Issue Date: March 9, 2009
Fiscal 2010 Budget Preview
PRESIDENT BARACK OBAMA released a $3.6 trillion 2010 spending plan on Feb. 26 with sweeping increases in spending on energy, education, health care, and science. The plan ends $2 billion in tax breaks for oil and gas companies, as well as other tax advantages for corporations and wealthy individuals. But it creates a $1.2 trillion deficit.
The plan is a policy document that lays out only general funding increases, except in a few areas that are particularly important to the Administration. The document discusses the $787 billion stimulus package but does not include these funds in the 2010 spending proposal. A detailed budget is expected in April.
"There are times where you can afford to redecorate your house, and there are times where you need to focus on rebuilding its foundation," the President said as he rolled out his budget policy plan. "Today, we have to focus on foundations."
One big winner would be EPA, which would receive $10.5 billion in 2010, an almost 35% jump over this year's likely appropriation. The budget overview includes plans to reinstate $1.2 billion for EPA's Superfund industrial cleanup program by 2011. The funds would be collected starting in 2011 through revival of an industry excise tax that expired in 1995.
The Obama budget also includes future funding that would be generated through a carbon dioxide cap-and-trade program. The goal, the document says, is to cut greenhouse gas emissions 14% from 2005 levels by 2020 and approximately 83% from those levels by 2050. These cuts mirror the more aggressive approaches to greenhouse gas reductions Congress is considering.
All the CO2 allowances would be auctioned to companies unable to make their assigned reductions of greenhouse gas emissions. Under the budget, about $79 billion in CO2 cap-and-trade revenues would be generated annually starting in 2012, and the new revenue would be divided between taxpayers and programs for clean-energy development.
For health-related work, Obama's proposal would provide $78.7 billion for the Department of Health & Human Services (HHS), down slightly from 2009. Although details about spending levels for agencies within HHS were not provided, additional funds are expected for FDA and NIH.
One of the most contentious parts of the President's fiscal 2010 budget for HHS is two proposals to lower drug costs. One supports an FDA effort to allow Americans to purchase prescription drugs from foreign countries. The other supports FDA efforts to approve generic biologics, which are biomolecule-based drugs typically produced by living cells. News of the proposals caused the stock prices of many large drug companies to tumble, some by more than 5%, on the day the plan was released.
In other areas, funding for NSF, NASA, the National Institute of Standards & Technology, and the National Oceanic & Atmospheric Administration is expected to increase in 2010. Funds for the Department of Energy would be reduced slightly, but the department will receive nearly $40 billion from the stimulus package. Support for the proposed Yucca Mountain Repository, in Nevada, would be cut to the bone while the Administration develops "a new strategy toward nuclear waste disposal," the budget proposal says.
The proposal received strong support from members of Congress and groups that see it as a means to spur energy development and to slow down climate change. But conservatives blasted the proposed spending plan for its deficit spending, its reliance on revenues generated through the CO2 reduction program, and its tax increases on wealthy Americans.
- Chemical & Engineering News
- ISSN 0009-2347
- Copyright © American Chemical Society