Bush Spells Out an Array of Cuts in His 1st Budget
Politics: The $1.96-trillion plan would trim hundreds of programs while boosting discretionary spending 4%. The outline sets sharp differences with Congress.
By ALISSA J. RUBIN, Times Staff Writer
WASHINGTON--President Bush unveiled a $1.96-trillion budget Monday that puts in sharp relief his deep differences with Congress over the appropriate level of domestic spending at a time of huge budget surpluses.
Bush's 2002 budget, its details divulged for the first time, makes room for the centerpiece of his program--a $1.6-trillion across-the-board tax cut--by holding down most domestic spending and allowing smaller increases than Democrats would like in programs such as Medicare.
In three hefty volumes, Bush detailed hundreds of cutbacks large and small in programs ranging from clean water to child care. He squeezed in some increases in areas such as education and crime prevention, including more money for the enforcement of gun laws.
"It's a budget that protects taxpayers, protects children, protects our surplus," Bush said. "It represents compassionate conservatism. It's a budget that sets priorities."
It is also a budget that will set the terms of a months-long pitched battle between competing visions of government's role in American life.
Congress has already made clear some of its differing priorities. The Senate last week trimmed Bush's tax cut by about 20% to $1.27 trillion over 10 years, and added billions of dollars for an array of domestic programs including education, agriculture and health care for the uninsured.
Democrats were quick Monday to accuse Bush of abandoning his promise of "compassionate conservatism" and for releasing his budget at the beginning of Congress' spring recess, when fewer dissenting voices are present on Capitol Hill.
South Carolina Rep. John M. Spratt Jr., the top Democrat on the House Budget Committee, said the Bush budget would cut child-care grants, funds to pediatric hospitals and a host of conservation and environmental programs.
"These are compassionate cuts?" Spratt asked.
Nor will Republicans fall in lock-step behind Bush. Many already found themselves at odds with the administration in last week's Senate budget debate.
"You've got a group that wants a big defense increase, you've got a big group that wants an agriculture increase, and a lot of people like pork," said William Niskanen, president of the Cato Institute, a libertarian think tank based in Washington. "Democrats can always pick off a sizable group for spending on one domestic priority or another."
According to the administration's budget, the surplus over the next 10 years will total $5.6 trillion. Bush would leave the $2.6 trillion generated by Social Security for debt reduction.
Bush would split the rest between a tax cut ($1.6 trillion) and a combination of debt service, a Medicare overhaul and a contingency fund.
National Debt Would Drop to $1.2 Trillion
The projected 2002 surplus of $231 billion ($50 billion smaller than this year's) would grow to $526 billion by 2011. That would enable a reduction in the publicly held national debt from $3.4 trillion as of last Oct. 1 to $1.2 trillion 10 years later.
The fiercest battles over Bush's budget are likely to be fought in the "discretionary" accounts--the roughly 30% of the budget that can be manipulated annually in the congressional appropriations process. This part of the budget is about evenly split between defense and domestic programs.
Bush would increase discretionary spending next year by 4%, or $26 billion. Defense would gain at least $14 billion. Contract renewals and a contingency fund would claim an additional $11 billion, leaving a net $1 billion for domestic programs. The president would achieve this with $20 billion worth of increases offset by $19 billion in cuts.
In particular, Bush would cut in half the dollars spent on congressional earmarks--the so-called pork-barrel programs that benefit particular congressional districts.
"Washington's known for its pork. This budget funds our needs without the fat," Bush said.
Missing from the budget is how much Bush will put into modernizing the nation's defense after he receives a Pentagon review of America's military needs next month. He is expected to ask for many billions more than the $14 billion already in the budget.
"He's going to have a hard time if the defense review comes up with a large positive increment for fiscal year 2002," said Robert Reischauer, president of the Urban Institute and a former Congressional Budget Office director. "Then he will be saying that defense spending is outside the regular budget process, and then a lot of other interest groups will say, 'How about us; what about our programs?' "
For now, that leaves Congress focused on the domestic side of the budget.
