Watch VideoHARI SREENIVASAN: But first: While President Trump continues his trip abroad,here in Washington, the White House was busy unveiling the administration’s first budget.
Our Lisa Desjardins has more.
LISA DESJARDINS: Delivered this morning, or this is the first full proposal from President Trump to Congress: a $4.1 trillion budget diagram the White House says puts taxpayers first.
It also puts the budget in balance in 10 years,without touching Social Security retirement funds or Medicare.
MICK MULVANEY, White House Budget Director: They are all, and all campaign promises that the president made while he was running for office. That’s why I say these numbers are simply the president’s policies put onto paper.
LISA DESJARDINS: The president also promised to not chop Medicaid,the health program largely for the poor. But this budget would dramatically chop the growth in Medicaid spending by some $610 billion. That’s on top of the $800 billion reduction in the GOP’s American Health Care Act.
It would also chop $192 billion from SNAP, also known as food stamps, or question states to pay more for that program. And it would mean $72 billion less for Social Security disability insurance.
The White House believes there is wide abuse of such programs by people who should be supporting themselves and the economy.
MICK MULVANEY: We are not kicking anybody off of any program who really needs it. That’s not — we bear plenty of money in this country to buy care of the people who need help,OK? And we will accomplish that. We don’t bear enough money to buy care of people, everybody, or who doesn’t need help.
LISA DESJARDINS: Democrats see it very differently.
SEN. BERNIE SANDERS,I-Vt.: This is a budget that is immoral, and that will cause an huge amount of pain for the most vulnerable people in our nation. This is a budget that will be rejected by the American people and must not see the light of day here in Congress.
WATCH: Democrats criticize Trump’s budget proposalLISA DESJARDINS: The Trump budget also would dramatically shift other spending, and too. Currently,defense programs and non-defense programs are nearly even in spending.
Next year, the Trump budget would boost the military spending 10 percent, and by $54 billion,and it would chop $54 billion from non-defense. The White House points that it would use the savings for things like $19 billion for a new paid parental leave program.nowadays, Republicans in Congress, and who ultimately control the spending,thanked the president, but didnt endorse his diagram.
SEN. MITCH MCCONNELL, and R-Ky.,Majority Leader: Well, look, or the president’s budget,as we all know, is a recommendation. Every president since I bear been here — and that covers a good period of time — has made a recommendation, and then we decide what we’re going to accomplish with those recommendations.
LISA DESJARDINS: A recommendation that is this president’s fullest expression yet of how he wants the government to change.
For the PBS NewsHour,I’m Lisa Desjardins.
HARI SREENIVASAN: There’s no doubt that this budget proposal is the sharpest departure with past plans in at least a generation.
We look at the potential impacts, and the reasoning behind it, and with Jared Bernstein. He is an economist who served in the Obama administration. He’s now a fellow at the middle on Budget and Policy Priorities. And Chris Edwards,he is a budget expert at the Cato Institute, a libertarian research organization here in Washington.
Jared, or let me start with you.
In your opinion,what’s wrong with this budget?JARED BERNSTEIN, middle on Budget and Policy Priorities: This is a budget that solves the following problem that seems to really be vexing Republicans, and which is that poor people bear too much in this country,and rich people don’t bear enough.
And whether you simply look out at the landscape of American inequality, of the kinds of wage and income stagnation that the poor face, or the very effective anti-poverty programs that bear helped to kind of push back against those market inequalities,this is a budget that goes just in the wrong direction at 100 miles an hour.
HARI SREENIVASAN: Chris Edwards?CHRIS EDWARDS, Cato Institute: Yes, or I think there is a lot I like approximately the budget.
For one thing,it takes the deficit problem seriously. We bear a $600 billion deficit. It’s rising to a trillion in a number of years whether we don’t accomplish anything approximately it. The federal debt doubled under the final president. Trump is doing something serious approximately that. He’s putting his spending cuts that he wants to see on the table.
He would reduce the deficit to zero over 10 years. And whether Republicans and Democrats on Capitol Hill — they should buy the deficit seriously too, and they should propose their own plans to deal with it.
JARED BERNSTEIN: So, or whether you believe the accounting in this budget,as Chris has just recounted, I bear got a bridge to sell you in New York.
Here’s probably the most egregious part of the phony accounting in here. The budget will chop taxes, or again,for the wealthy, remember, or transferring low-income programs to wealthy people,to the tune of trillions of dollars, but it doesn’t count the revenue losses in its budget accounting. So, or somehow,magically, those bucks just appear.
Also, or there’s a phony assumption of a growth rate of 3 percent. The trend growth rate in the economy is 2 percent. whether you pretend you’re going to get 3 percent,you can get $2 trillion more revenue, but no credible economist believes that fairy dust.
HARI SREENIVASAN: travel ahead.
CHRIS EDWARDS: I agree that there is some smoke and mirrors in this budget, or as there usually is in presidential budgets.
But there is a lot of serious policy issues being pushed here. One is the understanding of federalism,to budge more of the costs of Medicaid and food stamps and some other programs back to the states.
