President Barack Obama officially announced his proposed budget for fiscal year 2015 at an elementary school in Washington, D.C. The location symbolized his focus on domestic priorities, including education.
“These kids may not be the most excited people in town on budget day, but my budget is designed with their generation and future generations in mind,” said Obama.
The president wants to expand preschool education and job training. He wants to spend money on bridges, roads, railroads, parks, alternative energy, and veterans hospitals, also as means to create jobs.
He wants to expand the earned income tax credit to people who do not have children at home. Now it gives people who have dependent children and work without earning much money a bigger refund when they file taxes. “The most effective and historically bipartisan ways to reduce poverty and help hardworking families pull themselves up is the earned income tax credit.
Right now, it helps about half of all parents in America at some point in their lives,” said Obama.
If Congress accepts his proposal, people who earn low wages but do not have any dependents can also file for an earned income tax credit.
$1 Trillion More Tax Revenue Obama intends to pay for this with more than $1 trillion in higher taxes over the next decade, mostly for the wealthiest Americans. House Speaker John Boehner condemned the idea. “After years of fiscal and economic mismanagement, the president has offered perhaps his most irresponsible budget yet. American families looking for jobs and opportunity will find only more government in this plan. Spending too much, borrowing too much, and taxing too much, it would hurt our economy and cost jobs,” Boehner stated.
The tax increases would raise $651 billion by limiting tax deductions for the nation’s highest earners. A “Buffett tax”—named after billionaire Warren Buffett—will levy a minimum amount on the highest earners. Taxes would also be raised on large estates, financial institutions, tobacco products, airline passengers, and managers of private investment funds.
“The president’s budget is yet another disappointment because it reinforces the status quo,” said House Budget Committee Chairman Paul Ryan, (R-Wis.). “It would demand that families pay more so Washington can spend more.”
The Republican recipe for accelerating economic growth includes cutting taxes or overhauling the entire tax code, and they think higher spending is wasteful.
But not only members of the GOP have a different recipe for boosting the economy than the president. Some legislators from his party also have different spending priorities.
Less Help for Salmon For example, Sen. Patty Murray (D-Wash.) worked with Ryan to create a compromise budget to avoid another government shutdown like the one in 2013 and was disappointed by cuts to a salmon recovery program in her state.
She stated: “Overall, the President’s budget represents a strong commitment to our economy and the environment, but unfortunately, the proposed cuts to the Pacific Coastal Salmon Recovery Fund could seriously harm a vital resource in our state.” Obama’s budget offers the state of Washington $50 million for salmon recovery, a cut of $15 million.
Georgia’s Republican senators, Johnny Isakson and Saxby Chambliss were shocked the proposal contained no funds for deepening the Port of Savannah, which the administration had said it supported.
They issued a joint statement, which said in part, “We are deeply disappointed and frustrated to see the promises to help advance the Savannah Harbor Expansion Project made by President Obama and Vice President Biden were not fulfilled in today’s budget release.”
Unlikely to Pass Congress Opposition in principle from conservatives, opposition from those whose taxes would rise, and bread and butter opposition from legislators whose states may lose vital funds means that the budget is unlikely to pass as written.
The political side of it is that Obama has set a traditional Democratic agenda. It is a useful campaign tool for Democratic legislators during this midterm election year.
The Associated Press contributed to this report.