Obama Budget: Draft May Not Resemble Final Result

The 2011 Obama budget is out. It proposes far-reaching government spending cuts, lower oil and gas subsidies, and higher fees to reduce the deficit. Bloomberg BusinessWeek has the details:

The poor would receive less help paying their heating bills, and graduate students would pay more for their student loans. The budget also cuts $1 billion for airport grants and $950 million in water-treatment plants and other infrastructure.

Obama is calling for the elimination of a dozen tax breaks for oil, gas and coal companies to raise $46 billion over 10 years. These funds would be diverted to help pay for putting 1 million electric vehicles on the road by 2015, doubling the share of electricity from clean energy by 2035 and increasing the efficiency of energy use in buildings by 20 percent.

The administration is calling for $85 billion in new or increased fees over the next 10 years that would affect a number of industries. It wants to raise $28 billion by more than doubling airline security passenger fees. Another $16 billion would come by raising fees companies pay to the Pension Benefit Guaranty Corporation to insure their pensions. Oil and gas companies would see their inspection fees more than sextuple, to $65 million, to cover the costs of increased oversight in the wake of the BP Deepwater Horizon oil spill. The government would charge new or higher fees for patents, generic-drug reviews and manufacturers seeking to label products with its “Energy Star,” among other changes.

The budget proposal also calls for spending on high-speed rail systems, better emergency services and Internet infrastructure, more money for the Pentagon, and less money for the war in Iraq, according to Bloomberg BusinessWeek.

But it’s too early to go hog wild over contentious pieces of the proposal. It’s basically a first draft of a budget, aimed at cultivating bipartisan support. The Washington Post explains:

Even as the administration said it wants to reduce the deficit by more than $1 trillion over the next 10 years, it declined to propose major changes to Social Security, Medicare or Medicaid, which combined account for more than 40 percent of federal spending. And the proposed increases in funding for education, science and research, while significant, don’t match the ambition of the policies Obama pursued in his first two years in office.

…at least for now, Obama has not laid out a major legislative proposal that would occupy weeks or months of time on Capitol Hill, and it’s not clear whether he will. His proposals to reduce spending are in part to preempt congressional Republicans, who are calling for much larger cuts.

Salon’s Andrew Leonard goes so far as to call the Obama budget irrelevant. Up next: more partisan infighting.

  • While the President is feeding us his line of garbage as to cutting spending, it came to my attention yesterday that the FED is considering a QE3 package as the 1.2 trillion dollars of worthless money they’ve already printed hasn’t done what they though it would. All of the cuts in the world are not going to offset the hyper inflation and the costs that come with printing worthless money. M1 has grown 15.2% in less than 3 months and all of that is unbacked paper!

  • Tony

    While the previous president sat in office and led us on a 3 trillion dollar war based on lies and bs. While the previous president sat in office and passed a medicare entitlement bill that cost the gov’t milions. While the previous president sat in office for 8 years and (never) refused a single spending bill. And we wonder why we are here today? Weither it’s Republica, Conservative, Tea Party … if it looks like a pig and smells like a pig then it is a pig :) Don’t be fooled by inuendo and redric. At least while the current president is in office (he) is tring to do something :)

  • Tony

    unuff said :)