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President Releases FY 2014 Budget
April 12, 2013—President Obama April 10 released his long-delayed FY 2014 budget. The budget proposes nearly $1.8 trillion in additional deficit reduction over the next 10 years, bringing the total deficit reduction to $4.3 trillion, and replacing the need for sequestration as mandated by the Budget Control Act of 2011 [BCA, P.L. 112-25].
By law, the president is supposed to send the budget to Congress no later than the first Monday in February. However, the administration delayed the release of the FY 2104 budget because of the uncertainty surrounding the final FY 2013 spending bills and the impact of sequestration. This uncertainty is reflected in the administration’s budget documents, which compare the proposed FY 2014 levels to FY 2012 levels.
The budget proposes:
- About $580 billion in additional revenue from tax reform that closes tax loopholes and reduces tax benefits for the wealthy;
- About $400 billion in health savings;
- About $200 billion in savings from other mandatory programs, such as reductions to farm subsidies and reforms to federal retirement contributions; and
- About $200 billion in additional discretionary (appropriated) savings, with near equal amounts from defense and non-defense programs.
For discretionary spending in FY 2014, the president’s budget uses the BCA-mandated cap of $1.058 trillion and does not assume sequestration will occur. This is approximately $92 billion higher than the spending caps in the House and Senate budget resolutions approved last month, which do assume that sequestration will occur.
The Office of Management and Budget April 14 issued an FY 2014 “sequestration preview” report to Congress that confirms that under current law, if sequestration remains in effect for FY 2014 there will be a $91 billion reduction in the discretionary caps and a sequestration of $18 billion in nonexempt mandatory spending.
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