Analysis of the Bush Budget

President Bush released his budget for Federal Fiscal Year 2009 on Monday. According to an analysis by the Center on Budget and Policy Priorities (CBPP), the Administration's proposed budget for Federal Fiscal Year 2009 would cut funding for domestic discretionary programs outside of homeland security -- the part of the budget that funds everything from education to environmental protection to veterans' health care and Head Start -- by $2.4 billion in nominal terms (i.e., before adjusting for inflation) -- and by about $15 billion or 4 percent after adjusting for inflation.

These cuts would hit nearly every area of the domestic budget. The budget also proposes to make permanent the President's 2001 and 2003 tax cuts, which would cost more than $900 billion over five years -- and an additional $1.5 trillion in the five years after that, for a total cost of $2.4 trillion over the next decade. The tax cuts primarily benefit the wealthiest Americans.

State and local governments services are at risk as well. Grants to state and local government for all programs other than Medicaid would decline by $18.9 billion or 7.4 percent from fiscal year 2008 to 2009, after adjusting for inflation. For the third year, the President has proposed $17.4 billion in savings to the Federal Medicaid program, savings that would come from shifting additional Medicaid costs to the states. Pennsylvania is would see a cut of $560 million for programs other than Medicaid, in Fiscal Year 2009.

For the CBPP analysis of the President's budget click here.

To read more about the impact of the proposed budget on funding for state services click here.