Almost as soon as President Trump unveiled his proposed fiscal year 2018 budget — which would excise $54 billion in funding from most federal programs and funnel it into the military and the Department of Homeland Security — strong reactions from both sides of the aisle and various sectors of the business world flooded the media.
Treasury Secretary Steve Mnuchin, whose department would see a 4.1% cut from the fiscal year 2017 budget if Trump had his way, was upbeat in a two-sentence statement that his office issued shortly after the announcement.
“President Trump’s discretionary budget plan released today focuses Treasury on our core missions of collecting revenue, managing the nation’s debt, protecting the financial system from threats, and combating financial crime and terrorism financing,” Mnuchin said in the statement. “It will ensure that we have the resources we need to enforce the nation’s tax laws, while investing in cybersecurity and prioritizing resources on initiatives that promote technology, efficiency, and modernization across the agency.”
Across the political spectrum, House Financial Services Committee ranking member Rep. Maxine Waters — a California Democrat known for her fiery rhetoric against the financial services industry — predictably blasted the plan in a lengthy statement that labeled the Trump budget as “harmful” and singled out proposed cuts to the Department of Housing and Urban Development.
“Those cuts — which include drastic cuts to HUD’s major rental assistance programs and the elimination of funding for the Community Development Block Grant and HOME programs — would create suffering for whole communities, increase poverty, hunger, and homelessness, and reduce economic development opportunities across the country,” Waters said in the statement.
Waters also said that the Trump budget would lead to higher flood insurance premiums and generally harm low-income and other vulnerable Americans.
“This budget blueprint illustrates that Trump is more concerned with threatening the world with another nuclear arms race and sinking billions into a border wall than ensuring that all Americans have a home, good schools, access to affordable health care, and the financial security to retire,” Waters continued.
Meanwhile, the team at real-estate tracking firm Trulia put together some firm numbers about the exact effects of Trump’s 13.2% cut to HU, based on the minimal specifics given in the budget proposal. Trulia found that black Americans, city dwellers, and millennials would be the hardest hit, as these groups receive a proportionally greater amount of government housing benefits, such as rental assistance and federally-funded community programs.
But despite all the doom and gloom or boosterism — depending on where you looked — major players in the reverse mortgage industry emphasized patience. As RMD reported last week, National Reverse Mortgage Lenders Association president and CEO Peter Bell issued a statement urging the industry to wait until a more detailed budget was released, correctly pointing out that the proposal made no mention of the Home Equity Conversion Mortgage or the Federal Housing Administration’s mortgage insurance programs.
Shelley Giordano, chair of the Funding Longevity Task Force, had similar advice during a phone call with RMD last week, noting that HUD had generally worked to support and strengthen the HECM program across presidential administrations of both political stripes.
“In general, until somebody comes in and actually significantly cuts any of the programming, it’s all total conjecture,” Giordano said.
Written by Alex Spanko