Public Policy
President Obama released his budget outline to Congress for fiscal year 2010 on February 26, and issued a detailed proposal on May 7. Titled A New Era of Responsibility: Renewing America’s Promise, the $3.6 trillion budget plan outlines his spending priorities and supports his agenda for reforming health care, education and the environment. The budget blueprint:
- Sets total non-defense discretionary spending at $539.6 billion, which includes funding for nearly every government agency and program not designated for defense or mandatory initiatives.
- Proposes eliminating or reducing funding for 121 programs at a savings of $17 billion, and
- Projects a deficit for the fiscal year 2010 of $1.5 trillion, down slightly from $1.58 trillion in fiscal year 2009.*
The President’s budget is not binding and Congress will now act through its tax and appropriations committees to put some or all of these provisions in effect for the upcoming fiscal year.
Analysis of the President’s Budget
Tax Issues (IS member password required)
The Obama budget calls for maintaining the estate tax at the 2009 levels; increasing taxes on those in the highest bracket, including a measure that would reduce the value of tax deductions for charitable donations, state and local taxes and real estate expenses for families earning more than $250,000; and making permanent several individual tax provisions enacted earlier this year in the American Reinvestment and Recovery Act.
Spending Items (IS member password required)
The Obama budget outline for fiscal year 2010 sets discretionary spending for both defense and non-defense programs at $1.096 trillion. It calls for boosting funding for domestic priorities, winding down spending for the war in Iraq, and creating a “reserve fund” of $635 billion to cover health care expansion, among other provisions.
* Based on revised OMB projections released August 25, 2009.
Last Updated: August 27, 2009
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