Everyone in Congress except the pages - committed to silence on all things political - appears eager to blast Enron for accounting irregularities that obscured the real financial condition of that company.
But as lawmakers start deliberations on next year's budget, they're cribbing from many of the same recipes that Enron used to cook the books: hiding obligations and overstating revenues.
It's no secret, and it's not new. For decades, critics on and off Capitol Hill have complained about accounting devices that ignore long-term liabilities, such as Social Security and Medicare, while inflating current revenues. They have also blown whistles (often to no avail) at the habit of labeling as "emergency" anything from valid issues, like relief from earthquakes, to more-questionable ones, like the decennial census. (An emergency label exempts spending from budget rules.)
In its first year, the Bush administration reined in many efforts to use the emergency designation to get around budget constraints. But this year, as the administration confronts a financial landscape drastically altered by Sept. 11 and recession, critics say the new budget proposal uses creative accounting to hide hundreds of billions in costs. Lawmakers, furthermore, are likely to press for gimmicks of their own to obscure the cost of pet spending projects.
"By omitting or understating various costs and understating the ultimate costs of the tax cuts, the administration presents a much rosier picture than is warranted," says Robert Greenstein of the Center on Budget and Policy Priorities, a public-interest group in Washington.
Granted, nobody is accusing the federal government of the same kind of malfeasance swirling around now-bankrupt Enron - or predicting a federal filing of Chapter 11. Rather, critics on and off Capitol Hill are complaining about common and well-known accounting tricks that have become part of the political apparatus.
Indeed, over the years, there hasn't been any lack of high-profile efforts to reform the process. A 1974 law required Congress to set annual budget targets and make adjustments when spending went beyond them. In 1985, members of Congress voted for automatic spending cuts when deficit targets were missed, and it imposed new rules to curb deficits again in 1990 and 1997.
In the end, lawmakers often made ends meet (or not) by questionable accounting. "Each set of budgetary enforcement mechanisms breeds a whole new group of gimmicks to get around them," says Robert Bixby of the Washington-based Concord Coalition, a budget watchdog group.
Such budgeting habits have a long history, no matter which party has controlled the process. Here are some of the ways Washington works the numbers:
Count revenues that won't materialize. There are temporary tax cuts that are renewed year after year. Lobbyists call them "cash cows" for politicians to angle for campaign contributions. Budget watchers call them gimmicks that vastly overstate federal resources - and allow lawmakers a bigger official revenue pool to spend from. This year's big omission: reforming the alternative minimum tax.
If current trends continue, 39 million taxpayers will be subject to the AMT by 2012, up from 1.4 million in 2001. That's politically inconceivable, say lawmakers on both sides. And fixing the problem will cost "several hundred billion dollars over the next 10 years," says the Center on Budget and Policy priorities. It's a cost the budget leaves out.
And when you factor in the costs of extending other popular "temporary" cuts, which have been renewed year after year by the Congress, the cost tops $1 trillion, says Mr. Greenstein.
Understate future liabilities. Experts worry that Washington is not adequately preparing to pay the costs of Social Security and Medicare for retiring baby boomers. The federal government is collecting payroll-tax revenues, in theory, to prefund retirement benefits. But it's not saving the money. When budgets are in surplus, some of that money is used to pay down the debt; however, the president's budget anticipates deficits through 2004. That means those payroll dollars will be spent on other programs.
"It's a deceptive practice, because we're charging higher payroll taxes now and pretending to save, but all we're really doing is promising that some future taxpayers will have to pay higher taxes," says Mr. Bixby of the Concord Coalition. "The revenues we are collecting in advance of that show up now, making the budget look better than it should over the short term and hiding the big costs that come out after the next 10 years."