President Donald Trump's budget aims to drive economic growth through tax cuts and regulatory reform, bolster the military through defense spending, and achieve balance within a 10-year window, according to White House officials.
The proposed budget cuts tax rates, eliminates loopholes and deductions, and attempts to reform the tax code to make it simpler and fairer. Trump plans to cut the corporate tax rate to 15 percent and reduce the number of tax brackets from seven to three, which include rates of 10, 25, and 35 percent. These tax cuts are the biggest cuts seen in history and will spur investment, create jobs, and increase economic growth, according to the White House.
The plan also attempts to spur economic growth by rolling back red tape on businesses. Reforming the regulations imposed by the Obama administration will generate cost savings of anywhere from $600 million to $1.2 billion, the White House said.
While the plan does not make any cuts to Social Security or Medicare benefits, the budget does attempt to reform the welfare system. Reforms to the food stamp program, the Temporary Assistance for Needy Families, the Earned Income Tax Credit, and the Child Tax Credit programs save a combined $274 billion over 10 years by encouraging work and enforcing stricter requirements on eligibility.
Director of the Office of Management and Budget Mick Mulvaney said they will begin to measure these programs by how many people they actually help.
"There’s a certain philosophy wrapped up in the budget, and that is that we are no longer going to measure compassion by the number of programs or the number of people on those programs," he said. "We're going to measure compassion and success by the number of people we help get off of those programs and get back in charge of their own lives. We're not going to measure our success by how much money we spend, but by how many people we actually help."
The plan attempts to bolster the military by requesting $54 billion for the Department of Defense and other national defense programs. The budget aims to increase the number of military members by 56,400 by 2018 and build 84 fighter aircrafts and eight battle force ships. This investment, according to the White House, would allow the military to be rebuilt by creating a more lethal joint force.
The budget also increases spending by $2.6 billion for Customs and Border Protection to stop illegal immigration. The $2.6 billion includes $1.6 billion for new and replacement border walls and the remainder for aircraft to detect border crossings, equipment including vehicles, weapons, computers and radios, surveillance technology, and road construction and maintenance for hard-to-reach areas. The budget also spends $300 million on increasing the number of agents, officers, investigators, and attorneys at CBP and Immigration and Customs Enforcement.
Mulvaney also said the budget includes "more money for national security, more money for border security—and that means bricks and mortar for a wall, technology people, infrastructure at the border."
"It also means more money for law enforcement at the federal and the state levels," he said. "It means more money for veterans, more money for school choice."
While the Obama administration increased the national debt from $10.6 trillion to $20 trillion in eight years, the Trump budget attempts to reduce the deficit and repay the debt in full.
"Unlike any budget proposed by the previous administration, the Fiscal Year 2018 budget achieves balance within the 10-year budget window and begins to reduce the national debt within that same window," the White House said. "By 2027, when the budget reaches balance, publicly held debt will be reduced to less than 60 percent of GDP, the lowest level since 2010, when the economic policies of the last administration took effect."
"Under this plan, the debt will continue to fall both in nominal dollars and as a share of GDP, beyond that point, putting us on a path to repay the debt in full within a few decades," the White House said.
"I think it’s sad that the previous administration was willing to admit that we couldn’t get better than 1.9 percent growth over the next 10 years," Mulvaney said. "That assumes a pessimism about America, about the economy, about its people, about its culture that we're simply refusing to accept. We believe that we can get to 3 percent growth."
"That's what we're trying to get back to, and that's what this budget is part and parcel of," he said. "It drives our tax reform policy, our regulatory policy, trade, energy, welfare, infrastructure, and our government’s spending priorities. Everything is keyed to getting us back to 3 percent."