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The numerical wizardry behind budget

Smoke and mirrors may make it hard to tell if the awaited budget will tap into Social Security funds.

By Ann Scott TysonSpecial correspondent of The Christian Science Monitor / October 25, 1999



WASHINGTON

Down a dull, gray corridor at the Congressional Budget Office is a modest row of cubicles under a plain brown sign. Welcome to Washington's version of ... Wonderland?

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The accounting wizards who toil here figure powerfully in the current dispute over how to spend - but not exceed - the $592 billion that is up for grabs in the fiscal 2000 budget. They take frenzied proposals from the Republican-led Congress and President Clinton, and zap them into tidy spread sheets bearing bold, black totals.

Ultimately, this is the place that will answer the politically loaded question: Does the budget dip into the Social Security surplus?

But these number-crunchers live in two budgetary worlds: the real one, based on the CBO's generally respected economic projections, and the fake one, based on politicians' fantasies, a little like the bits of cake in "Alice in Wonderland" that magically make things shrink or grow.

It's not surprising, these days, that nerves are a bit frayed at the CBO's "scorekeeping unit," as workers deal with impatient politician-taskmasters.

"Tempers are short," says one anonymous scorekeeper, who has been working 12-hour days. "You have a lot of frustration."

A promise and a pressure cooker

CBO scorekeepers are under pressure largely because both Congress and the Clinton administration have boxed themselves in with a promise they really don't want to keep: to curtail spending in an era of budgetary surplus.

Negotiations over spending priorities are expected to intensify this week with the approach of an Oct. 28 deadline to finish the 13 annual bills that fund federal programs - or face another government shutdown.

So far, the president has signed seven of the bills and vetoed two others. Unresolved is a huge bill that includes about $90 billion in discretionary spending for labor, health, and education.

With the federal government enjoying its first surpluses since the 1960s, Mr. Clinton wants to spend more on his top priorities of law enforcement, education, foreign aid, and the environment. Congressional Republicans, too, have endorsed spending increases for defense and their own education initiatives.

But for largely political reasons, both sides have vowed to stop a decades-old practice of spending that part of the surplus - now the bulk of it - that is generated by Social Security payroll taxes. That means holding fiscal 2000 discretionary spending to about $592 billion.

To stay within this limit while still boosting funding for their priorities, Clinton proposed raising billions with new cigarette taxes and other revenues - a nonstarter with Republicans, who staged a House vote earlier this month that overwhelmingly rejected the tax hikes.

Republicans, for their part, are pushing an across-the-board, 1.4 percent budget cut that they say would save about $4.5 billion in "waste, fraud, and abuse." Yet Democrats and the White House have balked at the cuts, saying they would indiscriminately hit both efficient and wasteful programs.

Failing tax increases or an across-the-board cut, how will Congress and the White House raise spending while sticking to the budget limit? The answer, as the CBO scorekeeping unit well knows, is simple: Camouflage billions' worth of funding with accounting gimmicks.

Pointing to a line on the latest budget status report labeled "scoring adjustments" - a growing figure that now stands at $19 billion - one CBO analyst struggles to define the accounting trickery in the most diplomatic terms possible.