Revised March 5, 2004



PDF of full report

Press Release:
Deep, Widespread Cuts in Domestic Programs Over Next Five Years Under Administration Budget

Related Report:
Concentrating on the Wrong Target: Bush Cuts Would Reduce Domestic Discretionary Spending, As A Share of GDP, To Its Lowest Level in 46 Years

Fact Sheet:
Broad Cuts in Domestic Programs After 2005 Under Administration Budget

View Related Analyses

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The President’s budget calls for significant cuts in domestic discretionary spending over the next five years.  (“Discretionary” programs are those whose funding is determined by the 13 annual appropriations bills.  The term excludes entitlements, such as Medicare or veterans’ pensions.)  While attention has focused on programs the President proposes to cut or to increase in 2005, there has been far less attention to the longer-run plan included in the President’s budget to cut discretionary spending in nearly all domestic areas of the government in the years from 2006 to 2009.

By 2006, funding for most domestic discretionary programs outside homeland security would be cut below the 2004 funding levels for those programs adjusted for inflation (i.e., below the Office of Management and Budget baseline).  Moreover, the cuts would grow over time.  By 2009, the Administration’s budget would set funding for these programs $49 billion below the OMB baseline, a 12 percent cut in funding.  By contrast, defense and homeland security programs would be funded above the OMB baseline in all years from 2005 to 2009.[1]

The budget also would institute binding discretionary caps that would essentially lock in place this level of reduction in domestic discretionary programs.  Under the President’s budget proposals, if Congress approved funding for discretionary programs above the capped levels, across-the-board cuts would be made automatically.

There is a good reason that the cuts proposed for years after 2005 have largely been overlooked in initial reporting on the budget.  The budget tables that would normally show these cuts are missing from the budget books that OMB issued on February 2.[2]  To find these cuts, one must access a 1,000-page OMB document that covers all budget accounts and underlies the budget and that has been provided, in conjunction with the budget, to the House and Senate Budget Committees and the Congressional Budget Office.[3]

Analysis of the OMB document shows:

Figure 1

Among the programs or program areas that would be cut are the following:

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End Notes for Summary:

[1] If the Administration’s FY2009 domestic discretionary funding levels are compared to the CBO baseline, the cut in 2009 is $45.4 billion, or 10.4 percent below the FY2004 level adjusted for inflation.  This analysis compares OMB proposed funding levels to the OMB baseline rather than the CBO baseline for ease of analysis.  The CBO baseline is slightly lower in aggregate than the Administration’s because of lower inflation projections.

[2] Starting with the FY 1998 budget, one of the volumes released with the budget — known as the Analytical Perspectives — included proposed funding figures for the budget year and the next four years.  This is the first budget in seven years that has not shown the Administration’s proposed funding levels in the four years after the budget year.

[3] This document can be accessed on the OMB Watch website at:

[4] See Appendix B for a description of these budget functions.

[5] The Commerce and Housing Credit function would not be cut in 2009 below the CBO baseline, but discretionary spending in the function would be cut in 2005 through 2008.  The 2009 increase is necessary to fund the 2010 Census.  Other activities in the function would be cut in 2009.