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Background: Spending Blueprint

February 3, 2003 at 12:00 AM EDT
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KWAME HOLMAN: Weighing in at thirteen- and-a-half pounds, copies of Pres. Bush’s 2004 budget arrived on Capitol Hill just after 8:00 this morning. While staffers in the House Budget Committee’s office unpacked them for immediate consumption by the public and media, the budget chairman himself, Jim Nussle, was snowed in back home in Iowa. So on behalf of congressional Republicans, Senate Budget Chairman Don Nickles this afternoon gave a solo assessment of the president’s budget.

SEN. DON NICKLES: I think the president has given us a good challenge to help grow the economy. He’s willing to take on some big challenges that in the past the Congress and previous administrations have said “let’s not mess with that.”

KWAME HOLMAN: The president’s budget plan would spend $2.23 trillion. It reflects a 4.2 percent increase in discretionary spending, leaving a projected deficit of $307 billion next year. Approximately half of $30 billion in new spending is devoted to the military, bringing the total defense budget to $378 billion. For domestic security, the president sets aside $41 billion, almost all of which will fund the newly created Department of Homeland Security. On taxes, the budget includes the administration’s $670 billion economic plan and a proposal to make the 2001 tax cut permanent. The combined cost would total $1.3 trillion. Kent Conrad, the top Democrat on the Senate Budget Committee, criticized that part of the president’s budget, calling it bankrupt.

SEN. KENT CONRAD: Let me just say my first reaction is this budget is stunning in its lack of fiscal responsibility. What the president is proposing will push us even deeper into deficit and debt right at the time we should be paying down debt.

KWAME HOLMAN: Nickles responded.

SEN. DON NICKLES: What really has caused the deficit is there’s been a very dramatic decline in revenues, and the reduction in revenues was not tax cuts, the reduction in revenues was the fact that the economy was soft. And we’ve got to solve that. We’ve got to figure out a way to get this economy growing, we’ve got to figure out a way to get the stock market growing, we’ve got to figure out a way to get equities and markets growing to make companies and individuals profitable.

KWAME HOLMAN: For Medicare, the president proposes spending $400 billion over the next decade, including adding a prescription drug benefit. And Medicaid: $12.7 billion is provided over seven years to states willing to undertake experimental reforms. In it’s section devoted to NASA- – prepared before this weekend’s accident– the administration proposed a 4.7 percent increase in spending on the shuttle next year to $3.97 billion. That would follow a 1.9 percent cut in the shuttle program for this year. Costs associated with a possible war with Iraq aren’t included in this budget. Nevertheless, with so much money targeted to the military, homeland defense, and tax cuts, Congress will have to struggle with reductions in other programs.