President Trump has proposed a 10% increase in the defense budget. I gather this means he will request supplementary spending of $30 billion for FY2017 (this year) and a full $54 billion for FY2017. This will put the defense budget at $603 billion and non-defense discretionary spending at $462 billion for FY2018. Of course, this has to go through congress, as the House of Representatives only can initiate spending bills, and they somehow or the other have to pay for this (which is going to be an issue). No specifics on what the money will be spent on, although they mentioned planes and ships.
Trump-plans-to-cut-funding-for-most-government-agencies
The cuts will be a challenge. According to one article: “Two officials familiar with Trump’s proposal said the planned defense spending increase would be financed partly by cuts to the State Department, Environmental Protection Agency and other non-defense programs.”
The State Department and U.S. AID budgets are around 50 billion. Around $26 billion goes to foreign aide. The top four recipients for aid are Israel (3.0 billion), Egypt (1.3 billion), Afghanistan (1.3 billion) and Pakistan (700 million). I can’t envision we would cut any of these four aid programs, so savings from these budgets may be limited.
The EPA budget is 8 billion. They are talking about a 25% cut there, so $2 billion.
The rest of the money will have to come from other non-defense discretionary programs (vice Social Security, Medicare, paying interest on the debt, etc.) or we will have to increase the deficit. Right now, I suspect it will be the later. The last two major defense build-ups were funded by deficit spending.
