Trump Budget

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ASU Economist Dennis Hoffman takes a look at the budget proposed by President Trump.

TED SIMONS: COMING UP NEXT, THE IMPACT OF THE PRESIDENT'S BUDGET PLAN ON ARIZONA. AND TONIGHT WE WILL HEAR ABOUT SOME OF THE NEW STATE LAWS THAT WILL GO INTO EFFECT. AND WE WILL GET A LOOK INSIDE THE BUSINESS OF A MEDICAL MARIJUANA DISPENSARY. THOSE STORIES NEXT ON "ARIZONA HORIZON."

NARRARATOR: "ARIZONA HORIZON" IS MADE POSSIBLE BY CONTRIBUTIONS FROM THE FRIENDS OF ARIZONA PBS, MEMBERS OF YOUR PBS STATION.

TED SIMONS: GOOD EVENING, I AM TED SIMONS. THE STATE SUPREME COURT TODAY SET A LONG-RUNNING CAMPAIGN FINANCE CASE AGAINST FORMER ATTORNEY GENERAL TOM HORNE DIDN'T RULE ON THE ALLEGATIONS THAT HORN BROKE CAMPAIGN FINANCE LAWS BUT RULED HORN WAS DENIED DUE PROCESS BECAUSE OF THE WAY THE STATE HANDLED SUCH ALLEGATIONS. A SEPARATE CASE INVOLVING CLAIMS HORN USED THE AG'S OFFICE AS A HEADQUARTERS IS STILL ONGOING. AND GARY PIERCE, FORMER CORPORATION COMMISSIONER, HAS BEEN INDICTED BY FEDERAL PROSECUTORS FOR FELONY CONSPIRACY, BRIBERY, MAIL AND WIRE FRAUD OVER ALLEGATIONS UTILITIES OWNER, GEORGE JOHNSON, PAID PIERCE OVER $31,000 IN EXCHANGE FOR FAVORABLE ACTIONS WHILE PIERCE WAS ON THE CORPORATION COMMISSION. PIERCE'S WIFE WAS INDICTED IN THE CASE ALONG WITH JOHNSON AND A LOBBYIST WHO IS ARGUING ON JOHNSON'S BEHALF. PRESIDENT TRUMP RELEASED HIS BUDGET PLAN EARLIER THIS WEEK AND THE PROPOSAL WOULD CUT MONEY FOR SAFETY NET PROGRAMS LIKE FOOD STAMPS AND DISABILITY PAYMENTS BUT THE MILITARY AND BORDER SECURITY PROGRAMS WOULD SEE AN INCREASE IN FUNDING. HERE TO TALK ABOUT THE BUDGET PLAN AND WHAT IT MEANS FOR ARIZONA IS DENNIS HOFFMAN, PROFESSOR AND ECONOMIST AT THE ARIZONA SCHOOL OF BUSINESS. WE TALKING ABOUT THIS AND WE WILL GIVE IT ITS DUE DILIGENCE AND WE WILL VET THIS THING. IS IT DOA? IS THIS THING EVER GOING TO BE LIKE IT IS?

DENNIS HOFFMAN: LET'S BACK UP A LITTLE BIT. THE OLD ADAGE IS ELECTIONS HAVE CONSEQUENCES. THIS IS AN AUSTERITY BUDGET. THERE ARE CUTS FAR AND WIDE, BIGGER IN SOME AREAS, SMALLER IN OTHERS, A LITTLE BIT OF GROWTH IN SAY, DEFENSE, BUT NOT ENOUGH FOR SOME, I GUESS. IT SENDS A SIGNAL THE PRESIDENT WANTS TO GO AUSTERITY HE HAS A CONGRESS THAT MANY IN CONGRESS HAVE SAID THE SAME THING. THE LIKELY OUTCOME IS NOT COMPLETELY IN LINE WITH THE PRESIDENT'S BUDGET BUT CERTAINLY REDUCTIONS.

TED SIMONS: IN GENERAL, MORE IDEOLOGICAL THAN A REAL BUDGET PLAN?

DENNIS HOFFMAN: WELL, TO ME WHAT IT ALL DEPENDS UPON ARE VERY OPTIMISTIC GROWTH ASSUMPTIONS. IF YOU GET ECONOMIC GROWTH AND PROSPERITY AS LEVELS PROJECTED BY PRESIDENT TRUMP'S BUDGET OFFICE AND PRESIDENT TRUMP'S TEAM THEN THE ARGUMENT WOULD BE WE DON'T NEED AS MUCH IN THE WAY OF PUBLIC ASSISTANCE AS WE HAVE NEEDED IN RECENT YEARS SO WE DON'T MAKE THOSE GROWTH ASSUMPTIONS, THINGS ARE GOING TO BE TOUGH ON MEDICARE RECIPIENTS, LET'S SAY.

