From the NYT: Obama’s Last Budget, and Last Budget Battle With Congress
President Obama on Tuesday sent his final annual budget proposal to a hostile Republican-led Congress, rejecting the lame-duck label to declare that his plan “is about looking forward,” with new initiatives that include $19 billion for a broad cybersecurity plan.
The budget for the 2017 fiscal year, which starts Oct. 1, would top $4 trillion, although just over one-quarter of that is the so-called discretionary spending for domestic and military programs that the president and Congress dicker over each year. The rest is for mandatory spending, chiefly interest on the federal debt and theSocial Security, Medicareand Medicaid benefits that are expanding automatically as the population ages.
The deficit would increase in this fiscal year to $616 billion from $438 billion last year, the budget projects, in part because of tax cuts that Mr. Obama and Congress agreed in December to make permanent. That would make this year’s shortfall equal to 3.3 percent of the economy’s output, or gross domestic product, up from 2.5 percent and exceeding the 3 percent threshold that economists consider sustainable for a growing economy.
Mr. Obama’s proposed 10-year savings — some spending cuts, but primarily almost $3 trillion in higher taxes from wealthy individuals and some businesses, including a $10-a-barrel fee on crude oil — would push deficits down again for a couple years and offset costs of the president’s proposed initiatives.
Then deficits would begin increasing again with the retirement and health costs of aging Americans. The administration says annual deficits would remain below 3 percent of the gross domestic product through the decade to 2026. The accumulated debt held by the public would grow from $14 trillion currently to $21.3 trillion in that time, but measured against a growing economy, the debt would be stable at about 75 percent of gross domestic product.
