Wed, Feb 05, 2003 page5

• Bush gives his budget to Congress

  IT'S THE ECONOMY Even though hundreds of government programs will be squeezed, the deficit will still hit record highs this year and next year

  • AP
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  President George W. Bush sent Congress a US$2.23 trillion spending plan Monday that would accelerate tax cuts to bolster the weak US economy, overhaul some of the government's biggest social programs, give NASA a modest increase, shower billions of additional dollars on defense and homeland security. "We have moved to secure the nation's safety," Bush proclaimed.

  Even though hundreds of other government programs would be squeezed, the president projects the deficit will still hit record highs of US$304 billion this year and US$307 billion next year. Over the next five years, deficits would total US$1.08 trillion.

  

  Representative Jo Bonner, left, and Representative Jeb Hensarling, both members of the House Budget Committee, hold copies of the fiscal 2004 Budget on Capitol Hill on Monday.

  PHOTO: AP

  Bush's budget plan for fiscal 2004 that begins Oct. 1 will set off months of heated debate in Congress. Democrats attacked the tax cuts as a boon for the wealthy that will do little to help the economy but will rob Social Security of the money needed for baby boomers' retirements.

  "Instead of offering the nation a plan for long-term economic prosperity, the Bush budget burdens us, and our children, with trillions of dollars of new debt," said Sen. Kent Conrad.

  "His plan will push up interest rates, retard economic growth and create massive problems for the soon-to-be retiring baby boom generation," said Conrad, the Senate Budget Committee's top Democrat.

  In his budget documents, Bush blamed the deficits "on a recession and a war we did not choose."

  He said his budget would impose "spending discipline" through such efforts as reshaping the government's big health care programs, Medicare and Medicaid, along more conservative lines.

  "The budget for 2004 meets the challenges posed by three national priorities -- winning the war against terrorism, securing the homeland and generating long-term economic growth," Bush said in his budget message to Congress.

  Bush sent Congress a stack of books spelling out his proposal. The five separate document included one extra book this year analyzing the efficiency of hundreds of federal programs, part of a Bush management initiative.

  The budget, prepared before Saturday's Columbia space shuttle disaster, would give NASA a 3 percent increase to US$15.5 billion, including a 23.9 percent increase in spending on the shuttle, to US$3.97 billion. Current year shuttle spending, anticipated to total US$3.21 billion, represents a 1.9 percent cut from last year.

  In its management assessment of NASA, the administration said of the shuttle program: "Shuttle operations are well managed, but investments to improve the shuttle suffer from inadequate planning and poor cost management."

  White House budget director Mitch Daniels said it was too early to say what spending changes the president would recommend in light of the Columbia tragedy.

  "The president is committed to moving forward in space. He has made that plain. His budget makes that plain," Daniels told reporters at a budget briefing. "If there is a lesson in the last couple of days, I suppose it is another sad example that more money alone can't always avoid very sad setbacks."

  Bush's US$670 billion in tax cuts include eliminating the double taxation of stock dividends, plus making permanent his 2001 tax cuts that are now set to expire after 2010. Taken together, all the new tax cuts Bush is proposing would add up to US$1.3 trillion over the next decade, on top of the US$1.35 trillion tax reduction passed in 2001.

  The Pentagon's US$380 billion budget for next year reflects Defense Secretary Donald Rumsfeld's decision to shift spending priorities from improving today's weapons to developing tomorrow's.

  But if there is war against Iraq, the Pentagon will need ever more money. It has refused to disclose its early estimates of the likely cost of a war.

  For your information

  The best-laid plans

  * George W. Bush sent Congress a US$2.23 trillion spending plan Monday that would accelerate tax cuts. * The budget deficit in the US will still hit record highs of US$304 billion this year and US$307 billion next year. * The budget, prepared before Saturday's `Columbia' space shuttle disaster, would give NASA a 3 percent increase to US$15.5 billion, including a 23.9 percent increase in spending on the shuttle, to US$3.97 billion.
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