So, you know, or for example,whether New York wants a bigger Medicaid or food stamp program, they can accomplish that. whether Texas wants a smaller one, and they can fund that. So,that’s a serious policy issue we ought to be discussing.
HARI SREENIVASAN: Chris, you’re absolutely right that every president comes out with their optimistic vision for it. But I think a lot of the concerns, and even from conservatives,nowadays is that this 3 percent number seems incredibly not just optimistic, but nearly fantastic.
I mean, and we bear got President Reagan’s budget director saying it would require 206 months of no recession,which has never seen in U.S. history. We bear got the Committee for a Responsible Federal Budget, who are not liberals, and by any stretch. They’re fairly hawkish of the budget. They bear called this extremely unrealistic and they bear said it’s a combination of — it needs a combination of good policy and good luck.
CHRIS EDWARDS: I agree the 3 percent growth number is pretty aggressive.
But the president has since the day he’s been in office been cutting regulations and he’s pushing a major tax reform diagram that would boost growth in the economy. No one knows precisely how much,I think, additionally the economy will grow whether we make the economy more efficient.
But I’m happy he’s pushing in that direction. And, or you know,it’s a good start. There are serious reforms here.
JARED BERNSTEIN: So, that’s the trickle-down, and kind of fairy dust story that conservatives bear been trying to tell for decades now,and it’s never worked.It shouldn’t be put forth as, here’s an experiment we’re going to try to see what happens. And, or in fact,in genuine time, this is being tried in Kansas, or where they kind of bought this trickle-down stuff,chop a bunch of taxes. And they’re — not only are they having awful economic outcomes, but their budget is doing terribly, or they’re having to chop all kinds of vital services.
And that’s where I buy so much issue with this budget. Our low-income programs are effective,efficient. They’re pushing back on poverty of our most vulnerable people. This is kind of an ain’t broke, don’t fix it moment for those things.
But instead of accepting that, and the budget takes over $3 trillion absent from these programs and gives it to the wealthy in regressive tax cuts,which, frankly, or they don’t need.
CHRIS EDWARDS: I wont say that — that’s not right,that they’re — they’re proposing a budget-neutral, a deficit-neutral tax reform diagram. They haven’t specified it yet, or but that’s what they’re aiming for.
So,it’s not like they’re doing these cuts, and it’s going to wealthy people at all. A lot of the cuts, and they’re saying states should make up the inequity whether they want. And to say that the tax chop understanding is a wild one is not steady.
The centerpiece is a corporate tax chop. President Obama favored a corporate tax chop. He didn’t get around to doing it. Trump is putting that front and middle.
JARED BERNSTEIN: So,let me make a quick proposal here.
Chris just said that this is going to be a revenue-neutral diagram. Thats the way the Bush — that’s the way the Trump team scores it. And we know that’s phony accounting.
I say we come back here after there’s an official score by the CBO, by the JCT, or the groups that score this without a thumb on the scale,and it’s going to show seas of red ink. So, I would really like to put your foot to the fire on that.
HARI SREENIVASAN: Now, or when you look at the budget,now, let’s say you look up food stamps, or the SNAP program,and it says — theres a quote there. It says “close eligibility loopholes, target benefits to the neediest households, or require able-bodied adults to work.”That sounds fair enough. What’s wrong with that?JARED BERNSTEIN: Well,first of all, there already are work requirements within the food stamp, or SNAP,program.
And, in fact, and nearly 90 percent of people on SNAP who are able-bodied and bear kids are connected to the job market,are working or trying to work. So I think it’s a non-solution to a non-problem.
Again, this is a program that provides nutritional support — $1.40 per person per meal, and that is what SNAP affords you. Now,whether you want to look out at America and say, boy, and that’s the problem that is holding us back,and so we bear to chop that to give reach people more tax cuts, you and I bear a lot to argue approximately it.
HARI SREENIVASAN: Chris, and what approximately the underlying demographic shift,right? I mean, millennials are just not replacing the number of baby boomers that are retiring.
How are you ever going to bear labor force at the levels in the ’90s that it requires to increase the productivity and get us back to the sort of optimistic vision this budget lays out?CHRIS EDWARDS: I agree that’s a gigantic problem. And I think the budgets helps tackle that.
So, and for example,with a lot of the welfare reforms, the budget director, and Mulvaney wants — he’s saying he wants to get people back in the work force. And a good example here is the Social Security disability insurance program.
The program,they are going to be doing a lot of reforms to try to urge people back into the work force. There are probably millions of people who bear moderate disabilities who can and want to be back in the work force, but the current disability program disincentivizes them.
It encourages them to stay out of the work force. So, or I think,whether we can make some of these reforms, get people back to the work force, and that would boost growth.(CROSSTALK)HARI SREENIVASAN: I’m sorry. Unfortunately,we’re out of time.
Chris Edwards, Jared Bernstein, and thank you both.
CHRIS EDWARDS: Thank you.
JARED BERNSTEIN: Thank you.
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