THE STATE OF THE UNION : The President’s Priorities

The objectives outlined in President Clinton’s State of the Union speech conflict with ever-more-restrictive budget constraints. In his 1995 budget, Clinton will ask for roughly $16 billion to finance new domestic initiatives--slightly more than half of the $29 billion he originally planned to request from Congress. But just to receive $16 billion--an 18% increase over last year’s investment agenda outlays--Clinton must reduce spending in “non-priority” programs. So far, the Administration has not disclosed a full list of winners and losers in the 1995 budget he will present to Congress on Feb. 7. But a partial list of those already divulged indicates the direction the Clinton agenda will take this year.

WINNERS

* EDUCATION--The largest increase in the education budget will go to Clinton’s Goals 2000 program, which is slated to receive $600 million to $700 million in funding. The initiative is designed to create national academic and skills standards for elementary and secondary schools.

* EMPLOYMENT--Labor Secretary Robert B. Reich plans to unveil a training-and-skills agenda to help U.S. workers remain competitive in the global economy. It will be highlighted by an initiative to transform the unemployment system into a “re-employment system,” with the long-term unemployed receiving educational and training opportunities.

* HEALTH AND WELFARE--A big beneficiary within the Department of Health and Human Services is the National Institutes of Health, which will get a 4.7% funding hike. Others include the Head Start program, targeted for an increase of $550 million to $1 billion; AIDS research, including funding for the Ryan White Act, and the WIC nutrition program for pregnant women and infants.

* LAW ENFORCEMENT--Among the short list of winners in the battle for scarce federal dollars are the Justice Department and crime prevention programs. To fund an anti-crime bill expected to pass Congress soon, the Administration has allocated an extra $2.5 billion for 1995 to help put 100,000 more police officers on the streets, provide money for “boot camps,” and finance prison construction. Over five years, the Administration plans to spend about $22 billion on anti-crime initiatives.

* COMMERCE--For the first time in memory, the Commerce Department has become a top priority at the White House. The Administration plans a 12% increase in the department’s budget for 1995, primarily to help fund new technology initiatives. One of the biggest beneficiaries is the Advanced Technology Program, an initiative to re-create the Pentagon’s success in fostering technological research and development on the civilian side. It would receive about $451 million in 1995, up from $190 million.

LOSERS

* HOUSING--The Department of Housing and Urban Development appears to be an unexpected casualty of the White House budget wars. The Administration is imposing new cuts on HUD that rival those of its Republican predecessors. For example, the Administration plans to cut programs for renovating and building traditional public housing by about $2 billion. Clinton is targeting programs that fund construction of new public housing units and renovate old ones. On the positive side of the ledger, programs for the homeless are expected to get a boost of about $1.5 billion.

* AGRICULTURE--Another big loser in the Clinton budget is the Agriculture Department, which was a major target of the Administration’s “reinventing government” task force. The 1995 budget will include a plan to close more than 1,200 farm program field offices.

* DEFENSE--The biggest blow of all will land at the Defense Department, which is feeling the effects of the end of the Cold War. Clinton decided not to give the Pentagon $21 billion to cover the anticipated costs of inflation over the next five years, and he told defense officials they must fund $9 billion in military pay raises over that period by taking money from other accounts.

* TRANSPORTATION--The Transportation Department fought off steep budget cuts proposed by the Office of Management and Budget, but the Administration still plans to cut operating subsidies for mass transit systems. The Federal Aviation Administration will see its budget frozen at 1994 levels.

* INTERIOR--Faced with steep budget cuts, the Interior Department will eliminate 860 jobs in its personnel division alone. Similar personnel cuts will be felt at a wide range of other agencies, ranging from Veterans Affairs to the Treasury.

The Administration’s proposal to provide $6.6 billion in emergency aid for earthquake-ravaged Southern California will not count against the budget ceilings, and therefore will not reduce the amount available for other Clinton priorities.