federal budget

Both before and after the new administration released its budget plan, SSTI was communicating with both parties to identify how Congress would react to significant budget reductions. The message we heard was clear and consistent: Congress would continue to fund its existing priorities. The FY 2017 Omnibus shows that legislators were true to their word. Innovation policymakers and practitioners throughout the country should take a moment to appreciate this…. and then prepare to both work with agencies on program implementation and vigorously advocate for FY 2018 and beyond. While we thank Congress for its support for innovation in the FY 2017 budget, the fight for FY 2018 funding will require even more effort because of greater involvement of the Trump Administration in the budget process and lowering of spending caps. Further, the consequences of the FY 2018 budget are likely to be greater as the budget may serve as the roadmap for the next several years.

The White House Office of Management and Budget today released America First: A Budget Blueprint to Make America Great Again, an overview of the administration’s proposal for the FY 2018 federal budget. This is a precursor for the full budget proposal, expected in May. The administration would increase spending authority for defense and security by $54 billion while decreasing all other discretionary spending by an equivalent amount. The White House would eliminate the Economic Development Administration, Appalachian Regional Commission and Delta Regional Authority, among others, along with all funding for the Manufacturing Extension Partnership and ARPA-E, and would impose significant reductions in research spending by most agencies.

The Trump Administration’s skinny budget proposal released today calls itself, “A Budget Blueprint to Make America Great Again.” From the information contained in the document, it is clear the Administration does not view science, technology, innovation and entrepreneurship and the economic development efforts built around those activities as the path forward to making “America great again.” The program eliminations and drastic cuts are not the way to move the country forward economically. So what is behind this proposal? Two things: 1) a fight over the proper role of the federal government in the economy, and 2) a negotiating tactic to attempt to lull advocates into thinking program survival or lesser cuts are a victory. A full community response is needed and all of us must get off the sidelines and on to the playing field.

The Trump administration’s initial proposal of a $54 billion increase in defense spending with the same amount being cut from non-defense spending would alter spending rules established in 2013, which set a cap on discretionary spending across the federal government and affected defense and non-defense spending equally. Press reports have indicated congressional opposition to this approach with a key House appropriator commenting, "The president will propose, and the Congress will dispose.” While the Office of Management and Budget (OMB) has provided top-line numbers to individual agencies as it works in preparing the FY 2018 budget request, those figures have not been released publicly. The full FY 2018 budget proposal is expected in late spring with an outline to be released mid-March.

Congress approved the National Defense Authorization Act for FY 2017, which now awaits the President’s signature. The bill includes several significant provisions for the innovation community, including:

The Senate Committee on Small Business and Entrepreneurship held America Without Entrepreneurs: The Consequences of Dwindling Startup Activity last week. Citing the decades-long decline in new business creation as a motivating factor, senators’ remarks and questions identified regulation and student debt as contributing factors to this decline and to supporting basic research and immigration policy as potential solutions. The majority of the discussion focused on geographic disparities in innovation and how to better share the promise of economic prosperity going forward.

The Senate Commerce Committee approved Wednesday the American Innovation and Competitiveness Act (AICA), a reauthorization of the America COMPETES Act. SSTI thanks Sen. Jerry Moran (R-KS) for his leadership in successfully offering an amendment to increase the authorization level for the Regional Innovation (RI) program to $30 million, which provides support for local innovation, entrepreneurship and economic growth. SSTI also recognizes Sen. Roy Blunt (R-MO) and Sen. Amy Klobuchar (D-MN) for their support of the organization’s priorities.