The Obama administration on Tuesday unveiled a $3.9 trillion budget that calls for increased spending on roads and education and promises to close the “income inequality” gap between the wealthy and the poor.
Fiscal year 2015 begins on Oct. 1 and the president’s budget proposal includes plans to increase spending for pre-school education and expand tax credits for nearly 13.5 million low-income workers.
The president’s budget also calls for higher income taxes on wealthy Americans.
"Even in the midst of recovery, too many Americans are working more than ever just to get by, let alone get ahead," Obama said in a statement to Congress. "And too many still are not working at all. Our job is to reverse those trends."
Under the 2015 budget proposal, federal funds would be used to build on existing roads and highways and upgrade Veterans Affairs hospitals and national parks. Further, federal funds would be used to promote clean energy research, “creating 45 public-private manufacturing institutes for spurring innovation and training workers whose companies have closed or moved,” the Associated Press reported.
In order to pay for these initiatives, the Obama budget proposes a so-called “Buffett tax,” named for billionaire Warren Buffett. Under this proposal, a minimum tax would be applied to the nation’s top earners. Additional taxes would also be applied to tobacco products, airline passengers and managers at private investment funds.
The budget also puts aside $5.5 billion on an Obamacare program that many Republicans characterized as a “bailout of the insurance industry," The Hill reported.
"The Affordable Care Act creates a temporary pool of money, known as risk corridors, to pay insurers who enroll a higher-than-expected number of sick patients through 2016," the report notes, adding that Obamacare "transfers the money from lower-risk plans to higher-risk plans to keep premium prices stable in the early stages of the law."
"At least some of the risk corridor payments will be funded by the insurers themselves, as the law requires companies with better-than-expected results to contribute to the pool," it adds.
As ambitious as the president's plan sounds, it's unlikely Congress will embrace these and other spending proposal contained in the White House’s latest budget.
"The president's budget is yet another disappointment because it reinforces the status quo," said Rep. Paul Ryan (R-Wis.), who is the chair of the House Budget Committee, "It would demand that families pay more so Washington can spend more."
The president’s budget is an “open declaration that reality doesn’t matter,” Sen. Jeff Sessions (R-Ala.), the ranking Republican member on the Senate Budget Committee, said in a statement.
“The president’s plan rejects the very idea of limits. It is the manifesto for a big government, tax-and-spend ideology,” he added. “It will further grow the government, shrink the middle class, and shield the political elite from accountability as they raid the nation’s wealth.”
The Obama budget proposes in 2015 an additional $56 billion in spending over the budget caps established in December in the budget hammered out by Ryan and Sen. Patty Murray (D-Wash.), head of the Senate Budget Committee. Half of the proposed additional spending would go to defense and the other half would go to domestic programs.
The Obama budget estimates a 2015 deficit of $564 billion and a shortfall this year of $649 billion, the AP reported. If the projections prove accurate, it will mark three straight years that the U.S. annual deficit clocks in at a little under $1 trillion.
But Republican leadership is far from being sold on the plan.
“This budget betrays both our responsibility to Americans today—struggling to get by in this slow growth, high debt economy—and to our children, who will inherit perhaps the greatest debt any nation has ever accrued," Sessions said.
Here’s the full 2015 budget proposal:
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