Sunday, May 9, 2021
HomeWorldObama’s $4 trillion budget: Higher US spending, tax hike for rich

Obama’s $4 trillion budget: Higher US spending, tax hike for rich

President Barack Obama’s 2016 budget unveiled on Monday sets priorities for the middle class and proposes major infrastructure improvements, to be paid for largely through increased contributions by the wealthy and corporate America.

Republicans, who now control both chambers of Congress, are likely to balk at the wish list and criticize it as a return to liberal tax and spend policies.

The following is a breakdown of the main points of the budget proposal: Obama’s budget for fiscal year 2016, which begins October 1, comes in at $3.999 trillion — about 21.3 per cent of gross domestic product, up from the current year’s 20.9 per cent.

Some 70 per cent of the spending is obligatory, as it covers public safety net programs such as Social Security and health coverage for the elderly (Medicare), as well as debt servicing.

The “discretionary spending” is $1.168 trillion, divided about evenly between defense and non-defense programs. Pledging new help for America’s struggling middle class, Obama wants to expand affordable child care, in part by tripling the child care tax credit, making it eligible for families making up to $120,000 annually. The change would help some 5.1 million families.

He also proposes a “Preschool for All” initiative.

Among a series of educational pitches, he wants to make tuition at two-year community colleges free for many students. A total of $585 billion is set aside for military spending, while $53.4 billion is meant for State Department programs and other international operations.

Obama’s Pentagon budget marks an increase of more than four per cent over 2015, but with wars declared over in Iraq and Afghanistan, the spending is 24 per cent lower than in 2010, when adjusted for inflation.

The year-on-year increase is aimed in part at ending the restrictions on defense spending that were imposed by funding caps beginning in 2013.

Operation Inherent Resolve, the mission targeting the extremist Islamic State group in Iraq and Syria, is funded at $5.3 billion.

Most Popular

- Advertisment -