US President Donald Trump is aiming to balance the federal budget in a decade with substantial cuts to safety-net programmes, combined with a tax overhaul to speed up the economy and achieve an ambitious growth rate of three per cent, the White House has said.
Requesting a 10 per cent or USD 54 billion increase in defence budget, the maiden annual budget of the Trump administration which would be sent to the Congress later cuts into government safety-net programmes like students loans, disability benefit and food stumps.
The title of the budget is "A New Foundation for American Greatness," said Mick Mulvaney, Director of the Office of Management of Budget in the White House, which lead the team to prepare the budget.
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It would be a tax payers first budget, he told reporters at a White House news conference.
Mulvaney said it balances the federal budget in 10 years.
"In fact, it begins to reduce the deficit as a percentage of the overall economy in year one," he said.
"Trumponomics is and what this budget is a part of is an effort to get to sustained 3 per cent economic growth in this country again," he added.
The budget proposal for fiscal 2018 is scheduled to be delivered to lawmakers later today.
"The ugly truth is this: You can never balance the budget at 1.9 per cent growth. Just not going to happen. So those out there who say you're never going to grow beyond 1.9 per cent are condemning us to a future filled with nothing but debts and deficits," he said making a point why the Trump administration has set a target of three per cent growth rate.
According to the White House, the policies of previous administrations have resulted in a broken and stagnant economy, more than USD 20 trillion of debt, and a government that dramatically underserves the needs of its citizens.
The 2018 Budget, The New Foundation for American Greatness, will balance the Nation's spending and reduces the national debt as a per cent of GDP immediately.
By 2027, when the budget reaches balance, publicly held debt will be reduced to less than 60 per cent of GDP, the lowest level since 2010, when the economic policies of the last administration took effect, it said.
"It makes substantial changes to the priorities of the previous administration to ensure that our citizens are safe and prosperous in the future. It ensures that the Federal Government spends precious taxpayer dollars only on worthwhile policies, and in the most efficient, effective manner," it said.
And, the budget supports broader efforts to streamline government, which will drive an economic boom and raise incomes and expand job opportunities for all Americans, the White House said.
"To avoid loading our children and grandchildren with unsustainable levels of debt, the budget includes USD 3.6 trillion in spending reductions - the most proposed by any President in a budget - to reach balance within 10 years.
This plan will reduce publicly held debt to 60 per cent of GDP, the lowest level since 2010, when the economic policies of the last administration took effect," the White House said.
The budget among other things includes USD 639 billion for the Department of Defence (DOD), reversing the defence sequester and filling critical gaps in its warfighting readiness.
"These resources provide for the military forces needed to conduct ongoing operations, deter potential adversaries, and protect the security of the United States. At the same time, the budget lays the groundwork for an ambitious defence reform agenda to reduce the costs of military programmes wherever feasible without reducing effectiveness or efficiency," the White House said.
If the US continues to underinvest in infrastructure, it will continue to fall behind other nations and its economic performance will suffer, the White House said.
"The budget provides for the President's target of USD 1 trillion in infrastructure investments, that will be met with a combination of new Federal funding, incentivised non-Federal funding, and expedited projects that would not have happened but for the Administration's involvement (for example, the Keystone XL Pipeline)," the White House said.
For the first time, the budget proposes a fully paid-for proposal to provide six weeks of paid family leave to new mothers and fathers, including adoptive parents, it said.
Building on the Unemployment Insurance System as a base, the budget proposes to allow States to establish paid parental leave programmes that are most appropriate for their workforce and economy, it added.
There is no cut on Medicare and Social Security, Mulvaney said.
Noting that tax reform, for both individuals and businesses, will grow the economy and make America a more attractive business environment, the White House said the President's tax plan is not just a tax cut.
"It is tax reform to make our tax system simpler and fairer. While cutting tax rates, it also eliminates loopholes and deductions," it said.
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