Understanding the Federal Budget

Biden Administration Initial FY2022 Funding Request

On April 9, the White House released its 2022 discretionary funding request to Congress. The so-called “skinny budget” includes only some of their discretionary funding proposals. The Biden administration has said they will release a full FY2022 funding request, which will likely include tax reform proposals and changes to mandatory spending such as Social Security and Medicare, later this year. Below is a brief summary of the initial request. USAToday and the Washington Post have published more in-depth analyses. 

The proposal tracks closely with President Biden’s key infrastructure proposals, the American Jobs Plan and the American Families Plan. The budget request highlights the four issues the administration seeks to address: the COVID-19 recovery, the ongoing economic crisis, racial inequity, and climate change.

In addition, the Administration has put forward a summary of their funding for the Department of Treasury. The president requested $14.9 billion for the Department's domestic programs, a 10.6 percent increase from 2021. This includes:

  • $13.2 billion for the IRS, a 10.4 percent increase from 2021; and an additional $417 million for tax enforcement. This additional funding according to the Administration would enable the IRS to increase oversight and ensure tax compliance.
  • $330 million for Community Development Financial Institutions (CDFIs), a 22.2 percent increase from 2021. CDFIs offer loans to small businesses to promote community revitalization projects and affordable housing.
  • $191 million for the Financial Crimes Enforcement Network (FCEN), a 50 percent increase from 2021. This would allow the FCEN to better combat the use of complex corporate structures to shield illegal activity.

The rest of the request includes the first increases to domestic spending in four years, along with modest increases in defense spending. The proposal totals $1.52 trillion, an 8.4 percent increase from 2021. These changes include:

  • Agriculture: $27.8 billion, a 16 percent increase.
  • Commerce: $11.4 billion, a 28 percent increase.
  • Defense: $715 billion, a 1.6 percent increase.
  • Education: $102.8 billion, a 41 percent increase.
  • Energy: $46.1 billion, a 10.2 percent increase.
  • Health and Human Services: $133.7 billion, a 23 percent increase.
  • Homeland Security: $52.0 billion, roughly equal to 2021.
  • Housing and Urban Development: $68.7 billion, a 15 percent increase.
  • Interior: $17.4 billion, a 16 percent increase.
  • Justice: $35.2 billion, a 5.3 percent increase.
  • Labor: $14.2 billion, a 14 percent increase.
  • State and international programs: $63.5 billion, a 12 percent increase.
  • Transportation: $25.6 billion, a 14 percent increase.
  • Veterans Affairs: $113.1 billion, an 8.2 percent increase.
  • Army Corps of Engineers – Civil Works: $6.8 billion, a 12.9 percent decrease.
  • Environmental Protection Agency: $11.2 billion, a 21.3 percent increase.
  • National Aeronautics and Space Administration: $24.7 billion, a 6.3 increase.
  • National Science Foundation: $10.2 billion, a 20 percent increase.
  • Small Business Administration: $852 million, a 9.4 percent increase.
  • Social Security Administration: $14.2 billion, a 9.7 percent increase.

Historically, budget proposals put forward by administrations have served as a messaging document for laying out a president’s priorities for the upcoming fiscal year, as opposed to an actual starting point for Congress to draft a budget. 

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