If the federal spending cuts known as sequestration stay in effect, they will lead to a historical low level of public investment—hindering a full economic recovery. Congress should set smarter priorities regarding discretionary spending to spur a full economic recovery and fund necessary public investments.
One path to smarter spending priorities is to cut Pentagon spending and use the savings to fund public investments. Currently, the United States’ defense budget is larger than that of the 10 countries with the next highest military budgets combined. With the Department of Defense proposing to reduce the Army to its smallest force since World War II, cutting Pentagon spending is both necessary and desirable. Conversely, non-defense discretionary spending that can be categorized as “investment”—programs that put people to work now but also benefit the economy for decades to come, such as physical infrastructure, education, and workforce development—must be expanded in order to spur economic expansion, increase job creation, and enhance economic opportunity for all.
The Congressional Progressive Caucus’ (CPC) “Better Off Budget” proposes both to increase the amount of discretionary spending in the federal budget, and to make non-defense discretionary spending a higher priority. Compared to the current spending trajectory, in 2024—the final year of the current “budget window”—under the CPC fiscal year 2015 budget proposal, the discretionary budget would be $127 billion higher. This figure incorporates both $104 billion less for Pentagon spending and $231 billion more for non-defense spending, with increases going toward budget functions that advance our national goals of expanding the economy and creating more broadly shared prosperity—education, income security, transportation and scientific research.
CPC Budget Would Increase Discretionary Spending, Boost Investment: Projected fiscal year 2024 discretionary budget authority (billions of dollars)
|National Defense||Education, training, employment, and social services||Income security||Veterans benefits and services||Health||Administration of justice||International affairs||Natural resources and environment||Transportation||General science, space, and technology||Other|
Source: Economic Policy Institute Policy Center analysis of Congressional Budget Oﬃce and Oﬃce of Management and Budget data.