Bush unveils a 'can do' budget

The surplus gives him unusual leeway to push his agenda - without deep cuts.

George W. Bush to America: You can have it all.

Almost all, anyway. More federal funds for education, health, and conservation. Down payments on missile defense and Medicare reform. Payback of the national debt, at historic levels.

A tax cut, too - a big one.

President Bush's fiscal agenda, as outlined in his Tuesday speech to the nation and newly released budget, is not entirely expansionist, of course.

Some programs get squeezed so that others may prosper. Ten agencies are slated for outright cuts, including the Departments of Energy and Transportation.

But Mr. Bush is the first modern US president to take office in an era of huge surpluses. That means he can attempt to move the nation toward his priorities without having to propose deep cuts - the kind that in the past led Democrats to call the GOP "the party of pain."

"Compassionate conservatism" thus may be a product of a moment in time, as well as an attitude.

The numbers may not add up in the end. But for now it seems fitting that Bush's first budget was released during Mardi Gras. "Essentially, the president said, 'we're going to have a party,' " says Marshall Wittmann, senior analyst at the Hudson Institute.

The $1.96 trillion budget that Bush sent Congress yesterday vows to tame "explosive growth" in government, while simultaneously providing "reasonable spending increases to meet needs."

Overall, it calls for an increase of $26 billion in government spending in fiscal 2002 - a 4 percent growth rate. Out of the predicted $5.6 trillion in surpluses over the next 10 years, it allocates $1.6 trillion to tax cuts, $2.6 trillion to Social Security, and $1.4 trillion to a reserve for "additional needs."

Bush's presentation of his budget this week is his first real attempt to fit all of his campaign proposals into a cohesive framework and sell them, as a vision, to the American people. So far, according to some experts, he has differed from a traditional Republican approach in at least three ways: There is little hostile talk of limiting government; there is a marked reserve about handing money to the Pentagon; and there is open embrace of the Education Department and some other specific federal efforts that the Reagan-era GOP tried to eliminate.

Big defense-spending increases could come later, after the Bush team finishes its just-launched strategic review of the military. The cost of missile defense - a Bush priority - could balloon into hundreds of billions of dollars.

But for now, Bush appears to be "triangulating" as Bill Clinton did. That is, he's forging a path separate from both the opposition party and his own party's past.

During his Tuesday speech, "at several points this president showed he was willing to borrow heavily from the ideas of the New Democrat agenda," says Will Marshall, president of the Progressive Policy Institute, a New Democrat-oriented group.

For Bush, the central aim of this exercise may be to make his $1.6 trillion tax cut appear to be both prudent and modest. Thus the rhetorical positioning he used in his speech - in which he said some Democrats said he had gone too far, and some Republicans claimed he had not gone far enough - cleverly placed his own proposal at the middle of a debate.

The whole thing was an exercise in emphasizing the positive, and mumbling about the negative, says Robert Bixby, executive director of the Concord Coalition, an organization that emphasizes government fiscal discipline.

"There was a lot of talk about programs he wants to increase, with some idea of vague cuts down the road," says Mr. Bixby. "It all strikes me as a bit of wishful thinking."

Bush officials insist their budget is, if anything, drawn up with conservative assumptions about economic growth and future government revenue. There are no accounting tricks that mask budget cuts or the real impact of the proposed tax cut, said Mitch Daniels, Office of Management and Budget director, at a briefing for reporters.

"You may search [for], but you will not find, 'magic asterisks,' " said Mr. Daniels, referring to a Reagan-era practice in which asterisks sometimes marked general budget-cuts-to-be-named-later.

But critics claim there is indeed smoke, if not exactly smoke and mirrors, in Bush's plan.

The $1.4 trillion reserve fund, for instance, doesn't really exist, claims Robert Greenstein, executive director of the Center on Budget and Policy Priorities.

He says it will be quickly eaten up by the real cost of the tax cut - which he says will be at least $2.2 trillion over 10 years - and other items uncovered in the budget, such as emergency flood payments to farmers.

"The reserve is gone before you even get to missile defense ... or increased defense budgets," he says.

Staff writers Francine Kiefer and Dante Chinni contributed to this report.

(c) Copyright 2001. The Christian Science Publishing Society

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