President Obama’s Key Budget Points

2 November 2012

blog

By Sabrina Peterson 

On February 13, 2012, the Office of Management and Budget released President Obama’s 2013 fiscal budget. The President’s budget includes spending caps introduced in the Budget Control Act of 2011 and is intended to replace the automatic sequestration spending cuts, which were triggered at the end of 2011 when the Super Committee failed to draft and vote on a bipartisan budget. Even though the President’s 2013 fiscal budget did not receive a single favorable vote in the House or the Senate, it is nevertheless important to review the policies and key priorities outlined within. As the budget debate continues and the fiscal cliff looms, President Obama consistently reiterates key budget priorities included in his 2013 fiscal budget. Therefore, it is important to understand what the President’s 2013 key budget points are.

President Obama’s 2013 fiscal budget will:

  • Make $4 trillion in overall cuts to balance the budget
  • Cut $517 billion in mandatory spending and raise $1.5 trillion in tax reforms over the next 10 years
  • Reduce discretionary spending through spending caps introduced by the Budget Control Act of 2011 as well as the drawdown in overseas contingency operations (otherwise known as   the War on Terror)
  • Cut defense spending by $487 billion
  • Cap the budget for Overseas Contingency Operations spending to $450 billion from 2013-21
  • Use $476 billion saved from cuts to defense spending to fund a surface transportation reauthorization bill
  • Spend $50 billion immediately on road, rail, and runway infrastructure projects to create jobs
  • Extend Unemployment Insurance benefits
  • $7.5 billion to fund WIC (Women, Infants, and Children Supplemental Nutrition Program)
  • No cuts to SNAP (Supplemental Nutrition Assistance Program)
  • Oppose making the Bush era tax cuts permanent for families making over $250,000 a year
  • Create and enforce a Financial Crisis Responsibility Fee for financial firms with over $50 billion in assets
  • Simplify the tax code and lower tax rates by lowering individual and corporate tax rates as well as consolidating the current number of tax brackets
  • For taxpayers making over $1 million per year, replace Alternative Minimum Tax rate with 30% income tax rate
  • Reduce the value of itemized deductions and other tax preferences to 28% for families with incomes over $250,000 per year
  • For managers in investment services partnerships, eliminate 15% tax rate for tax carried interests as ordinary income
  • Eliminate special tax breaks for oil and gas companies
  • Oppose turning Medicare into a voucher program
  • Oppose turning Medicaid into a block grant program
  • Establish Affordable Insurance Exchanges for the Affordable Care Act
  • Eliminate direct payments to farmers
  • Reduce crop insurance subsidies
  • Cut catastrophic coverage policy reimbursements to crop insurance companies by $225 million
  • Cut conservation funding and use existing funds for high-priority projects only
  • Fund projects to restore ecosystems such as the California Bay-Delta, Everglades, the Great Lakes, Chesapeake Bay, and the Gulf Coast
  • Establish Great Outdoors Initiative to conserve landscapes and recreation in national parks, refuges, and other public lands
  • Reduce energy costs for the Department of Defense which consumes 75% of the energy used by the Federal Government
  • Double the share of electricity from clean energy sources by 2035
  • Make public lands available for private investments for the development of clean energy
  • Fund development of the nation’s off-shore oil and gas resources
  • Re-authorize Clean Energy Manufacturing Tax Credits
  • Increase employee contributions to retirement plans by 1.2% over the next 3 years beginning in 2013
  • Eliminate Federal Employee Retirement System Annuity Supplement for new government employees
  • Reform federal worker and military retirement programs to align with private sector plans
  • Establish a system of automatic workplace pensions and double small employer pension plan start-up credit
  • Expand Race to the Top model to higher education
  • Suspend student loan interest rate increase from 3.4% to 6.8%
  • Make permanent the American Opportunity Tax Credit

 

For questions on President Obama’s 2013 fiscal budget, contact Sabrina Peterson at speterson@cafoodjustice.org

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