Human Services News

National Priorities Project:

The budget process this year began with a whimper and ended with even less, as Congress failed to act on 11 out of 13 appropriation bills and deferred this year's business to next year's Congress.

At the beginning of February, the administration released its budget request for fiscal year 2007.

It proposed deep cuts to the provision of domestic goods and services, while also making permanent the tax breaks that disproportionately benefit the wealthiest Americans.

A week later, the administration submitted to Congress yet another request for more war spending.

By the end of the year, Congress left most of the government running on last year's budget allocations but passed more war-related spending and extended corporate tax cuts.

This year more than half of the tax cuts went to the wealthiest 10 percent, and more than one-fourth went to just the top one percent.1 The tax policy changes also represent a drain on federal revenues and are the largest contributor to the significant deficits of the past six years.

Now, the projection for the same period is a deficit of $2.7 trillion.2 While increases in military spending also had a considerable impact on these numbers, the tax cuts are even more important to changing the budget outlook.

Congress passed the request with few modifications, bringing spending on just the Iraq War in FY2006 to $100 billion.

Combined with money already spent or allocated, the total cost of the Iraq War rose to nearly $380 billion.