The Era of Fiscal Responsibility is Over

By David Sirota and Christy Harvey and Judd Legum, The Progress Report. Posted February 2, 2004.

President Bush will present his 2005 budget today. From environment to community development, agriculture to energy, the new budget proposes cuts in important programs. According to the LA Times, "Bush will call for the elimination of 64 government programs and holding the growth of non-security-related federal spending to a mere 0.5 percent, according to congressional officials familiar with administration plans." At the same time, tricky accounting means the cost for the ongoing wars in Iraq and Afghanistan -- sure to bring a hefty price tag -- aren't included. Here's what to look for:

Medicare: It turns out the Medicare bill is going to cost a lot more than the White House previously let on, a fact the Administration knew months ago, but refused to acknowledge during the debate of the bill. According to the NYT, "Bush administration officials said Sunday that Congress had grossly underestimated the cost not only for prescription drug benefits, but also for private health insurance plans that would be offered to elderly people under the new Medicare law." When the legislation was passed in December, the price tag was put at "$395 billion in the decade from 2004 to 2013. On Thursday, the White House put the cost at $534 billion." That's over a third more than what Bush insisted was the upper limit.

Missile Defense: The Bush budget will include a request for $9.14 billion for a missile defense system, "nearly 20 percent above last year's $7.6 billion for the agency." This is a giant expense for a system which is untested and relies on unproven technology. Last year, the GAO issued a report advising against moving forward with the program, saying "the planned system contains components 'that have not been demonstrated as mature and ready.'" American Progress fellow Larry Korb last week released a blueprint to revise and strengthen defense spending -- one that contrasts sharply with the White House's plans.

AIDS Funding: In his last State of the Union, the President announced a bold new initiative to increase funding for HIV/AIDS by $15 billion over five years. However, the Administration requested only $2 billion in 2004. And in his 2005 budget, Bush will provide only "$2.7 billion for efforts to battle AIDS and other diseases in poor African and Caribbean countries."

Rural Education: Though the number has yet to be released, President Bush is "expected to propose cutting rural education." Sen. Max Baucus (D-MT), warns "President Bush's proposed budget will likely not include enough money for·rural states to meet the requirements of the No Child Left Behind education law."

Energy Funding: At a time when the U.S. is trying to ease dependence on foreign oil, the new budget actually will propose cutting money for energy and natural resources, slicing the energy budget by $100 million.

Aviation Safety: At the same time the Administration announced plans to triple the FAA's workload, it is proposing a budget that slashes $471 million from the FAA budget -- "a 16% cut in spending on air-traffic-control equipment and facilities."

Other Cuts: Bush aides have claimed this is an anti-terrorism budget. It turns out it's also an anti-environment one. According to AP, Bush is proposing slashing the budget for the environment by $2.4 billion. Other cuts to watch for: The new budget will propose cutting community development by from $15 billion in 2004 to $13.2 billion in 2005. And while lawmakersfrom both sides of the aisle have called for increased spending for highways and mass transit, up to $375 billion over the next six years, Bush is expected to propose spending only $251 billion.

Doing the Math

In what may be the most deceitful budget submission in memory, President Bush claims that the U.S. can continue operations in Iraq and Afghanistan, fund a trillion-dollar tax cut, increase spending on defense, homeland security and counterterrorism, and launch a manned mission to Mars, while cutting the $521 billion deficit in half over the next five years. And astoundingly, even these depressing deficit projections are wildly unrealistic. They rely on a grab bag of gimmickry and distortion that, taken together, dramatically underestimate the scope of America's fiscal crisis. A more sober budget projection reveals that, five years from now, the budget deficit will be $477 billion -- almost exactly what it is today. When President Bush took office, the non-partisan Congressional Budget Office (CBO) estimated that from 2002-2011 there would be a total surplus of $5 trillion. Now, over the same period, the country is projected to amass a $4.3 trillion deficit -- a total deterioration of $9.3 trillion. And a new poll shows this is on America's mind -- 88% of Americans now say the federal deficit is either a "very serious" or "somewhat serious" problem.

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