The White House rolled out its new $3.8 trillion budget Monday, promising major investments to spur a manufacturing revival in the U.S. while walking a fine line between the August debt accords and President Barack Obama’s fear that too much austerity now will spell trouble for the economy—and his own reelection chances in November.
From Justice to Defense and Homeland Security, as many as six cabinet level departments or agencies will see their budget shrink in compliance with the new appropriations caps. But Obama would also go outside the box by creating new mandatory spending initiatives costing tens of billions of dollars and for the first time, openly tap war savings to fund his domestic agenda.
“America was built on the idea that anyone who is willing to work hard and play by the rules, can make if they try—no matter where they started out,” Obama says, in his opening budget message to Congress. “But for many Americans (today), the basic bargain at the heart of the American Dream has eroded.”
Mississippi Gov. Phil Bryant wants to cut state spending by $26 million to $5.49 billion in 2013, also insisting on building $100 million in state reserves. The Republican summarizes his first budget as a “lot of cuts,” saying he won’t raise taxes.
Many agencies would get 5.5 percent less in the year beginning July 1. Bryant would cut K-12 school funding by $73 million, demanding districts spend reserves. Community colleges and universities would mostly get 5.5 percent less.
Some law enforcement agencies would be spared.