Officials: Obama Will Propose Three-Year Spending Freeze

Officials: Obama will propose three-year spending freeze
By Steven Thomma | McClatchy Newspapers

Looking to signal at least one step toward reining in huge federal budget deficits, President Barack Obama will propose a three-year freeze in non-security discretionary spending, senior administration officials said Monday.

His budget proposal, to be unveiled in part with Wednesday's State of the Union speech and in detail next week, will urge Congress to keep overall spending at $447 billion a year for agencies other than those charged with national security and mandatory-spending programs such as Social Security and Medicare.

The freeze would take effect with the 2011 fiscal year starting Oct. 1, and wouldn't affect the $787 billion economic stimulus plan already being implemented, the officials said.

It also wouldn't affect a 154 billion jobs plan pending before Congress and backed by Obama, the officials said. One aide said that plan would be exempt because it would take effect this year, before the freeze.

Administration officials, who spoke on the condition of anonymity to not upstage the president, said that the three-year freeze would save $250 billion over a decade — if it's approved by an election-year Congress.

After three years, the total spent would be the lowest as a percentage of the total economy in 50 years. Spending on those agencies has increased by an average of 5 percent a year since 1993, the officials said.

Still, officials acknowledged that the savings wouldn't come close to eliminating the deficit and balancing the budget. "We're not here to tell you we've solved the deficit," one official said. Read more.