In a bold move, Trump’s economic overhaul proposes significant changes to the federal budget. The plan suggests a shift of $119.3 billion from non-defense to defense programs. Non-defense base discretionary funding could drop by 7.4%. This includes a 43.6% cut to the Department of Housing and Urban Development, reducing its funding from $77 billion to $43.5 billion.
The Department of Health and Human Services would see a decrease of 26.2%, dropping from $127 billion to $93.8 billion, while the Agriculture Department faces an 18.3% cut. Additionally, the overall discretionary spending request for 2026 is totaling $1.69 trillion, highlighting the administration’s focus on defense priorities. Rising prices have overshadowed the benefits of tax relief, complicating the economic landscape.
On the defense side, overall discretionary spending remains steady. The America First Opportunity Fund would receive $2.9 billion, and the Development Finance Corporation would get an increase of $2.8 billion. Additionally, funding for missile defense and military pay raises is included in the proposal.
Tax policy changes are also part of the plan. The One Big Beautiful Bill Act aims to deliver $30-$100 billion in refunds by early 2026. However, the wealthiest 1% would receive $14 billion more in tax cuts than the bottom 80% combined.
The poorest 40% could face tax increases, while the middle 20% may see modest cuts averaging $370.
Housing and energy assistance would take a hit, with $26.7 billion cut from federal rental assistance and the elimination of the Low Income Home Energy Assistance Program. This could raise energy costs for 6 million households.
In health, the budget proposal includes $500 million for a new initiative on nutrition and drugs but reduces funding for the National Institutes of Health and the Centers for Disease Control.
Economic development would also suffer, with funding for the Economic Development Administration eliminated and small business aid cut by 33.3%.
