President Barack Obama is expected to propose a freeze on all non-security federal discretionary spending for three years, potentially saving $250 billion, in Wednesday’s State of the Union address, according to two senior administration officials who spoke anonymously to the press Monday.
The freeze would not include budget cuts for the Departments of Defense, Homeland Security and Veterans Affairs, but would affect the budgets of many domestic programs, possibly including health care and education, both have which have received major attention since Obama took office.
After the initial announcement in Wednesday’s address, which is scheduled to be televised at 9 p.m., the details of the proposal will be revealed on Feb. 1 in the fiscal year 2010 budget. ‘We’ve got to make some tough decisions,’ one of the officials said. ‘Everybody is not going to get what they want.’ The proposal could help Obama’s credibility with conservatives and centrists, but could also strain his relationship with more liberal Democrats in Congress. Some say the proposal would not do enough to control the growing national debt. The proposed $250 billion in savings represents three percent of the debt that the government is expected to add over the next three years, according to The New York Times. The sector of the budget covered by the freeze ‘- $447 billion in domestic programs ‘- would amount to only about one-sixth of the entire federal budget, The Times reported. Though some conservatives expressed concern that the plan would not do enough to curb the deficit, the officials said cutting small programs, many of which fall under the discretionary spending that will be frozen, could have a greater symbolic effect for general ‘fiscal discipline’ than cutting costly entitlement programs, such as Medicare and Social Security.
Specific programs to be cut will be outlined in the budget next week. It is currently unclear how this plan will affect the fate of the health care bill, which has been a major White House priority. that is now being debated in Congress. The bill’s chances of passing suffered a potential blow in the Jan. 19 election of Republican Scott Brown to one of Massachusetts’ formerly Democratic Senate seats. Brown may represent the extra vote needed in the Senate for a Republican to continue filibustering the reform.
In addition to spending, Obama is also expected to address jobs in his speech, White House advisor David Axelrod said Sunday on CNN’s ‘State of the Union.’ Axelrod acknowledged the public could only take ‘cold comfort’ in the administration’s claim that the stimulus package saved about two million jobs and said the president will discuss job creation in his speech.
Stay tuned to The Daily Free Press for State of the Union coverage and analysis later this week. ‘