TED SIMONS: LET'S TALK ABOUT THE IN-STATE PRIORITIES THAT COULD BE AT RISK. JAILING UNDOCUMENTED IMMIGRANTS. SOMETHING LIKE THAT AT RISK?

DENNIS HOFFMAN: WELL, THE PRESIDENT IS REALLY PROPOSING A LOT MORE ENFORCEMENT AT THE FEDERAL LEVEL. WHAT THEY ARE ACTUALLY GETTING RID OF IS SUPPORT, FEDERAL SUPPORT, FOR LOCAL JAILING OF UNDOCUMENTED PEOPLE. THAT HAS A LOT OF LOCAL SHERIFFS IN ARIZONA PRETTY ENERGIZED OVER THAT.

TED SIMONS: WHAT ABOUT THE IDEA OF FUNDING RIGHT -- LIGHT RAIL PROJECTS?

DENNIS HOFFMAN: THE FEDERAL GOVERNMENT IS GOING TO BACK AWAY AND LEAVE IT TO LOCAL GOVERNMENTS. YOU WANT YOUR LIGHT RAIL, FIND A WAY TO FUND IT YOURSELF. YOU WANT YOUR I-11, FUND IT YOURSELF. THAT SEEMS TO BE THE SIGNAL.

TED SIMONS: BLOCK GRANTS TO HELP LOW-INCOME FAMILIES, BLOCK GRANTS FOR SENIORS AND THOSE WHO ARE DISABLED. BLOCK GRANTS IN GENERAL.

DENNIS HOFFMAN: 13% CUT IN HUD. AND A LOT OF THOSE BLOCK GRANTS HAVE BEEN USED IN INNOVATIVE WAYS ANYWHERE FROM LOCAL COMMUNITY GRANTS TO FIRE STATIONS. A LOT OF LOCAL JOBS DEPEND ON THEM TODAY. THERE AGAIN IS A QUANDARY. ALL OF THESE JOBS ARE GOING TO BE CREATED BY THIS PROGRAM OF PROSPERITY BUT WHEN YOU TAKE AWAY PROGRAMS LIKE THIS YOU LOSE JOBS. SO THAT MEANS THAT MANY MORE JOBS WILL HAVE TO BE CREATED TO OFFSET THE JOB LOSS.

TED SIMONS: IF THE GROWTH IS SUCH THAT WE GET MORE JOBS, YOU BETTER HAVE ENOUGH TO TAKE THE PLACE OF THE JOBS THAT ARE LOSS.

DENNIS HOFFMAN: YEAH, HERE AND IN HEALTH CARE AND WHATEVER ELSE.

TED SIMONS: FEDERAL FUNDING FOR LOCAL LAW ENFORCEMENT. AS YOU MENTIONED, MUNICIPALITIES AROUND THE STATE THINKING WHAT IS GOING ON HERE?

DENNIS HOFFMAN: WELL, RIGHT. A LOT OF THE RHETORIC AROUND THE ELECTION WAS, YOU KNOW, THIS IS GOING TO BE A LAW AND ORDER PRESIDENT. A LAW AND ORDER ADMINISTRATION SO THEREFORE I THINK LAW ENFORCEMENT OFFICIALS AT ALL LEVELS OF GOVERNMENT FROM FEDERAL, TO STATE, TO LOCAL THOUGHT WE WILL FINALLY GET THE SUPPORT WE NEED.

TED SIMONS: HOW STRONG WILL ARIZONA'S CONGRESSIONAL DISTRICT FIGHT FOR THOSE THINGS WE LISTED?

DENNIS HOFFMAN: YOU ARE DEALING WITH AN ECONOMIST BUT IT SOUNDS MORE LIKE A POLITICAL PROBLEM.

TED SIMONS: IT DOES. SO WHAT DO YOU THINK?

DENNIS HOFFMAN: WELL, LOOK, PART OF THAT SENTIMENT IS DRIVEN BY THEIR PERCEPTION OF WHERE THE SENTIMENT IN ARIZONA LIES. I THINK IT IS VERY CLEAR THAT ARIZONA RESIDENTS SUPPORTED PRESIDENT TRUMP IN THE ELECTION. I THINK THERE IS A LOT OF SUPPORT FOR PRESIDENT TRUMP THAT REMAINS AND PRESIDENT TRUMP'S AGENDA. BACKING OUT OF FEDERAL PROGRAMS, TAX CUTS, THEN YOU HAVE GOT DEFICITS RUNNING AROUND HERE. SO, IT IS ALL GOING TO DEPEND, IT SEEMS TO ME ON WHAT THEIR PERCEPTION IS ON WHAT THE IMPACT IS GOING TO BE FOR THEM. ARE THEY IN FAVOR OF, SAY, A BORDER WALL? ARE THEY IN FAVOR OF GETTING RID OF NAFTA? YOU KNOW, ARE THEY IN FAVOR OF SOME OF THE PROPOSALS THAT THE PRESIDENT HAS ADVANCED? IF THEY SEND STRONG SIGNALS THEY ARE I THINK YOU WILL FIND A GREATER NUMBERS IN OUR DELEGATION LINING UP.

