Bush Budget is Riverboat Gamble that May Drown in Sea of Red Ink

Bush Budget is Riverboat Gamble that May Drown in Sea of Red Ink

Budget & Tax
Feb 3, 2003  | 3 min read

Washington, D.C. – The following is a written statement by Steve Ellis, Vice President of Programs at Taxpayers for Common Sense, a budget watchdog organization, in response to the President’s fiscal year 2004 budget request:

Under the cloud of growing federal deficits, President Bush’s $2.25 trillion FY04 budget request is wishful thinking. The Bush administration’s strategy for reducing our massive federal deficit is to simplistically assume that America can grow itself out of our budgetary woes. However, history teaches us that the only recipe for getting our fiscal house in order is to combine aggressive cuts in wasteful spending with stabilization of federal revenue.

The President has proposed many excellent cuts and spending reductions to wasteful programs in his budget. This is the old Potomac budget two-step: cut funding to politically popular programs and let Congress take the blame for the increased spending. Unless the President is willing to veto bloated spending bills, Congress is more likely to treat a 4% increase in federal spending as a floor than as a ceiling.

Despite all the President’s past rhetoric focusing on the importance of cutting spending and reducing the size of the government, since he took office in 2001 federal discretionary spending has increased by about 25%, from $634 billion to $782 billion this year.

With a sea of red ink stretching off into the horizon, this budget does nothing to prepare the country for the economic burden of the baby boomers’ retirement. Before the end of this decade, the first baby boomers will retire and begin collecting Social Security and Medicare benefits. Over the next twenty-five years the rest of the boomers will retire, at which time providing retirement benefits will tax the economy and the federal budget enormously.

The Congressional Budget Office projected a $200 billion deficit in 2003 and the Office of Management and Budget released their projection of a $300 billion deficit. Some private economists are forecasting that this year these figures could skyrocket to more than $400 billion. Since the President took office, budget surplus figures have deteriorated by more than $5.6 trillion.

These projections don’t even take into consideration the $80 billion or more that our nation will likely spend this year to pay for a war in Iraq. Nor do they include the new tax cut, prescription drug benefit, or any of the other bacon the big spenders in Washington want. Contrary to the administration, large, persistent deficits do matter. Bigger debt has a corrosive impact on the economy’s ability to grow by driving up interest rates and crowding out private investment.

Unless the President comes up with a clear plan to confront this fiscal crisis, it’s guaranteed to be passed on to future Congresses, future Presidents, and future generations of American taxpayers.

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