FY 2018 Trump Budget: Top 10 Things You Should Know
The Trump Administration released the President's FY 2018 Budget on Tuesday, May 23, launching a contentious and consequential debate over America's priorities.
FY 2018 Budget: Major Clashes Expected on Appropriations, Tax Cuts, Entitlement Cuts
Most analysts would agree that projected deficits are unsustainable. Annual federal deficits, under current policies, are projected by the nonpartisan Congressional Budget Office (CBO) to increase from nearly $500 billion in FY 2018, to $1 trillion in 2022, to $1.4 trillion in 2027. Federal debt (owed to the public) is projected to rise from 77% of GDP in 2018 to 89% in 2027, 113% in 2037, and 150% of GDP in 2047; and within 10 years, annual federal interest payments will exceed three-quarters of a trillion dollars.
All of this underscores the need for long-term stabilization of debt as a percent of GDP. However, as explained below, the Trump Budget's claim to balance the Federal budget is based on unrealistic economics, dubious savings, unfunded investments, ignoring trillions in tax cuts, and spending cuts impacting the most vulnerable Americans and those who have fallen on hard times.
Administration will release the President's FY 2018 Budget on Tuesday, May 23, launching a contentious and consequential debate over America's priorities. OMB Director Mulvaney will testify at House Budget Committee on 5/24 and Senate Budget Committee on 5/25.
Healthcare: ACA Repeal-and-Replace
Five Major Pieces to this Year's Contentious Budget Debate:
[1.] Appropriations Impasse or a New Bipartisan Budget Deal?
[2.] Cutting Entitlements $500 - $800 billion over 10 Years
[3.] Individual and Business Tax Cuts, Reforms
[4.] Balancing the Budget vs. Investment & Infrastructure
[5.] Debt Ceiling...
The House on Thursday, May 4, narrowly approved 217-213 a revised bill (HR 1628, "American Health Care Act") to repeal and replace the Affordable Care Act (Obamacare), although the measure faces uncertainty in the Senate. The House passed the bill without Congressional Budget Office (CBO) estimates of the number of Americans likely to lose health insurance coverage or the legislation's overall cost. Below is a summary of the bill's impact and cost approximations based on previous versions of the bill.
First, it is useful to put Obamacare in context. America has a diversity of healthcare approaches:
- About half of all Americans have employer-provided insurance.
- About 1-in-5 have Medicaid, which is an entitlement for low-income Americans, under which the Federal and State governments share the cost of paying healthcare providers.
- About 1-in-6 have Medicare, which is government-provided national health insurance (otherwise known as "single payer"), paid for by payroll taxes, general tax revenues, and premiums.
- About 2%, most Veterans, Military, and some Indian Tribes, receive care at government facilities from government physicians.
- Others, who can afford it, purchase private health insurance.
- Obamacare is aimed at providing access to health care for uninsured Americans through a hybrid approach: (1) expanding Medicaid to cover Americans up to 138% of the federal poverty level (31 States and DC participate); and (2) government subsidies to purchase private insurance on State or Federal exchanges for people between 138% and 400% of federal poverty level.