Obama Budget Will Undo Sequestration Cuts For Some -- But Not All

President Barack Obama speaks at a distribution center for Safeway stores in Upper Marlboro, Md., Tuesday, Feb. 18, 2014. The
President Barack Obama speaks at a distribution center for Safeway stores in Upper Marlboro, Md., Tuesday, Feb. 18, 2014. The president said having a more fuel-efficient truck fleet will boost the economy and help combat climate change. (AP Photo/Charles Dharapak)

WASHINGTON -- The White House budget to be released in early March will aim to repair some of the damage caused by the sequestration cuts enacted one year ago.

But rather than fully restore funding for affected government agencies, the budget will leave some agencies still facing cuts, while it funds other priorities.

In all, the president's budget will propose $56 billion in new spending for next year, split evenly between defense and non-defense accounts. If passed, it would set spending at pre-sequestration levels. But it won't add to the deficit since the president would propose offsetting the $56 billion with a combination of tax loophole closures and mandatory spending reforms. In a briefing with reporters on Thursday, top administration officials declined to elaborate on the closures and reforms. They did, however, say that the budget would include provisions to sustain the new, elevated spending level past 2015, while reducing the deficits during those years.

The reason the additional spending is needed, the officials explained, is that the budget deal agreed to by Republicans and Democrats at the end of 2013 only partially restored sequestration spending cuts. That deal, crafted by Sen. Patty Murray (D-Wash.) and Rep. Paul Ryan (R-Wis.), provided $45 billion in sequestration relief this year and $63 billion over the next two years.

It was a nice chunk of relief. But it only represented about one-third of the forthcoming sequestration cuts set to take hold during the next two years, meaning that many groups would still face reduced funding. The National Institutes of Health, for example, is looking at a budget that is $714 million short of its pre-sequestration level.

The administration's budget could require all the cuts to be restored in the years ahead. But the president won't be doing that, top advisers said. Instead, his budget will emphasize a different set of priorities, funding some affected by sequestration and keeping funding from others.

On the domestic front, advisers said, the president's budget will call for new manufacturing institutes, job training programs, universal pre-K and expanded Head Start education, as well as a Race to the Top initiative to encourage energy efficiency.

The president's budget is unlikely to pass, making debate over its contents largely overstated. But the decision to reshuffle the sequestration deck could set off a turf war among interest groups affected by the cuts. To date, those groups have largely been unified in pushing for a full funding replacement. With the president signaling that he supports some and not others, that collective front could be tested.



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