Big Bush Budget
by John Berthoud

At first blush, the President’s proposed budget for Fiscal Year 2007 looks quite restrained. Spending in many areas is either flat or cut: Department of Agriculture – down 3 percent, Department of Energy – down 1 percent, Department of Education – down by 23 percent!

The President is also proposing to make his tax relief permanent. That should be a no-brainer. The tax relief enacted during the first Bush term has helped the economy. And – contrary to the claims of the big-spenders – there is more than enough money in Washington to fund the needed business of government. This year’s federal revenues are projected to be 57 percent higher in real terms than they were just ten years ago.

That’s the good news in the President’s proposed budget. The bad news is that the spending cuts are relative to last year’s record-breaking spending levels. In any historical context, the Bush budget is still far too big.

The President’s budget for Fiscal Year 2007 (which will be begin October 1) proposes aggregate federal spending that is 49 percent higher than in 2001 (the last Clinton budget). While the President is calling for spending at the Department of Education to be reduced by 23 percent versus last year, it would still be 81 percent higher than in 2001. That’s a faster rate of growth than defense spending. And under Bush’s budget, the Department of Education will spend more in 2007 than it did in the entire second term of the Reagan Administration.

This rampant spending growth during the Bush years is the cause of our current large federal budget deficits (which had been vanquished in the late 1990s). The President’s budget projects a deficit in 2007 of $354 billion. If President Bush and the Republican Congress had merely held federal spending growth to 4 percent annually since 2001, the President would instead be projecting a surplus of $58 billion.

In his “Budget Message,” President Bush writes, “Last year, I proposed to hold overall discretionary spending growth below the rate of inflation – and Congress delivered on that goal.” The President’s own budget numbers reveal this claim as false. Total discretionary outlays for Fiscal Year 2005 were $968.5 billion, and in 2006, they are projected to be $1,032.1 billion; an increase of 6.6 percent (far higher than the rate of inflation).

Chastened by an angered base, Congressional Republicans will hopefully do the right thing on taxes and make all the Bush tax cuts permanent. And the Congressional GOP will hopefully not make the same mistake of past years when they have added substantially to Bush’s proposed spending levels (federal spending in 2006 will be approximately $141 billion higher than what Mr. Bush initially asked for). Congress should view the Bush spending numbers as a ceiling – not a floor. The federal budget has exploded during the Bush years. It’s time for Congress to take the lead – as it did in 1995 – and start bringing Washington down to a more appropriate size.

John Berthoud is President of the 350,000-member National Taxpayers Union & the National Taxpayers Union Foundation (www.ntu.org).

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