The President is now expected to release his budget on May 23. That budget will outline the specifics of the significant cuts the President had proposed in his earlier this year. It may also shine some light on other parts of the President’s proposals including his tax cut package, changes regarding government reorganization and government regulation.
At least one Washington-based publication was reporting that the budget will include $800 billion in cuts to entitlements, mandatory programs and income-tested programs. This figure would leave the two biggest entitlement programs and parts of the federal budget, Social Security and Medicare alone. The cuts would apply to Medicaid and these would be in addition to what is being proposed under the AHCA.
In all likelihood, the President’s budget will propose the elimination of the Social Services Block Grant (SSBG) but that $1.7 billion ($17 billion over ten years) is small in comparison to a total of $800 billion in cuts. Other prime budget cut targets could be the SSI for children program, the Pell Grant student loan program, possibly child support, the Supplemental Nutrition Assistance Program (SNAP), and other nutrition programs. Beyond that there is not much to cut in entitlements and means tested programs once you exempt Social Security, Medicare, and veteran’s programs.
For 2017, projected costs for Social Security including disability ($944 billion), Medicare ($708 billion) and Veterans ($108 billion) total more than $1.7 trillion of the total $2.5 trillion in mandatory/entitlement spending. Achieving $800 billion in cuts—even spread out over ten years—in addition to the health care legislation proposed cuts would be severe.
The House will not begin to work on their 2018 budget resolution or overall plan until June. Both the Senate and House Budget Committees will likely have a draft document but will not pass anything out of concern that a new budget resolution would vitiate the current 2017 budget reconciliation instruction which allows Congress to fast-track any health care repeal bill. It is not clear whether the next budget resolution for 2018 would include a reconciliation to enable Congress to fast-track a tax cut package. This week the House Ways and Means Committee is expected to have their first hearing on tax reform.
Without a budget resolution passed, appropriators will likely act without a final budget resolution holding the draft behind closed doors until they have finished with health care reform. In such a scenario committees might know their appropriations allocations and be operating under that spending target but it may not become public.