President Bush on Monday unveiled a $2.13 trillion budget for 2003 that makes fighting terrorism and reviving the economy top priorities while slashing hundreds of initiatives approved by Congress to pay for his own sweeping domestic agenda.
“By curtailing unsuccessful programs and moderating the growth of spending in the rest of government, we can well afford to fight terrorism,” Bush told Congress in his budget request.
The first federal budget influenced by the Sept. 11 terrorist attacks seeks a $48 billion increase in defense spending, the largest surge since President Ronald Reagan’s military buildup in the 1980s, and $38 billion to protect the homeland. It also reintroduces a package of business tax breaks and new federal spending intended to pull the economy from a recession.
Bush’s budget holds the growth of all non-defense spending to 2 percent by eliminating scores of programs and projects that leading lawmakers have inserted over the years to benefit their districts and states.
The budget projects an $80 billion deficit in the 2003 fiscal year beginning Oct. 1. The White House said $77 billion of that shortfall is due to Bush’s call for a mix of tax cuts and new spending to spark the economy.
The first spending plan Bush has crafted from scratch is so expansive in its reshuffling of spending priorities that it provoked concerns from the political right and left hours after its release.
Lawmakers remained fully supportive of the war Bush is leading against terrorism. But they were just as emphatic about their opposition to a host of other administration priorities, especially the economic stimulus package previously rejected by the Democratic-controlled Senate and which some Republicans complain is the primary reason the 2003 budget proposal includes the first deficit in five years.
`Congress always rewrites’
“It’s important to remember that this is a proposal,” said Sen. Charles Grassley of Iowa, ranking Republican on the Senate Finance Committee. “Congress always rewrites the president’s budget proposal.”
The attacks of Sept. 11 are felt throughout Bush’s budget plan. Virtually every department’s budget was scrambled to help pay its share of homeland defense next year.
The Pentagon’s budget would grow by 14.5 percent. Military personnel would get a 4.1 percent pay raise next year, while other federal workers would have to settle for 2.6 percent.
For some agencies, the changes wrought by the war against terrorism, and made evident in Bush’s spending plan, were much more profound.
The proposed increase in funding for the Justice Department is less dramatic than its new direction for spending nearly $30 billion. Instead of making grants to state and local police to fight domestic crime, the department’s budget would include $734million for border security and $13 million for courthouse protection.
Bush’s spending plan also advances a variety of domestic programs, from health care to literacy, considered critical to Republican hopes in this fall’s congressional elections.
Drug plan for the elderly
He proposed creating a prescription drug plan for the elderly as part of a reformed Medicare program at a cost of $190million over 10 years and allowing uninsured workers to write off up to 90 percent of their medical expenses, at a cost of $89 million over 10 years.
With Congress facing the need to reauthorize the welfare reforms first approved in 1996, Bush has advocated extending food stamp benefits to legal immigrants, a benefit they lost during the program’s overhaul.
Bush reached out to conservatives angered over his abandonment of a voucher program in last year’s education reform bill with a provision that would give a tax break to parents who move their children out of troubled public schools.
Though the Bush political team believes conservatives are crucial to the party’s election chances this fall and Bush’s re-election bid in 2004, he bucked them in other crucial areas of the budget.
In a marked departure from Republican conservative orthodoxy, Bush plans to spend $25.4billion to aid foreign governments that have cooperated with the war on terrorism. That represents a 6 percent increase over this year’s budget.
Jordan, a key Arab ally and peace broker in the Middle East, would receive $250 million in economic assistance, an increase of 67 percent from last year, and $198 million in military assistance, a 160 percent increase.
Pakistan, which offered extensive cooperation in the operation to oust the Taliban and Al Qaeda from neighboring Afghanistan, would receive $200 million in economic assistance, up from $9.5 million last year.
At home, Bush proposes adding $12 million to the budget of the National Endowment for the Arts, a program conservatives have tried repeatedly to kill.
Fuel exploration in Alaska
One proposal expected to draw opposition from environmentalists is Bush’s continuing push for oil and gas exploration in Alaska’s Arctic National Wildlife Refuge.
While Bush’s budget was being unveiled in Washington with the usual fanfare and briefings by agency heads, the president was in Florida emphasizing the one element of the spending plan most likely to hold Democratic support: defense.
Congressional Democrats have made an effort to back Bush on the war, though they may challenge some of the items he wants to finance, such as the missile defense system.
Democrats and Republicans are more likely to challenge Bush over the hundreds of “earmarks” he intends to delete from the budgets of virtually every agency and department. Earmarks are a way for the most powerful lawmakers to insert into the budget some favorite program or project, from a new highway to a school program, without going through the normally complex budget process.
Cuts in road, health projects
But department by department, Bush proposed eliminating $9 billion for road projects and wiping out 20 of the 48 existing job-training programs and hundreds of health, education and science programs lawmakers had secured for their districts or states.
Bush’s budget director, Mitch Daniels, said Monday that earmarks have grown exponentially over the past five years, to the point that they are draining money from other critical federal programs.
“We’re not extreme about this,” Daniels said. “We do believe that Congress ought to moderate its appetite for these programs.”
Bush’s spending plan quickly set off alarms, not just among congressional Democrats but also with some Republicans, virtually guaranteeing a contentious battle on Capitol Hill.
Democrats assailed Bush’s plan to cut corporate taxes. Rather than stimulate job growth, as Bush claims, the tax breaks, combined with Bush’s $1.3 trillion, 10-year tax-cut package approved last year, would drain $2 trillion out of Social Security and Medicare trust funds over the next decade, Democrats contend.
“This budget is disappointing on a grand scale,” said Rep. Pete Stark (D-Calif.). “Should the president’s failed economic policies continue to be implemented, we will suffer the consequences for years and years to come.”
White House isn’t moved
Daniels dismissed Democratic attacks on the tax cuts.
“By now its opponents have blamed the tax cut for everything except mad cow disease,” Daniels said.
Some Republicans, meanwhile, have pressed the White House to reduce its own spending. In the competitive election year that lies ahead, Rep. Tom DeLay (R-Texas) and other conservatives in the party are quietly questioning the wisdom of the stimulus package which, if deleted from Bush’s proposal would virtually wipe out the 2003 deficit projection.
A top GOP strategist on Capitol Hill said Bush’s plan could sink the Republicans at the polls.
“President Bush has the latitude and the popularity to get away with not balancing the budget, but other Republicans will have trouble defending it,” the strategist said. “What the House can get away with and what the White House can get away with are different things. We have to balance our budget.”
Bush, a pragmatic dealmaker willing to work with Democrats to salvage his initiatives, has been reluctant to threaten a veto. But Daniels said the president would resist all attempts to reduce spending on the war and homeland defense below his requested levels and to raise non-defense spending by more than 2 percent.
“The president is always careful not to talk about the `V’ word unless he has to,” Daniels said. “It may well come to that this year.”
