Samuelson: Obama Budget Proposal “Guts” Government

February 14, 2012; Source: Washington Post | Without attaching too much importance to a budget proposal that won’t get more than a glimmer of attention from the U.S. Senate, we can ask what values and priorities are embedded in President Obama’s proposals for the 2013 fiscal year. Economist and Washington Post columnist Robert J. Samuelson notes that Obama’s budget predicts an increase in Social Security spending over the next decade of 27 percent and an increase in Medicare and Medicaid spending of 41 percent while other domestic spending decreases by one-fifth. He scathingly concludes, “An avowedly liberal administration is gutting government because it lacks the political will to confront programs for the elderly.”

That cut in domestic spending—totaling almost 20 percent—assumes a concurrent cut in defense spending of 23 percent. Our guess is that if the advocates of military expenditures gear up for their usual effective lobbying, the Pentagon won’t lose anywhere near that much, meaning that the difference would be made up in even deeper domestic spending cuts.

Specific to FY2013, the president’s budget proposals cut discretionary domestic spending down from $450 billion to $410 billion, a far cry from the $477 billion for FY2013 that the White House predicted just two years ago during the deficit control debates. According to the Washington Post’s analysis, the Department of Health and Human Services (HHS) would be cut by 8.4 percent and the Department of Housing and Urban Development (HUD) would be cut by 7.5 percent. Through some fiscal sleight of hand, the White House says that many of those cuts aren’t quite so bad because of this gimmick and that set-aside, which is typical of complex, multiple telephone book-sized budget documents.

Nonetheless, there are some programs that won’t be saved by pulling a rabbit out of a magician’s hat. The Community Services Block Grant (CSBG), which focuses on reducing poverty, is back on the president’s proposed chopping block for a 50 percent cut; the remainder would be geared to “target funding for the highest-performers with demonstrable impacts.” NPQ wrote about this proposal when the president first proposed it in his 2011 State of the Union address. At the time, it caught CSBG’s primary constituency of community action agencies by surprise (see here and here).

Housing for disabled people and for rental assistance programs (except for veterans) also gets cut, though the president’s “Choice Neighborhoods” program, which replaced the HOPE VI public housing redevelopment projects, is slated for a boost. Also projected for more money is funding for housing counseling (finally!) though Congress keeps knocking that number down in its annual budget turmoil.

The U.S. Department of Education gets an overall increase of 3.4 percent with specific funding increases aimed at the Promise Neighborhoods program and the Race to the Top program, both of which have strong charter school priorities and, in the case of the Race, push public education toward a more market-based orientation.

So what? The budget is dead, no? Probably true, but if this is the Democrats’ best guess of a vision for government, it bodes poorly for the bread-and-butter safety net nonprofit organizations that depend on HHS and HUD programs—and on the Community Services Block Grant—to help poor Americans avoid sinking deeper into poverty. –Rick Cohen