Feb 26 President Barack Obama's first budget is his clearest opportunity to date to put U.S. money where his mouth is by establishing priorities for his new administration.
The proposals will be submitted to the U.S. Congress, which will put its own stamp on the budget. [nN26448503]
Here are some winners and losers in the draft submitted to Congress on Thursday, according to senior administration officials:
* THE BANKING INDUSTRY. The budget sets aside $250 billion as a "placeholder" if Obama decides to ask Congress for more money to help the troubled U.S. financial system. Officials said such a decision has yet to be made.
* CLIMATE CHANGE POLICY. The budget includes billions of dollars in revenues, starting in 2012 and lasting many years, from a greenhouse gas emissions trading system, one of Obama's key proposals to fight global warming.
* HEALTHCARE OVERHAUL. The budget includes a 10-year, $634-billion reserve fund to help pay for the president's proposed healthcare reforms.
* PUBLIC WORKS. Officials are trying to jolt the faltering economy in the face of 14 months of recession with public-works spending.
* MIDDLE CLASS. Tax cuts would benefit the U.S. middle class.
* DEFENSE SPENDING. The budget projects costs of the Iraq and Afghanistan wars of just over $140 billion this year and $130 billion in the 2010 fiscal year that begins Oct. 1, 2009. Annual costs will drop after that to $50 billion annually.
Washington spent about $190 billion on the wars in 2008. Obama looks likely to order U.S. combat troops to withdraw from Iraq over about 18 months, according to U.S. officials. At the same time, he is ramping up the U.S. military effort in Afghanistan. Obama also wants to wring savings out of budget procurement.
* WEALTHIER AMERICANS. The budget envisions tax increases on wealthier Americans to help reduce the deficit. Obama would boost tax collection from about 16 percent of the economy this year to 19 percent in 2013.
* BIG AGRIBUSINESS. The budget lays out spending cuts in agriculture subsidies. The budget would phase out government payments to crop producers making more than $500,000 -- saving $9.8 billion over 10 years -- and eliminate subsidies for cotton storage, saving an additional $570 million over the same period.
(Reporting by Caren Bohan and Jeff Mason, Editing by Bill Trott)
Our top photos from the last 24 hours.