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2018 State of the Union: Line-by-line Cost Analysis Identifies $107 Billion in Spending Hikes

National Taxpayers Union Foundation’s State of the Union (SOTU) cost analyses detail the outlay impact of all the actionable proposals made during the President’s annual address to Congress. President Trump’s speech included six proposals, two of which could not be scored due to insufficient details, that would increase annual spending by $107.2 billion.

Below are the President’s proposals, in his own words, followed by detailed notes regarding their spending impact, and charts with historical comparisons to previous SOTU Addresses.

1. “Tonight, I am calling on the Congress to produce a bill that generates at least $1.5 trillion for the new infrastructure investment we need. Every federal dollar should be leveraged by partnering with state and local governments and, where appropriate, tapping into private sector investment -- to permanently fix the infrastructure deficit. Any bill must also streamline the permitting and approval process -- getting it down to no more than two years, and perhaps even one.”

Net Annualized Cost: $20 billion ($200 billion over ten years)

Notes: President Trump’s FY 2018 budget proposal included a similar plan to boost federal spending by $200 billion over a decade to leverage $1 trillion in total infrastructure investment. According to recent reports in the New York Times and USA Today, the Administration now believes they will be able to leverage additional resources from that federal funding stream. This estimate could be lower if existing federal funds for infrastructure are reprogrammed, but details are unavailable. The Congressional Research Service’s analysis of the FY 2018 budget noted, “The budget proposes  an increase in infrastructure spending, which would result in total outlays increasing by $200 billion over the FY2018-FY2027 period.”

2. “ … [L]et us invest in workforce development and job training. Let us open great vocational schools so our future workers can learn a craft … .”

            Net Annualized Cost: Indeterminate

            Notes: A cost estimate is unavailable.

3. “And let us support working families by supporting paid family leave.”

Net Annualized Cost: $1.9 billion ($19 billion over ten years)

Notes: President Trump’s FY 2018 budget proposal included a similar plan to spend $19 billion over ten years to implement a paid leave program.

4. “ … [T]his year we will embark on reforming our prisons to help former inmates who have served their time get a second chance.”

Net Annualized Cost: Indeterminate

Notes: It is uncertain what reform President Trump would support to achieve this policy. Related legislation introduced in the previous Congress, H.R. 759, the Recidivism Risk Reduction Act of 2016, would have required the Department of Justice to assess prisoner risks for recidivism and, as necessary, encourage them to participate in programs to reduce recidivism. The Congressional Budget Office (CBO) estimated the proposal would increase spending by $210 million over five years.

5. “We have proposed new legislation that will fix our immigration laws, and support our [Immigration and Customs Enforcement] and Border Patrol Agents … . … [The plan] offers a path to citizenship for 1.8 million illegal immigrants who were brought here by their parents at a young age … fully secures the border.  That means building a wall on the Southern border, and it means hiring more [Border Patrol Agents] … end[ing] the dangerous practice of ‘catch and release’ …end[ing] the visa lottery … [and ending] chain migration.”

             Net Annualized Cost: $3.3 billion ($33 billion over ten years)

Notes: This is a partial estimate.

The Washington Post reports that the Trump Administration is asking for $33 billion over ten years, including $18 billion for construction of a southern border wall.

Related legislation, H.R. 3440, the Dream Act of 2017, has been introduced to allow certain noncitizens who arrived in the U.S. before the age of 18 to receive lawful permanent resident status. CBO estimated that a version of the bill from 2016 would increase outlays by $26.8 billion over the next ten years, including $11.8 billion for health insurance subsidies through the Affordable Care Act’s (ACA) exchanges. However, CBO’s projections of the ACA since 2010 have significantly overstated exchange enrollment and the agency is in the process of revising the model it uses to estimate health care insurance. Additionally, that proposal would not eliminate chain migration. CBO estimated that an additional 80,000 people would receive resident status as they are sponsored by beneficiaries of the Dream Act.

Through enhanced border security and the elimination of the diversity visa lottery and chain migration, outlays for federal programs such as the Affordable Care Act’s health insurance exchanges would be reduced, but a current cost estimate is unavailable.

6. “ …  I am asking the Congress to end the dangerous defense sequester and fully fund our great military.”

Net Annualized Cost: $82 billion (first-year cost)

Notes: The Washington Post reported that President Trump’s 2019 budget will request $716 billion for defense. CBO’s current defense baseline for FY 2018 is $634 billion.

In addition, President Trump notes, “As part of our defense, we must modernize and rebuild our nuclear arsenal, hopefully never having to use it, but making it so strong and powerful that it will deter any acts of aggression.” His FY 2018 year budget largely continued the nuclear modernization programs begun during President Obama’s administration. In October, 2017, CBO estimated that the modernization plan, costs would rise from current funding level of $27 billion per year to an average of $40 billion over the next thirty years. (CBO’s report also included alternative options that would reduce the net cost if included in the plan.) A Trump administration review of the nation’s nuclear posture was initiated in April 2017 and a final report is expected to be released this February.

 

 

An archive of NTUF's previous SOTU analyses is available.