In a letter released Thursday, White House budget chief Jacob Lew told agency heads to submit financial blueprints with spending at least 5 percent below this year’s levels. He also asked them to present additional proposals that would trim spending by at least 10 percent.
The effort is aimed at living within the debt ceiling agreement the two parties recently hammered out. It included a series of spending targets and saved tens of billions of dollars in 2013.
“By providing budgets pegged to these two scenarios, you will provide the president with the information to make the tough choices necessary to meet the hard spending targets in place and the needs of the nation,” Lew wrote.
The White House has asked agencies in past years to propose similar savings. But Lew’s letter underscores the political positioning under way as President Barack Obama and congressional Republicans approach what is likely to be a fiery autumn battle over budget and economic issues.
With the economy flagging, Republicans say tax and spending cuts are what is needed. Obama plans a jobs proposal mixing tax cuts with construction initiatives. At the same time, a special new committee of lawmakers will try developing a compromise $1.5 trillion, 10-year package of debt reduction.
The fight will carry over from the partisan battle over increasing the nation’s borrowing limit; that consumed much of the spring and summer. It was resolved two weeks ago when the two sides agreed to try finding enough savings to reduce red ink by more than $2 trillion over the coming decade.
Federal agencies will consume more than $1 trillion of this year’s $3.8 trillion budget
Lew asked agency chiefs for the two budget scenarios as the administration plans for the 2013 spending year, which begins in October 2012. That budget plan will be released early next year.