What Obama Got Right in His Budget

Dave Johnson

President Obama’s budget proposal is officially released into the wild. The president and the media are talking a lot about what the budget’s deficit reductions offer to satisfy the priorities of the 1 percent – the donor/owner class. But there are things in this budget that help the economy and the rest of us, too.

From the President’s Budget Message,

A growing economy that creates good, middle class jobs—this must be the North Star that guides our efforts. Every day, we should ask ourselves three questions as a Nation: How do we attract more jobs to our shores? How do we equip our people with the skills they need to get those jobs? And how do we make sure that hard work leads to a decent living?

This Budget seeks to answer each of these questions.

Our first priority is making America a magnet for new jobs and manufacturing.

Good Things In The Budget

There are several good things in the budget for the job creation engines of our economy: manufacturing, green energy, education, R&D and infrastructure. These include:

Manufacturing:

“President Obama is committed to making America a magnet for jobs and manufacturing so that we can continue to build things the rest of the world buys.”

  • $1 billion for the creation of a network of 15 of hubs across the nation like the Manufacturing innovation institute created in Youngstown, Ohio last year.
  • New initiatives to support manufacturing communities, including a new tax credit to strengthen their ability to attract investments and jobs.
  • Expands the Administration’s SelectUSA initiative to help draw businesses and investment from around the world to our shores.

R&D:

“Maintains a world-class commitment to science and research, targeting resources to those areas most likely to contribute directly to the creation of transformational technologies that can create the businesses and jobs of the future.”

  • Increases non-defense R&D by nine percent from the 2012 levels.
  • Expands and simplifies the Research and Experimentation Tax Credit and makes it permanent

Investments in energy – “all-of-the-above” strategy:

Cleaner energy will play a crucial role in meeting the President’s goals of reducing greenhouse gas emissions in the range of 17 percent below 2005 levels by 2020, and enhancing national security by reducing dependence on oil.

  • Investing in clean energy research and development;
  • Promoting energy efficiency in our cars, homes, and businesses;
  • A new goal to cut in half the energy wasted by America’s homes and businesses, with action aimed at doubling the economic output per unit of energy consumed in the United States by 2030, relative to 2010 levels.
  • The Better Buildings Challenge, continuing to lead through Federal energy efficiency, improving energy data access for consumers through the “Green Button” initiative, and making appliances even more efficient—saving consumers money, spurring innovation, and strengthening domestic manufacturing.
  • Expands applied research and development of innovative manufacturing processes and advanced industrial materials, and builds on the President’s Executive Order to accelerate investment in industrial energy efficiency, including setting a new challenge to achieve 40 gigawatts of new combined heat and power by 2020.
  • Encouraging responsible domestic energy production; and launching new efforts to combat the threat of climate change.
  • Establishes a new Energy Security Trust funded by royalty revenue from oil and gas leases to support initiatives to shift our cars and trucks off oil, cutting our Nation’s reliance on foreign oil.

Rebuilding our Nation’s infrastructure:

  • s $50 billion for up-front infrastructure investments, including a “Fix-it-First” program that makes an immediate investment to put people to work as soon as possible on our most urgent repairs, like the nearly 70,000 structurally-deficient bridges across the country
  • Creates a Rebuild America Partnership to attract private capital to upgrade what our businesses need most: modern ports to move our goods; modern pipelines to withstand a storm; and modern schools worthy of our children.
  • Modernize and improve the efficiency of the Federal permitting process, cutting through the red tape that has been holding back even some of the most carefully planned infrastructure projects

Education:

  • A proposal that ensures 4-year-olds across the country have access to high-quality preschool education through a landmark new initiative in partnership with the States.
  • Includes a new competitive fund that will help redesign America’s high schools to prepare students with the real world skills they need to find a job right away or go to college. The fund rewards schools that develop new partnerships with colleges and employers, and create classes focusing on science, technology, engineering and mathematics (STEM)—the skills today’s employers seek to fill the jobs available right now and in the future.
  • Includes reforms that will ensure affordability and value are considered in determining which colleges receive certain types of Federal aid.
  • Includes additional measures to promote STEM education, such as launching a new STEM Master Teacher Corps, to leverage the expertise of some of America’s best and brightest teachers in science and mathematics, and to elevate the teaching of these subjects nationwide. It also includes a reorganization and consolidation of STEM education programs to improve the effectiveness of Federal investments in this area.

The Center for Effective Government has a side-by-side chart comparing the different budget plans with what polls show the public wants here,

On education, road and bridge repair, and help for the nation’s poor, the president and his allies in the Senate reflect public opinion. According to a February poll from the Pew Research Center, 89 percent of Americans want to keep funding for education the same or increase it. Eighty-one percent say shoring up our country’s infrastructure is important, and 71 percent support assisting those hit by hard times. The president’s budget and the plan from Sen. Patty Murray (D-WA) maintain or increase funding for these programs. The budgets from Rep. Paul Ryan (R-WI) and the Republican Study Committee deeply cut federal funding in all three areas.

Although 87 percent of Americans also support maintaining or increasing spending on Social Security, the president has proposed modifying the way cost of living is estimated (to the chained CPI). With this change, the value of the Social Security benefits an elderly widow receives would fall by five percent over 12 years. The median income of single seniors is less than $18,000 per year, and since they spend a larger percentage of their income on medicine than other Americans, a decline of this size could do real harm.

Hopefully the Republicans won’t realize there are initiatives in this budget that create jobs.
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