
Impact: The DiscretionaryBudget Crossroads Billions of $2010 Military Recovery Act Domestic International Affairs Budget of the U.S. Gov't, FY 2011
Impact: Where Federal Funds Land in Our Communities Where Federal programs Schools Head Start, Title I City Hall Infrastructure (water, transit, roads, bridges) Housing Authority Housing assistance Community/Antipoverty Early childhood, economic development, social services block grant, weatherization, LIHEAP, youth programs, food and hunger programs State Agencies Medicare, Medicaid, TANF, SNAP, CHIP, Jobs programs Employment agencies Unemployment benefits, job training, jobs Colleges Pell grants, student loans, grants to schools
The Budget's Story Paul Ryan's Plan $6.2 trillion in cuts over 10 years • Cuts corporate and individual tax rates • No cuts to Pentagon • Adds $5.1 trillion to the debt through FY2021 • Largely restructures entitlements
The Budget's StoryThe CPC Plan Budget surplus of $30 billion by FY2021 v. Ryan which projects a deficit of $400 billion • Revenue increases (corporate and wealthy) • Cuts security spending; raises non-security spending • Maintains entitlement spending
The Budget's StoryThe Budget Control Act Part One: $917 billion Defense “Security” Old Paradigm New Paradigm
The Budget's StoryThe Budget Control Act Part Two • Raises debt ceiling by $900 billion instantly ($2.1 trillion total) • Creates “Super Committee” • A mandate of an additional $1.2 to $1.5 trillion in deficit reduction • Anything less than $1.2 trillion = Sequestration
The Budget's StoryThe Budget Control Act Sequestration • If Super Committee recommends anything less than $1.2 trillion • Cuts split 50/50 between Defense and Non-Defense • Sequestration is only cuts; no revenues, no entitlement reforms
The Budget's StoryThe American Jobs Act Obama's $4 trillion vision: • $1.2 trillion in discretionary cuts (already in process) • $1.1 trillion from draw down in Afghanistan and Iraq • $580 billion from mandatory cuts • $430 billion from saved interest payments
The Budget's StoryThe American Jobs Act Obama's $4 trillion vision: • $1.5 trillion from increased revenue • Upper income tax cuts (2001 and 2003) expire:$866 billion • Limited deductions and exclusions for those making more than $250,000/yr.: $410 billion • Closing loopholes and eliminating special interest tax breaks: $300 billion
The Budget's StoryMillions of Jobs at Stake Impact of $1 billion on potential job creation in select sectors 29,100 Direct Jobs Indirect Jobs Induced Jobs 19,600 17,100 11,600 Political Economy Research Institute, 2009
Stay in touch! Jo Comerford, Executive Director, NPP www.NationalPriorities.org jo@nationalpriorities.org