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Federal budgets

Obama's last budget proposal would spend $4.1 trillion

Gregory Korte
USA TODAY
Copies of President Obama's Fiscal Year 2017 budget are distributed on Capitol Hill Tuesday.

WASHINGTON — President Obama's $4.1 trillion budget proposal to Congress combines ambitious election-year proposals unlikely to be passed by a Republican Congress with more achievable proposals for cancer research, drug treatment and cybersecurity.

"The budget that we’re releasing today reflects my priorities and the priorities that I believe will help advance security and prosperity in America for many years to come," Obama told reporters at the White House. "It adheres to last year’s bipartisan budget agreement. It drives down the deficit. It includes smart savings on health care, immigration, tax reform."

But that vision will come at a cost. Budget deficits will grow to 2.8% of the economy, with a cumulative effect of increasing the national debt from $19 trillion to $27.4 trillion over the next decade, according to the Office of Management and Budget.

And although the Obama administration expects the debt to remain relatively stable as a share of the economy, that projection is based on a set of assumptions: The economy will continue to grow by about 2.5% over the next decade. Congress will enact a $10-a-barrel tax on fuel oil, raising $319 billion over 10 years. Congress will pass immigration reform, resulting in another $170 billion in new revenue over the next decade. And off-budget war spending will decrease by $636 billion through 2026.

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“President Obama will leave office having never proposed a budget that balances — ever," House Speaker Paul Ryan, R-Wis., said in a statement released minutes after the budget became public. "This isn’t even a budget so much as it is a progressive manual for growing the federal government at the expense of hardworking Americans."

More than 20 new policy proposals in the budget were already announced since Obama's State of the Union address last month. The budget will seek a largely budget-neutral upgrade of the unemployment insurance program, $4 billion for computer science education, $1 billion for cancer research, $1.1 billion for prescription pain medication and heroin addiction treatment, a $10-a-barrel oil tax to pay for transportation improvements, a doubling of clean energy research funding, and $19 billion to shore up the government's cyber defenses.

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The budget must still be approved by a Republican Congress in a year in which the GOP hopes to take back the White House so it can write its own budgets beginning with the 2018 fiscal year.

But in a break from tradition, both the House and Senate budget committees have declined to invite Obama's budget director, Shaun Donovan, to testify about the president's proposals. White House Press Secretary Josh Earnest said it's unfortunate that congressional leaders lost the spirit of compromise that allowed them to finally pass a 2016 budget late last year.

"Part of me suspects that that might be because Republicans don’t relish the opportunity to have a discussion about budget priorities like this administration does," Earnest said Monday. "That may be an indication that they want to avoid some tough questions about their budget priorities, and they’re taking a page from Donald Trump’s playbook and ducking the tough questions."

Republicans have been most vocal in opposing Obama's energy tax and climate spending. But on some areas — an expanded tax credit for childless workers, cancer research and drug treatment — the White House is still optimistic about the prospects for a deal.

"It's tempting to adopt the conventional wisdom that a president's final budget is not relevant. I think the conventional wisdom is wrong," said Budget Director Shaun Donovan.

"The budget offers a range of proposals where there's bipartisan support for taking action," he said. "In other cases, we may not get bipartisan support, but the president isn't going to shy away from proposing solutions that are both good for our economy and address major challenges that we face. Those proposals may not be enacted this year but they lay the groundwork for reaching solutions in the long run."

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