In his first budget proposal, released Thursday, President Trump proposed drastic cuts to many of the nation’s agencies and programs to offset nearly $60 billion in additional spending on defense, a down payment on the border wall and funding for school choice programs, among other things. If enacted, the proposal would be one of the most dramatic redistributions of funds since Reagan’s military build-up during the Cold War in the early 1980s.
Discretionary spending limits, the only portion of the budget addressed by this proposal, are set by congressional budget resolutions. Mandatory spending, by contrast, is set by other laws and primarily includes interest on the debt and entitlement programs such as Social Security and Medicare. Here, the funding level is often determined by the size of the benefit and the eligible population.
Proposed 2018 budget: $114.4B
The Agriculture Department, Interior Department, Energy Department, Transportation Department and the Department of Housing and Urban Development control much of the nation’s vast infrastructure.
These departments, especially HUD, lost significant funding as Reagan took office. His promise to shrink the size of the government included significant reductions in federal housing funds.
Much of the other fluctuation in these budgets has been driven by political and financial turmoil. In the late 1970s, increased oil production in response to the energy crisis caused a spike in the Energy Department’s budget. A few years later, in the early 1980s, the “farm crisis” — a period of falling crop prices and lower incomes for farmers — led to large payouts from the Agriculture Department.
More recently, as part of the stimulus following the 2008 financial crisis, many of these departments, most notably Transportation, received large budget increases. Note that though the 2009 budget was set during the Bush administration, the stimulus itself was negotiated and passed by President Obama.
With Trump’s 2018 proposal, all of these departments are looking at cuts of between 12 and 21 percent. Much of this money would be taken out of research and climate-change-related programs.
Proposed 2018 budget: $19B
The Treasury Department and Commerce Department are concerned with the government’s finances and the country’s economic growth, respectively. Their funding levels are largely driven by the state of the economy and government budgets.
Treasury saw a large bump in spending in the mid 1970s because the department loaned more than $1.3 billion (nearly $6 billion in today’s dollars) to New York City. The city government at the time was facing bankruptcy.
The departments’ funding similarly responds to nationwide financial crises; after the 2008 housing bubble burst, the Commerce Department got increased funding to respond. Financial agencies outside these departments, such as the FDIC, which insures Americans’ bank deposits, also saw spending spikes during that period (though that money is funded by insurance premiums, not Congress).
With Trump’s 2018 proposal, Treasury would see a modest 4 percent cut, largely aimed at the IRS’s funding. Commerce would see a steeper 16 percent decrease, cutting from many programs that aim to help communities struggling with the effects of climate change or manufacturing automation.
Foreign relations and law enforcement
Proposed 2018 budget: $98.9B
The State Department, the Department of Homeland Security and the Department of Justice, which focus on diplomacy and law enforcement, have grown almost continuously for the past 40 years.
A major disruption came after the 2001 terrorist attacks, after which the Department of Homeland Security was founded. (The number you’re seeing before that date is the funding allocated to all the then-independent agencies that are now part of DHS, like Immigration and Customs Enforcement.) From 2001 to 2002, the funding for these programs — which primarily focus on counterterrorism and immigration — nearly doubled. A smaller bump occurred in 2006 as part of FEMA’s response to Hurricane Katrina.
Trump’s budget proposal would make substantial changes to some of these departments. DHS is one of three departments that would see an increase in funding, which would be put toward building a wall along the southern border and increasing the number of agents throughout the immigration enforcement system, among other things. In total, the department’s funding would increase by 7 percent.
The State Department, on the other hand, would face deeper cuts than any other department, losing 29 percent of its budget. In line with Trump’s “America first” agenda, the budget proposal slashed foreign military and humanitarian aid, as well as funding to the United Nations and other international organizations. The proposal would inflict milder cuts on the Justice Department — 4 percent — and shifts money away from prison construction toward counterterrorism and the system for removing undocumented immigrants from the country.
Health, education and labor
Proposed 2018 budget: $216.5B
The Department of Veterans Affairs, the Education Department, the Department of Health and Human Services and the Labor Department have among the largest discretionary budgets in the government.
Like many other portions of the budget, they often fluctuate with the state of the economy. The biggest spikes came after the 2008 financial crisis. Between 2008 and 2009, the Labor Department’s budget went up by about 50 percent to fund more job training programs as part of the stimulus. The stimulus also increased HHS’s budget by half, funding everything from the promotion of medical technology to Head Start.
In Trump’s proposal, these departments fared quite differently. VA would see a 6 percent increase in funding to ease the backlog in the veterans’ health-care system. The Education Department is slated for a 14 percent decrease overall but an increase in funding for programs related to school choice. The Labor Department and HHS budgets would decrease by 21 and 18 percent, respectively.
Proposed 2018 budget: $66.9B
The agencies’ functions vary as widely as their budgets, and they have faced many different peaks and troughs over the past 40 years.
The 2009 stimulus had one of the biggest impacts. The budget for the General Services Administration, which helps the other agencies function, went up nearly twentyfold between 2008 and 2009, in part funding the construction and repair of government buildings around the country. The Environmental Protection Agency’s budget nearly doubled, and in the aggregate, agency budgets went up by about a third.
But many of those increases have since been reversed, and a number of these agencies face cuts in Trump’s budget. The EPA would take one of the hardest hits, losing 31 percent of its 2017 budget and a fifth of its workforce. These cuts are aimed at the agency’s research programs, particularly with regard to climate change and environmental cleanup programs. The proposal dictates smaller decreases for other agencies, like the Small Business Administration and NASA, which would receive 5 and 1 percent budget cuts, respectively.
Proposed 2018 budget: $639B
Defense has long been one of the largest items in the budget, this year comprising nearly 50 percent of discretionary spending. The largest driver of defense spending over the past 40 years has been war.
Spending increased by nearly two-thirds during the Reagan administration as he built up the military during the Cold War. It increased drastically again during the Bush administration, largely to fund the military operations in Afghanistan and Iraq.
Trump’s proposal would increase defense spending by 9 percent, about $52 billion. That’s a bit larger than what Obama was projecting for 2018, and smaller than what congressional defense hawks wanted, according to Todd Harrison, the director of Defense Budget Analysis at the Center for Strategic and International Studies. “It’s in line with what you’re expecting to see,” he said.
Whether the changes in Trump’s proposal actually get enacted is an open question. Congress writes the budget and typically makes changes to the president’s proposal. Last year, lawmakers disregarded Obama’s budget altogether.
Despite a Republican-controlled Congress, Trump’s cuts may not pass so easily. Republican lawmakers, including Sen. Rob Portman (Ohio), Sen. Dean Heller (Nev.) and Rep. Leonard Lance (N.J.), have criticized portions of the budget. And Sen. Lindsey O. Graham (R-S.C.) did not mince words after seeing a blueprint: “It’s dead on arrival.”