Trump Budget Cuts Eliminates HUD

Trump Budget Cuts Eliminates HUD by 2026 Tax Cuts While Favoring the Wealthy

In a new commentary, “Signs Suggest Trump Budget Will Feature Unprecedented Cuts Plus Large Tax Cuts Favoring Wealthy,” Robert Greenstein, president of the Center on Budget and Policy Priorities, outlines the devastating signs coming out of the Trump Budget Cuts especially on HUD.

The growing signs suggest that the forthcoming Trump budget may contain cuts harsher than those in recent House GOP budgets. These recent budgets would have already slashed programs and services across much of the budget.

  • The budget Republicans approved last spring, for example, contained a stunning $6 trillion in domestic cuts over ten years, shrinking spending outside of Social Security, Medicare, and interest payments to just 7 percent of gross domestic product.
  • That’s less than three-fifths its average level over the past 40 years and a little more than half its average level under President Reagan.

Yet those unprecedented cuts may not be enough for the Trump Administration.

It is chilling to think about the cuts that may be coming.

Writes Greenstein:

“Cut non-defense discretionary programs by $2.5 trillion over the decade, slashing this spending by one-third next year and in half in 2026. The plan would eliminate large chunks of departments (sometimes by shifting their responsibilities to the states but without accompanying funding) and undermine federal responsibilities in areas ranging from rural development and transportation infrastructure to energy research, environmental protection, pre-school education, and low-income housing. These cuts would come on top of the cuts imposed by the 2011 Budget Control Act (BCA), which already are pushing these programs to their lowest level on record as a percent of the economy, with data back to 1962.”

Reports say the Trump team is meeting with career staff to assemble a budget with $10 trillion or more in savings, of which about $8.5 trillion would be cuts to programs outside defense.

“Many of the cuts in the Trump team’s blueprint come from plans that the Heritage Foundation and the Republican Study Committee (RSC) issued last year, according to The Hill.

The Heritage report called for more than $8½ trillion in non-defense cuts (slightly over $10 trillion in savings when the effects on interest payments are taken into account; see box), while the RSC report called for almost $7½ trillion in such cuts.”

These further and deep, deep cuts would eliminate the Dept. of Housing and Urban Development (HUD) by 2026.

  • It transfers fiscal responsibility of the major subsidized housing assistance programs including Section 8, HOME and public housing to state governments,
  • Federal funding for means-tested housing programs such as Section 8, Home and public housing should be phased down at a rate of 10 percent per year for 10 years.
  • Each state should be allowed to determine how and to what extent it will replace federal housing programs with alternative programs designed and funded by state and local authorities.
  • Eliminates the Community Development Block Grant program in FY 2018,
  • Eliminates two key elements of federal housing finance, and
  • Homeless assistance programs and Housing Opportunities for Persons with AIDS programs should be transferred to the Department of Health and Human Services.
  • HUD-Veterans Affairs Supportive Housing Vouchers (HUD-VASH), a veteran’s assistance program that operates in conjunction with the Housing Choice Voucher program should be transferred to the Department of Veterans Affairs.

Impact of Budget Cuts on HUD“Cuts of these magnitudes would have devastating effects on tens of millions of less fortunate families and on an array of basic services that middle-income Americans, as well, rely on. State and local governments, too, would be sharply affected, since a large share of federal domestic programs operate as grants to states and localities, which deliver basic services such as education, highways and mass transit, child nutrition, rental subsidies, clean water, and health care through Medicaid.”

Concludes Greenstein:

“As a result, the forthcoming Trump budget is likely to represent the largest Robin Hood-in-reverse proposal from any President in modern U.S. history, shifting substantial amounts of income from people of modest means to those who already possess enormous wealth.”

CBPP Report

Heritage Foundation Blueprint

Heritage Foundation Blueprint Impact on HUD

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