Copies of the President's budget are displayed at a photo op in the Senate Budget Committee room on May 23. | John Shinkle/POLITICO Analysis Trump budget: Long on wishful thinking, short on shared sacrifice

President Donald Trump’s new balanced budget plan is a little like his famous hungering for a Purple Heart.

As a candidate last summer, Trump allowed that he had always coveted the military decoration for those wounded in combat. But when given his chance to earn one as a young man, Trump avoided the draft in the Vietnam War.


The pattern repeats itself now in the president’s budget, where he again takes the path of wishful thinking without showing much commitment to shared sacrifice.

For example, fully $2 trillion of Trump’s deficit reduction plan rests in large part on what many contend are overly optimistic economic assumptions. At the same time, the president doesn’t hesitate to demand very large savings from programs for the poor and disabled — all ahead of the policy debate over how to actually reform these benefits.

To understand the stakes, one good starting point is to compare the White House documents Tuesday with those prepared by Speaker Paul Ryan (R-Wis.) when he first took over the House Budget Committee in 2011.

Like Trump, Ryan’s “Path to Prosperity” back then defined success as bringing government spending and revenues into rough balance at about 19 percent of the nation’s gross domestic product or GDP.

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Ryan, like Trump, endorsed tax cuts and defense spending increases while demanding domestic savings. But as scored by the Congressional Budget Office, it took Ryan almost 20 years to get to his goal. And that was only after he put himself at risk by ratcheting down the growth in Medicare, the healthcare program for the elderly.

Trump avoids such politically tough decisions yet still promises to achieve a balanced budget in 10 years. He does this by projecting robust economic growth to make his task easier. And to a remarkable degree, Trump takes Republicans down a path that shifts the economic burden ever more onto low income families.

Social Security retirement benefits and Medicare — important to elderly of all incomes — are largely spared. By 2027 these two entitlements alone would represent more than half of government spending under the president’s plan, according to White House tables.

Instead, the lion’s share of Trump’s proposed entitlement savings would come from programs for the disadvantaged: Medicaid, food stamps, welfare and disability benefits. At the same time, the relative balance that exists today between defense and non-defense appropriations would be radically altered, making it harder for Congress to fill holes in the safety net.

Indeed, non-defense discretionary outlays would drop to $429 billion in fiscal 2027, according to White House tables. That is 42 percent less than what’s projected now for 2027 under the spending caps in current law. As a share of the nation’s economy, it translates to just 1.4 percent of GDP for 2027 — less than half the 3.3 percent level just last year in fiscal 2016.

Put another way, Trump’s vision of a government in balance would mean two-thirds of all outlays in 2027 would be consumed by just four areas: defense, interest payments, Medicare and Social Security.

For sure, the White House rounds up the usual suspects — like farmers — and threatens some $38 billion in cuts to agriculture subsidies and related programs. But with a new farm bill on the horizon, Trump also goes well beyond Ryan’s fiscal 2012 budget and demands more than $190 billion in 10-year savings from food stamps.

That includes a new plan to ask states to pick up as much as 25 percent of the annual costs in the future. On a long-term basis, that could translate into an estimated $11 billion burden for governors each year. And for food stamp advocates, it represents a retreat from what has been an historic commitment by Washington to address hunger issues from the federal level.

In the case of Medicaid, Trump’s $610 billion in new savings come on the heels of a bitter healthcare debate in which future funding for the same program would be severely cut by the House. All this after Republicans — with Trump’s blessing — plan to roll back capital gains and payroll taxes on the wealthy, surrendering billions of dollars in 10-year revenues that could have been used to narrow the deficit or protect elements of the safety net.

Former Sen. Judd Gregg (R-N.H.), who once chaired the Senate Budget Committee and remains a voice on deficit politics, said he had no problem with giving up those revenues. “Those were tax increases that shouldn’t have occurred,” Gregg said. But going forward, he said the White House erred by not addressing Medicare and relying too much on “the magic wand of dynamic scoring when they all know that’s a dead end street.”

“It’s clear you’re not going to get deficits under control until you address the entitlements but the biggest one is Medicare,” Gregg said. “If they think this is a realistic budget they are more out of touch than they appear to be, which is pretty far out of touch.”

“This is a statement budget,” Gregg added. “I give them credit for opening the debate on Medicaid. It needs to be discussed. And disability needs to be discussed and the earned income tax credit needs to be discussed. But unfortunately they have postured it more on a numbers basis than a policy basis which is always a mistake.

“It’s legitimate to address those programs but if you don’t do the policy first to make it clear you want to make the programs better, not just arbitrarily to cut them, you lose the debate coming out of the starting gate,” Gregg said.