TED SIMONS: AS FAR AS INCREASED INVESTMENT, THE F-35 PROGRAM AT LUKE AIR FORCE BASE GETS AN INCREASE.

DENNIS HOFFMAN: THAT DOES. I DIDN'T SEE PRECISE NUMBERS ASSOCIATED WITH THAT 35 BUT IT WAS SINGLED OUT IN THE BUDGET NARRATIVE ALONG WITH THE EXTRA MONEY FOR THE DEPARTMENT OF DEFENSE. AND OF COURSE, YOU KNOW, SOME FOLKS ARE ARGUE THAT DEFENSE DIDN'T GET ENOUGH.

TED SIMONS: REAL QUICKLY, YOU MENTIONED THE BORDER WALL IN SOUTHERN ARIZONA. MONEY FOR THAT AS WELL IMPACTS ARIZONA?

DENNIS HOFFMAN: ABSOLUTELY. THERE WILL BE CONSTRUCTION AND EVEN SOME NOTION THERE IS LOCAL FIRMS THAT MIGHT BID ON SOME OF THAT BUSINESS. BUT I THINK WE HAVE TO STEP BACK AND SAY IF WE ARE GOING TO INVEST IN INFRASTRUCTURE ARE WE BETTER OFF WITH A BORDER WALL, I-11, SCIENCE BUILDINGS?

TED SIMONS: TEMPE TROLLEY?

DENNIS HOFFMAN: TEMPE TROLLEY, THERE IS A GOOD ONE. THAT ONE IS UNDER THE WIRE BECAUSE IT IS OUT OF THE 17 BUDGET NOT THE 18.

TED SIMONS: I KNOW THEY ARE WAITING FOR $25 MILLION MORE.

DENNIS HOFFMAN: MAYBE THAT IS NEXT YEAR. I DON'T KNOW. I KNOW THERE WERE DOLLARS ALLOCATED FOR THIS YEAR.

TED SIMONS: AS LAST QUESTION, I THINK PEOPLE FORGET THE IMPACT OF FEDERAL SPENDING IN ARIZONA.

DENNIS HOFFMAN: WELL, TED, IT IS HUGE. IT IS A POINT I KEEP TRYING TO MAKE. IF YOU ADD UP MEDICAID ON THE ORDER OF $11 BILLION A YEAR ALL IN THEN YOU HAVE GOT MEDICARE, NUMBERS APPROACHING THAT, YOU HAVE GOT PROCUREMENT FOR DEPARTMENT OF DEFENSE, ANOTHER $12 BILLION. YOU KNOW? THIS IS VERY MUCH THE CASE THAT IN ARIZONA WE GET BACK ABOUT $1.65 FOR EVERY DOLLAR WE SEND TO WASHINGTON AND HUGE NUMBERS OF PRIVATE SECTOR JOBS DEPEND UPON THESE DOLLARS. IT WILL BE VERY INTERESTING TO SEE AS THESE PROGRAMS COME FORWARD AND REAL CUTS TAKE PLACE JOBS ARE IMPACTED, IT IS GOING TO BE INTERESTING TO SEE WHAT PUBLIC SENTIMENT DOES.

TED SIMONS: AND PUBLIC SENTIMENT AND THAT CONGRESSIONAL DELEGATION. YOU HEAR FROM PEOPLE SAYING I AGREE WITH THE BUDGET BUT DON'T TOUCH XYZ IN MY DISTRICT. IS THAT STANDARD HERE?

DENNIS HOFFMAN: I THINK IT WILL BE WHEN PEOPLE COME TO THE REALIZATION OF WHERE THOSE DOLLARS THAT SUPPORT THOSE PROGRAMS THAT THEY REALLY LIKE, WHERE THOSE DOLLARS COME FROM.

TED SIMONS: THANKS FOR JOINING US.

DENNIS HOFFMAN: THANKS, TED.

TED SIMONS: COMING UP NEXT ON ARIZONA "HORIZON," A LOOK AT JUST A FEW OF THE NEW HUNDREDS OF STATES LAWS SET TO TAKE EFFECT.

Dennis Hoffman, ASU Economist

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