From Deseret News archives:

Bush budget austere but will still increase red ink

48 school programs and 150 government programs face knife

Published: Monday, Feb. 7, 2005 9:30 p.m. MST
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"We have investments we need to be making," said White House budget office spokesman Chad Kolton, referring to Bush's proposed military boost and other proposals. "Even so, we are significantly reducing the growth of spending" and moving toward halving the deficit.

Bush's package faced an uncertain fate in Congress, where conservatives seemed ready to demand deeper deficit reduction and Democrats — and some Republicans — were sure to resist its spending cuts.

Underscoring the jostling that lawmakers were preparing for, House Speaker Dennis Hastert, R-Ill., lauded the plan as "a blueprint to fund our nation's priorities" but called it "a good starting point for the Congress to begin its work."

Democrats chided the package for its proposed cuts and because they said it obscured more serious deficit problems ahead. They complained it excludes next year's war costs and the price tags of Bush's Social Security overhaul and of keeping the alternative minimum tax from affecting more middle-income families.

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"Why is he playing this hide-and-seek game?" asked Sen. Kent Conrad of North Dakota, top Democrat on the Senate Budget Committee. "I believe it's because he really doesn't want people to know where he is headed."

Among other proposals that deficit hawks considered unrealistic were the budget's assumption that spending for non-security programs would remain level at $389 billion over the next five years.

Bush was expected to propose an $81 billion war package for the rest of 2005 in a few days. Congress has already approved $25 billion for the year.

Besides omitting the impact of revamping Social Security, Bush proposed no specific savings at all from Medicare, the health program for the elderly and disabled. The $340 billion-a-year program, though $200 billion smaller than Social Security, faces a long-term solvency problem whose solution is technically and politically more complicated because of the intricacies of health costs.

Bush was using some of his budget cuts to funnel billions to White House priorities.

Defense and domestic security would both see healthy growth, as would select education, public housing, space and other programs. He would also create tax breaks totaling $74 billion over the next decade to encourage low-income people to buy health insurance.

Even so, the budget provided ample evidence that deficits were limiting his agenda.

Bush's proposed 4.8 percent increase for the Pentagon would bring its budget next year to $419.3 billion, excluding Iraq war costs. Yet that was $3.4 billion less than he projected for 2006 just a year ago, with weapons procurement among the leading areas feeling the crunch.

He was seeking increases for perennial favorites like veterans health care, aid to low-income school districts, special education — but all dramatically less than he proposed last year.

Even his tax-cutting agenda was under the gun and had little new. Of the $1.4 trillion in 10-year tax cuts, more than $1.1 trillion was his oft-repeated call to make his 2001 and 2003 tax cuts permanent.

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