WASHINGTON -- President Donald Trump on Wednesday asked all major Cabinet agencies to draw up proposals to cut their budgets by 5 percent next year, adding that he could grant some exemptions and suggesting that he would not ask the Pentagon to cut the full 5 percent.
"Get rid of the fat, get rid of the waste," Trump said at a meeting with Cabinet members. "I'm sure everybody at this table can do it."
Trump said he's heard of a money-saving strategy called the "penny plan" to reduce federal spending by 1 percent.
"Rather than go by the penny plan, we'll go by the nickel plan," he said.
Some Cabinet secretaries can probably cut more than 5 percent, he said.
"I believe we can actually do it easily," he said.
Trump was likely referring to the planning process that will go into the White House's budget request in the spring. But spending levels must be approved by Congress, and lawmakers have repeatedly dismissed the Trump administration's budget proposals.
The push reflects the GOP's pivot in recent days to float ideas to address the widening budget deficit, which has ballooned since Republicans took control of Washington.
A person briefed on Trump's new plan who was not authorized to speak on the record said the goal was a 5 percent average reduction in discretionary spending across federal agencies.
Trump said he wanted the defense budget lowered from $716 billion to $700 billion, which would be a reduction of about 2 percent.
The U.S. government is projected to spend $4.47 trillion next year, according to the Congressional Budget Office. Of that, roughly $1.36 trillion is "discretionary," or run through Cabinet agencies and appropriated by Congress each year. A 5 percent cut in that funding would amount to a $68 billion reduction.
A report Monday showed that the budget deficit had grown 17 percent last year to $779 billion, with projections that it would eclipse $1 trillion annually by 2020. The deficit as a share of total economic output was 3.9 percent in fiscal 2018, up 0.4 percentage point from the previous year. The government's fiscal year runs from Oct. 1 to Sept. 30.
Budget experts believe the deficit is growing because of a big increase in spending on the military and other programs, as well as last year's tax cut.
Because the government spends much more than it brings in through revenue, it must borrow money to cover the difference by issuing debt. Interest payments on the debt have already surpassed $300 billion a year and will grow rapidly as interest rates increase.
Trump's push for a reduction in spending Wednesday contrasts with past and current calls for spending increases elsewhere.
The president has also repeatedly and successfully pushed for more defense spending.
He has threatened to shut down the government if he doesn't secure at least $5 billion in December for the construction of a border wall, a shift from his repeated campaign promise that the wall would be paid for by Mexico.
Trump has also said Congress should appropriate money to deal with hurricanes and wildfires, breaking with a past GOP precedent that any new spending be offset by cuts elsewhere.
Trump in March signed a $1.3 trillion spending bill that boosted domestic and defense spending, though he said Wednesday that some of the domestic spending was "waste money" that he "would never have approved" had he not needed Democrats' support for his boost in military spending.
Republicans in recent days have expressed new concern about the deficit, and some conservatives within the party are pushing for spending reductions.
Republicans had spent much of President Barack Obama's administration complaining about the deficit and demanding spending cuts and fiscal restraint, but they have abandoned many of their pledges since Trump took office. Trump has not shown much interest in addressing the debt since taking over, saying tax cuts and higher spending will help grow the economy.
ENTITLEMENT PROGRAMS
Trump's comments came a day after Senate Majority Leader Mitch McConnell, R-Ky., said a much different approach was needed to address the deficit.
McConnell called for changes to entitlement programs like Medicare, Medicaid and Social Security, but he said changes to those programs couldn't happen unless Democrats took control of either the House or the Senate, because it would take leadership from both parties.
Democrats seized on McConnell's comments as a sign Republicans will put entitlements on the chopping block.
"This is the exact Republican playbook we've seen time after time," said Rep. John Yarmuth, D-Ky., who's in line to become Budget Committee chairman if Democrats win control of the House. He spoke on a Democratic conference call Wednesday with reporters.
Rep. Cheri Bustos of Illinois, a co-chairman of the Democratic policy committee, said McConnell is like a "thief" caught in midact but denying responsibility for the situation. She said he "showed his hand."
"This is the classic Republican bait and switch," said Sen. Chris Van Hollen of Maryland, who chairs the Senate Democrats' campaign committee.
"All of our candidates will be zeroing in on this issue," he said. "I'm sure all of our candidates will be letting voters know."
Changing entitlement programs would be a heavy lift for Congress. Lawmakers debated several proposals during Obama's tenure, including changes to Social Security, only to have the efforts collapse in failure after months of negotiations.
During the 2016 campaign, Trump vowed not to pursue cuts to Medicare, Medicaid and Social Security, which represent roughly 50 percent of the budget.
Since his election, Trump has backtracked and said he would seek big cuts in Medicaid, a health care program for the poor, but he has mostly refused reductions in Medicare and Social Security.
Trump has already signed a spending bill into law that funds most federal agencies, including the Pentagon, through Sept. 30, 2019. But spending on other programs, including homeland security, expires in less than two months, and he has threatened a partial government shutdown if he doesn't secure more money for a border wall.
Information for this article was contributed by Damian Paletta and Seung Min Kim of The Washington Post; by Alyza Sebenius of Bloomberg News; and by Lisa Mascaro and staff members of The Associated Press.
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