Understanding the Federal Budget

The President’s 2021 Budget Proposal

President Donald Trump unveiled his 2021 budget on Monday. It outlines significant cuts in domestic programs and consolidations likely to be unpopular with Congress, especially in this election year.

The annual budget process begins with a President’s budget request that is submitted to Congress and includes funding requests for all federal executive departments and independent agencies.

President Trump’s proposal, A Budget for America's Future, seeks $4.4 trillion in savings over a decade which would be achieved, in part, through cuts in the federal safety net. It reflects efforts to cut Medicare and Medicaid spending and anticipates significant savings from a Trump Administration “health reform vision” comprised of efforts to end “surprise” medical bills, roll back regulations, and overhaul Medicaid.

The President’s budget proposal also calls for 22 percent in cuts to foreign aid, impacting programs dedicated to addressing global health, humanitarian crises, food security, safe water, and good governance around the world.

A snapshot of Executive Branch agencies’ proposed budget figures:

  • Agriculture:$21.8 billion — an 8 percent cut from current funding.
  • Commerce:$8.1 billion — a 37 percent cut from current funding.
  • Defense:$636.4 billion — a less than 1 percent increase over current funding.
  • Education:$66.6 billion — an 8 percent cut from current funding.
  • Energy:$35.4 billion — an 8 percent cut from current funding.
  • Health and Human Services:$96.4 billion — a 9 percent cut from current funding.
  • Homeland Security:$49.7 billion — a 3 percent increase over current funding.
  • Housing and Urban Development:$47.9 billion — a 15 percent cut from current funding.
  • Interior:$12.7 billion — a 13 percent cut from current funding.
  • Justice:$31.7 billion — a 2 percent cut from current funding.
  • Labor:$11 billion — an 11 percent cut from current funding.
  • State and international programs:$44.1 billion — a 21 percent cut from current funding.
  • Transportation:$21.6 billion — a 13 percent cut from current funding.
  • Treasury:$15.7 billion — a 1.5 percent increase over current funding.
  • Veterans Affairs:$105 billion — a 13 percent increase over current funding.
  • Corps of Engineers:$6 billion — a 22 percent cut from current funding.
  • EPA:$6.7 billion — a 27 percent cut from current funding.
  • NASA:$25.2 billion — a 12 percent increase over current funding
  • National Science Foundation:$7.7 billion — a 7 percent cut from current funding.
  • Small Business Administration:$700 million — an 11 percent cut compared to current funding.

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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