Trump budget calls for 2% reductions in discretionary spending after 2019

  • The White House budget calls for $3 trillion in deficit reduction, including $1.7 trillion in mandatory spending cuts.
  • The plan also proposes reducing discretionary spending by 2 percent a year after 2019.

The White House budget calls for $3 trillion in deficit reduction, including $1.7 trillion in mandatory spending cuts.

The plan also proposes reducing discretionary spending by 2 percent a year after 2019.

The 2019 budget, however, doesn't balance, marking a reversal from Republican priorities in recent years.

In a summary outline that circulated Monday, the White House said the budget accounts for increased spending caps in the massive $320 billion spending deal hashed out between Republicans and Democrats last week.

The budget also calls for $18 billion to construct a southern border wall, a key part of President Donald Trump's campaign pitch to voters in 2016. The proposal also allocates more than $2.5 billion for additional border-security initiatives, including for more Border Patrol and Immigration and Customs Enforcement staff and expanded capacity for detention.

The administration also released its long-awaited plan to stimulate more than $1.5 trillion in infrastructure projects. The White House budget proposes $200 billion in federal investment that focuses mainly on grants, "transformative projects" and rural infrastructure.

It would also reduce spending for health-care programs Medicare and Medicaid. The budget calls to cut funding for food assistance program SNAP.

Congress weighs in 

Congress ultimately sets spending levels. Many of the budget cuts the Trump administration calls for could not win support in Congress.

Lawmakers recently passed a budget agreement to set spending levels for fiscal years 2018 and 2019, which Congress will have to vote later to appropriate. The bipartisan plan would increase military and domestic spending over the two years.

Office of Management and Budget Director Mick Mulvaney will go before the Senate Budget Committee on Tuesday morning to explain and defend the proposal. The top Republican on that committee, Sen. Mike Enzi of Wyoming, called the White House proposal a "first step" in the 2019 budget process.

"Congress has the constitutional power of the purse and must make the final call on federal tax and spending priorities. I appreciate the President's effort to start the discussion for fiscal year 2019 and improve oversight of government programs," he said in a statement.

Meanwhile, panel ranking member Sen. Bernie Sanders, I-Vt., eviscerated the budget proposal as "morally bankrupt" and "bad economic policy."

"This is a budget for the billionaire class, for Wall Street, for corporate CEOs, for defense contractors and for the wealthiest people in this country. It must be defeated," Sanders said in a statement.

— CNBC's Mike Calia contributed to this report.