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President Barack Obama submitted his budget for the 2011 fiscal year to Congress last Monday. Included in that budget is a three-year non-security discretionary spending freeze, the controversial cancellation of a NASA program and an extension of economic stimulus measures enacted in the 2009 Recovery Act.
“We’re trying to accomplish a soft landing,” Peter Orszag, director of the Office of Management and Budget, said in a recent speech. If implemented, Obama’s new budget would include $100 million in stimulus spending intended to boost the U.S. economy.
For Maine, the budget includes $21.6 million for child-care assistance, $120 million designated for housing assistance and $272.6 million for roads, airports and water systems. There is also $121.2 million of national funding for Pell Grants to help college students pay their tuition.
The U.S. federal budget is a funding request submitted by the president to Congress, which ultimately approves of all government expenditures. If approved, the budget would direct funding for the fiscal year 2011, which begins Oct. 1.
The proposed 2011 budget will add $1.27 trillion to the deficit. At the end of last month, the Senate rejected legislation intended to establish a Congressional Commission for the purpose of reducing the national deficit.
Many features of the new budget are extensions of the Recovery Act passed by Congress one year ago. The Recovery Act included tax cuts and domestic spending in areas such as health care and national infrastructure. Orszag noted that the rate of economic growth increased by approximately 10 percent from the end of 2008 to the end of 2009. However, as opposed to referring to these budget changes as a second attempt at stimulus, the administration has stated the focus for 2011 is on decreasing the unemployment rate.
Some of the budget changes include a $90 billion tax on banks to be implemented over the next decade. Also, tax cuts implemented in 2001 and 2003 for individuals earning over $200,000 and families earning over $250,000 would expire.
The president has proposed a cut for NASA’s Constellation program. Some of the program’s goals include sending human beings to the moon, and possibly Mars, and developing new types of spacecraft to replace the Space Shuttle. Obama favors using contracts with private companies to reach these goals.
A key feature of the budget is a halt to spending meant to save the government $250 million by freezing some domestic programs for three years and then holding them to the rate of inflation until 2020. The spending freeze would be discretionary, and the Office of Management and Budget has identified more than 120 government programs to be reduced or terminated. The defense budget would be $549 billion. After inflation, this represents a 1.8 percent increase.
One of Obama’s goals for this budget is to reduce the national unemployment rate, which fell from 10 to 9.7 percent last month.
One proposal aimed at job creation is a $4 billion fund for the creation of a National Infrastructure Bank, an idea proposed in Congress. Obama is encouraging Congress to continue pushing health care reform as a step toward economic recovery.
Readers can find information for reaching their congressional representatives at contactingthecongress.org, and the complete proposed U.S. budget for fiscal year 2011 can be found at whitehouse.gov/omb.
Bangor Daily News