Unnecessarily bitter

Bitter Budget Medicine

By David S. Broder

Sunday, March 7, 2004; Page B07

The debate on the federal budget this year is taking place in an atmosphere far different from that of the earlier years of the Bush administration. It's almost as if the fiscal binge is over and legislators -- especially Republicans -- have sobered up.

In the first year after George W. Bush's election, amid the euphoria of promised budget surpluses as far as the eye could see, nothing mattered much to congressional Republicans but handing out whopping tax cuts to their constituents.

In 2002 and 2003, under the shock of the Sept. 11 terrorist attacks and the war in Iraq, along with a poky economy, the case for spending "whatever it takes" drove every other consideration from their minds.

It is only now, in year four, with another presidential election looming and the stark reality of a record deficit staring them in the face, that the members of the president's party are acting as if they have recognized the hole the country is in.

… Even more striking were the words -- and demeanor -- of Sen. Pete Domenici of New Mexico, the senior Republican on the Budget Committee for almost 22 years and its former chairman. In earlier Bush years, it was a matter of surprise and even dismay to budget hawks that Domenici countenanced and defended big tax cuts in the face of rising deficits.

Now clearly concerned, Domenici said that he believed the nation can work its way out of this jam -- but only if Congress again applies the enforceable budget limits that worked well in the 1990s. And specifically, he indicated his readiness to support "pay as you go" rules for future tax cuts, as well as spending proposals. That would mean that any tax breaks not on the books would have to be matched either by spending cuts or alternative revenue-raisers.

Bush, in his budget, would impose "pay as you go" rules on spending but not on tax cuts, tilting the table in the direction of his favorite pastime, reducing the taxes his patrons have to pay.

But the only way out of this jam -- the only way to prepare for the staggering retirement and health care costs of the soon-to-retire baby boomers -- is if tax cuts and spending are both brought back into line.

Posted by Prometheus 6 on March 7, 2004 - 8:12am :: Economics