Millennial Budget Busting

Despite bipartisan promises to protect the Social Security surplus, the fiscal 2000 budget will have to borrow $17 billion in Social Security revenue to pay for other programs, according to a new report.

The report by the Congressional Budget Office (CBO) contradicts widely publicized claims by Congressional leaders and President Clinton that the budget would adhere to the spending limits of the 1997 balanced budget deal and end the practice of using Social Security surpluses to help fund the government's day-to-day operations.

The balanced budget agreement was passed three years ago while the government still had massive deficits. But a raging economy and tremendous gains in the stock market have helped to usher in a new era of economic prosperity.

The balanced budget agreement allowed Congress to spend $579.8 billion in fiscal 2000. Yet, Congress and the administration last fall negotiated an agreement to spend $617.2 billion — $37.3 billion above the spending caps.

Despite their denials, Congressional leaders and the White House have used a record amount of budgetary gimmicks to circumvent the spending restraints of the 1997 budget deal including declaring the 2000 census an “emergency.” Since they used these gimmicks to push the costs from fiscal 2000 over to next year, Congress must fill an $11.4 billion hole in the fiscal 2001 budget.

To abide by the caps next year, Congress would have to cut $15 billion in spending, despite the efforts of many to increase government spending, especially for the military. Instead of cutting the billions of wasteful spending in the federal budget, many Members of Congress support the passage of a budget resolution that would break the caps.

CBO officials also acknowledge that the booming economy will improve the budget picture and reduce the drain on Social Security by the time their projections are revised later in January.

Passing the fiscal 2001 budget will be a Herculean task because of a shortened legislative session; Congress should still adhere to the 1997 balanced budget deal. Otherwise, the projected surplus both parties are counting on will turn into a deficit the following year, when a new Congress and President take office.