Union Tribune

February 4, 2003

Deficit-heavy plan arrives
President's $2.2 trillion budget has record amount of red ink

By TOBY ECKERT and OTTO KREISHER
COPLEY NEWS SERVICE

WASHINGTON President Bush proposed a $2.23 trillion budget yesterday that would increase spending on military and homeland security, speed up and expand tax cuts and begin a major overhaul of health programs for the elderly and poor.

Though the proposed budget for fiscal year 2004 came bound in blue, it contained a record amount of red ink. The budget projects a deficit of $307 billion for the fiscal year that begins Oct. 1, mounting to more than $1 trillion over the next five years.

In his budget message to Congress, Bush blamed the deficit on "a recession and a war we did not choose."

But Democrats seized on the deficits to question Bush's priorities, particularly the $670 billion tax-cut package he says is necessary to stimulate the economy.

"Today's budget confirms that President Bush is leading the most fiscally irresponsible administration in history," said Senate Minority Leader Tom Daschle, D-S.D.

"President Bush inherited a $5.6 trillion projected surplus. When the cost of the president's latest proposals is added to his already failed fiscal framework, the entire surplus disappears and we will be forced to borrow $1.7 trillion."

Battle lines were also drawn over Bush's $400 billion, 10-year plan to overhaul Medicare, including the creation of a prescription drug benefit, and the president's proposal to give states more authority to shape benefits under Medicaid, which funds health care for the poor.

While many domestic programs would be increased, others would be cut. Bush is seeking a variety of cuts, from reductions in Justice Department programs on juvenile delinquency and tribal courts to a halt in funds for the hiring of new police officers.

After-school and vocational education programs would be cut, though overall education spending gets a healthy increase.

Illustrating the difficulty Bush might have in moving his plan through Congress is the fact that lawmakers have yet to complete a budget for the current fiscal year.

The administration's hand was strengthened when the Republicans took control of the Senate, but the party maintains a narrow majority and some Republicans have questioned Bush's tax cuts and spending priorities.

Mitch Daniels, White House budget director, challenged lawmakers who make a balanced budget their top priority to say "which of the president's priorities they would not do or would do much less of."

He made no apologies for the expansive budget.

"This is a president of big projects and big ideas," Daniels said.

Bush noted that overall discretionary spending the portion of the budget that does not include mandatory spending programs such as Social Security would grow by about 4 percent in his plan, "about as much as family income is expected to grow."

"It seems like a reasonable benchmark for our federal budget," he said. "Within that limit, we can fund the central priorities at home and abroad and meet the responsibility to show spending discipline in Washington, D.C."

Continuing a trend that began after the terrorist attacks on Sept. 11, 2001, defense and homeland security represent a big chunk of that growth, even though the cost of a war with Iraq was not factored in.

Defense spending would reach $399.1 billion a 4 percent increase and a level not seen since the defense buildup under President Reagan in the 1980s.

Dov Zakheim, the Defense Department comptroller, said the budget was the first to fully reflect Bush's effort to prepare the U.S. military for the different threats of the 21st century.

Its stated priorities are winning the war on terrorism, sustaining high-quality personnel and transforming the military.

The Navy would get the first significant increase in shipbuilding funds in a decade. The nearly $3 billion increase, to $12.2 billion, would buy seven ships, convert four ballistic missile submarines to conventional land-attack vessels and begin development of a radically new aircraft carrier.

The budget also seeks $9.1 billion for missile defense, a $1.5 billion increase that includes funding for deployment of the first rudimentary national missile defense system to be based in Alaska and California.

But critics noted that the budget continues funding for a host of major weapons that were conceived in the Cold War. That includes purchase of the Air Force's F/A-22 Raptor fighter, the Navy's F/A-18 Super Hornet, the Marine Corps' MV-22 Osprey and development of the multiservice Joint Strike Fighter.

Pay raises would range from 2 percent for the newest personnel to 6.3 percent for midcareer enlisted personnel and officers.

Spending by the Department of Homeland Security would total about $36 billion, a 7.4 percent increase. That includes $12 billion for nonsecurity functions performed by some of the department's component agencies, like the Coast Guard.

The funding includes $18.1 billion for border, transportation and port security; $5.9 billion to coordinate emergency response efforts, including vaccine stockpiles; and $3.5 billion for training and equipping local "first responders," though officials acknowledged that some of that is aggregated from programs that existed in the past.

Many terrorism experts have questioned whether the administration is spending enough and Democrats echoed that criticism.

"The Bush budget fails to address glaring vulnerabilities in homeland security," said House Minority Leader Nancy Pelosi, D-San Francisco.

"It provides about $4 billion less than the amount that nonpartisan experts have identified as necessary to reduce the threat of terrorism at home and in our local communities."

Homeland Security Secretary Tom Ridge called Bush's spending proposal "an extraordinary commitment," but said "it's very appropriate for us to argue about the amount."

Other programs and agencies would fare unevenly. Education spending would increase by 5.6 percent, including gains for remedial education for poor children and grants to needy schools.

The Energy Department would get a 5.9 percent increase, including $591 million for moving ahead with the development of a nuclear waste dump at Yucca Mountain in Nevada.

Funding for NASA, in the spotlight after the space shuttle Columbia disaster, would grow 3.1 percent. That includes a nearly 25 percent increase in spending on the shuttle program.

Other agencies would see little or no growth in discretionary spending. Examples include the Agriculture Department, down 0.2 percent; the Environmental Protection Agency, up 0.1 percent; and the Department of Housing and Urban Development, up 1.3 percent.