Committee Passes Budget Resolution for Fiscal Year 2010

WASHINGTON – The House Budget Committee today passed by 24 to 15 a budget resolution for Fiscal Year 2010 that embraces President Obama’s goal of cutting the deficit in half by 2013 and funding critical initiatives in health care, energy, and education.

Chairman John Spratt stated: “President Bush has left President Obama a hard hand to play: an economy in crisis and a budget in deep deficit — in deficit this year alone by $1.752 trillion. President Obama has responded with a budget that meets the challenge head-on. Our budget reflects his major priorities.”

Spratt said the deficit President Bush left behind constitutes a massive 12.3% of Gross Domestic Product (GDP), at least two-thirds of which stems from tax and spending policies undertaken by the Bush Administration. “Almost everyone would agree that this is an unsustainable deficit,” he said.

The House Budget Resolution – a five-year plan that uses economic assumptions by the Congressional Budget Office (CBO) – reduces the deficit to $586 billion in 2013, which is 3.5% of GDP, and roughly the rate of growth in the economy for that year.

“Reducing the deficit is key,” said Spratt, “but our budget is not so committed to deficit reduction that it overrides other needs.”

The resolution, like President Obama’s budget, puts defense spending on a more sustainable path, with an increase of 4%. It also supports initiatives to make the economy more productive – in health care for the millions uninsured; in alternative energies to reduce dependence on foreign oil and the depletion of the environment; and in education and Pell Grants in particular, expanding access to college for more people. The initiatives in health care, energy, and education are all implemented in a fiscally responsible way.

In addition, the resolution extends the middle-income tax cuts adopted in 2001 and 2003: the 10% bracket, the child tax credit, and marital penalty relief. It indexes the AMT – the alternative minimum tax – to keep it from burdening middle-income taxpayers for whom it was never intended. The resolution also extends estate tax exemptions at the 2009 levels, and indexes the exemptions for future years.

“Our resolution puts the budget back on a fiscally sustainable path while advancing key priorities in health care, energy, and education,” said Spratt. “These are goals that the American people support. I was pleased to see our budget adopted by the committee and look forward to bringing it to the House floor next week.”