That portion of the discretionary budget that is not security-related will lose $21 billion over the next five years. It is being cut from $456 billion in FY 2008 to $435 billion in FY 2012, which is actually lower than FY 2006 actuals. This is despite a projected inflation rate of about 2% per year.

Much of this funding is being shifted to pay for mandatory benefits, such as Medicare, for the Baby Boom generation that begins retiring this year.

Find out how this will affect the U.S. economy in U.S. Federal Budget FY 2008 - Discretionary Spending