Bush's $2.7 Trillion Budget Favors Defense

[Soldier4Christ]

By MARTIN CRUTSINGER

WASHINGTON (AP) - President Bush is sending Congress a $2.7 trillion spending plan that provides big increases for the military and homeland security but squeezes many other government programs in an effort to get soaring deficits under control.

Bush hopes to use the election-year budget to get his domestic agenda back on track after a frustrating year in which Congress spurned his top domestic priority of overhauling Social Security in advance of the retirement of 78 million baby boomers.

The plan, for the budget year that begins next Oct. 1, seeks to address more immediate voter concerns about soaring energy and medical bills and worries about the loss of America's economic edge to global competitors such as China and India.

People lined up in the cold outside the Government Printing Office several blocks from the Capitol to buy the massive four-volume budget documents, this year wrapped in a green and beige cover.

Even before the documents were released, Democrats were attacking the plan's call for $36 billion in Medicare cuts over five years. Senate Minority Leader Harry Reid, D-Nev., said that Bush's budget was "filled with pages of giveaways to special interests and cuts to those who can least afford it."

Republicans countered that the president was being responsible by beginning the effort of restraining the spending in Medicare so that the program will be better able to deal with the looming retirement of 78 million baby boomers.

"We have to face up to the fiscal reality that this baby boom generation is going to retire soon and we need to do something about it," said Senate Budget Committee Chairman Judd Gregg, R-N.H.

In addition to the reductions in Medicare, Bush's budget also proposes imposing tight controls on the budgets of many government agencies outside the Defense and Homeland Security departments.

In all, Bush targets 141 programs for elimination or sharp reductions for savings of $14.5 billion next year.

The effort allows him to meet his pledge to cut the deficit in half by the end of his term in 2009, while still preserving his other major priority: making permanent his first-term tax cuts, which are due to expire at the end of 2010.

Conservative Republicans, who have urged the president to get tougher in dealing with the deficit, expressed pleasure with his efforts to slow the growth of Medicare spending by $36 billion over the next five years.

But Democrats said Bush was making very little progress in reducing budget deficits that have soared during his administration in large part, they contend, because of his huge tax cuts that primarily have benefited the wealthy.

Because of the huge deficits, the administration will be forced to ask Congress in coming weeks to raise the national debt limit, now at $8.18 trillion.

"The debt is exploding and the president isn't facing up to it," said Sen. Kent Conrad of North Dakota, the top Democrat on the Senate Budget Committee.

The administration has said the deficit for this year will top $400 billion, driven upward by the costs of the war in Iraq and rebuilding the hurricane-ravaged Gulf Coast.

It said last week it would submit a supplemental spending request for $18 billion for hurricane relief for the current budget year and ask Congress for $120 billion to pay for the wars in Iraq and Afghanistan for the rest of this year and into 2007.

The war spending is on top of a nearly 5 percent rise in the Pentagon budget to $439.3 billion for 2007. Bush's budget would also provide about a 5 percent increase in spending at Homeland Security, not counting hurricane-recovery costs.

To achieve the goal of halving the deficit by 2009, the administration again wants to put a squeeze on the one-sixth of the budget that funds the nonsecurity operations of government - everything from running the national parks to buying paper clips.

Even programs not targeted for elimination are subject to tight budgets including such previously favored agencies such as the National Institutes of Health.

Bush's proposed Medicare reductions are expected to draw determined opposition in Congress, which just approved a reduction of $4.7 billion in spending for Medicaid, less than half the amount sought by the administration. Medicaid is a joint state-federal program that provides health care for the poor.

The spending plan does contain some winners in the domestic arena.

Set for higher spending, as highlighted in Bush's State of the Union address, are programs to address soaring energy costs through development of alternative fuels, rising medical bills through expanded health savings accounts and global competition through a new "American Competitiveness Initiative."

That initiative would extend an expired business tax break for research and development, double the government's commitment to basic scientific research and train thousands of new science and math teachers.

Instead of pushing last year's Social Security overhaul proposal, the president is calling for creation of a bipartisan commission to study ways to deal with soaring spending for Social Security, Medicare and Medicaid.