We have to work together to make the hard choices necessary to control our deficit so we can afford necessary investments in our future. The President’s FY 2012 Budget will lay the groundwork for cutting programs we can’t afford while continuing to invest in innovation, education and infrastructure.

To encourage fiscal responsibility, the Budget will:

  • A five-year non-security discretionary spending freeze that will reduce the deficit by over $400 billion over the next decade and bring this spending to the lowest level since President Eisenhower sat in the Oval Office.
  • More than 200 terminations, reductions, and savings totaling more than $33 billion in savings for this year alone. Half of all agencies see their top line reduced from 2010 enacted levels.
  • Sample cuts: Community Development Block Grants by $300 million; LIHEAP in half or by $2.5 billion, Great Lakes Restoration Initiative by one-quarter or $125 million; more than $1 billion in grants to large airports; $950 million to states’ revolving funds for water treatment plants and other infrastructure.
  • Cuts $78 billion from the Pentagon’s spending plan over the next five years, bringing defense spending down to zero real growth. Including spending related to Iraq and Afghanistan, overall defense spending for 2012 is more than 5 percent below the 2011 request.
  • Pays for the first two-years of “doc fix” -- which will prevent a nearly 30 percent cut in reimbursements to doctors in Medicare and keep them seeing patients -- with $62 billion in new, specific health care savings, including recommendations from the Fiscal Commission and recent bipartisan proposals, that will strengthen program integrity and increase efficiency and accountability.
  • Pays for a three-year patch to prevent an increase in taxes on middle-class families through the Alternative Minimum Tax (AMT) by limiting the rate at which high-income earners can itemize tax deductions. This would bring the rate back to where it was during the Reagan Administration.
  • The President has called on Congress to work with the Administration on corporate tax reform that will simplify the system, eliminate special interest loopholes, level the playing field, and lower the corporate tax rate for the first time in 25 years – without adding a dime to the deficit.
  • The President lays out his principles to strengthen Social Security and has called on Congress to work on a bipartisan fashion to keep this compact with future generations.
  • Includes important Fiscal Commission recommendations such as: federal civilian worker pay freeze, medical malpractice reform, PBGC reform, and a government reorganization initiative.

White House White Board: The President's Budget

In this White House White Board, Jack Lew, Director of the Office of Management and Budget, explains how the President's Budget will help the government live within its means, while still investing in America's future.

Watch the White House White Board with Jack Lew
Discretionary Spending Chart

Non-Security Discretionary Spending

The freeze on domestic discretionary spending over the next five years in the President’s budget would cut the deficit by more than $400 billion over the next decade, bringing this kind of spending to its lowest share of our economy since Dwight Eisenhower was President.

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