President Trump Seeks to Reduce Government Spending and Streamline Federal Agencies with Budget Proposal and New Executive Order

This week, President Donald Trump released the America First Budget, his budget proposal for FY 2018. Under this budget proposal, every agency would receive funding cuts except for the Departments of Defense, Homeland Security, and Veterans Affairs. In his letter to Congress, he wrote, “The core of my first Budget Blueprint is the rebuilding of our Nation’s military…” and the budget includes “a $54 billion increase in defense spending in 2018 that is offset by targeted reductions elsewhere.”

The Department of Health and Human Services (HHS) faces a $15 billion cut under the proposal, primarily focused on the National Institutes of Health and other biomedical research. However, the proposal only addresses discretionary spending and does not include cuts to Medicare and Social Security.

In addition to proposed budget cuts, President Trump has issued executive orders to the heads of each federal agency, including HHS, to submit a comprehensive plan that addresses the reorganization of their agencies to improve the efficiency, effectiveness, and accountability. Costs of continuing to operate and/or the costs of shutting down or merging agencies should be considered, according to President Trump.

President Trump’s budget proposal does not establish any legally enforceable regulations. Congress must develop its own budget and appropriations plan. The current continuing resolution (CR) funding the government for FY 2017 expires April 28, 2017. Congress must develop a spending plan to see out the rest of 2017, in addition to beginning its budget process for 2018. We will keep you updated.