Over the last several years, Congress settled its inevitable end-of-year spending battles by pumping large sums of money into domestic programs. In 2001, those accounts increased 8.7% over the previous year--nearly three times as fast as inflation.
Here are some key budget details:
* Education: Although Bush has talked up his education proposals, the actual funding increases are relatively modest--about $2.5 billion, 5.9% overall. Bush would spend $1 billion more on Pell grants for low-income college students, increasing the maximum grant by $100 a year, to $3,850.
More Money for Reading Program
The budget would also triple funding for a reading program for elementary-school children, to $900 million a year, and boost local grants targeted at low-income students through the so-called Title I program by $459 million, to $9.1 billion per year.
But the budget also laid out a proposal sure to be controversial: It would consolidate teacher training and class-size reduction programs into one $2.6-billion aid program that states and local districts could use for the general purpose of "improving teacher quality."
Class-size reduction--in essence, hiring more teachers--in recent years had been a high priority of the Clinton administration.
Democrats were disappointed in the increases and the focus. Rep. George Miller of Martinez, the House's top Democrat on education, said: "President Bush's message on education has gone from a shout to a murmur. He will not be able to turn around failing schools with his anemic education budget."
* Welfare: The administration eliminated the nearly $2 billion that Congress had set aside for the states to cover the costs of providing temporary welfare assistance to needy families who might swell state rolls during a recession. However, the administration created some small programs, including a $67-million mentoring program for children whose parents are in prison.
* Environment: Bush trimmed budgets for a number of programs in the Department of Interior and the Environmental Protection Agency. For instance, the U.S. Geological Survey's national water quality assessment program will lose $20 million. The cut will reduce from 42 to 24 the number of watersheds and river basins nationwide that will be studied for contaminants, according to USGS Director Charles Groat.
But Bush also added dollars, primarily to maintain facilities at national parks and boost funding to increase energy exploration and extraction from public lands. For instance, the Bureau of Land Management would receive $15 million extra to fund surveys to find gas and oil reserves on public lands, increase the pace of leasing for coal-bed methane extraction and pay for the planning effort for future leasing in the Arctic National Wildlife Refuge.
Many of the EPA's clean-water programs were eliminated, with most of the cuts coming in projects earmarked by members of Congress.
* Transportation: Overall, transportation programs were funded at about the same level as this year. But as with other agencies, Bush shifted the money extensively among programs. For instance, the proposal freezes spending for urban mass transit but increases spending for highways.
A Big Raise for Truck Safety Programs
The largest proportional increase went to truck safety programs, which got a 40% boost--from $269 million to $400 million.
The truck safety funding would lay the groundwork to comply with a provision of the North American Free Trade Agreement that allows Mexican trucks meeting U.S. safety standards unrestricted access to American roads. The money would go toward deploying more inspectors at the border and construction of inspection facilities.
There was also a transportation increase of $13.5 million to upgrade tire and vehicle safety standards in response to legislation Congress passed last year in the aftermath of the Firestone case. And the president proposed to spend $145 million on a new program to make transportation more accessible for disabled people.
Times staff writers Nick Anderson, Edwin Chen, Robert L. Jackson, Jonathan Peterson, Elizabeth Shogren and Ricardo Alonso-Zaldivar contributed to this story.
A New Budget Direction
Here are some highlights of the $1.96-trillion budget submitted by President Bush for the 2002 fiscal year, which begins Oct. 1. Discretionary spending would grow 4%, far below this year's 8.7% increase.
Changing Course
Bush is trying to reverse some of the budget trends launched by former President Clinton. This chart contrasts Clinton's first budget (1994), his last budget (2001) and Bush's first budget (2002).
How the total budgets break down:
CLINTON BUSH 1994 2001 2002 Defense 19.3% 16.1% 16.3% Human resources* 59.5 64.7 65.8 Physical resources* 4.8 4.7 5.1 Interest payments 13.9 11.1 9.6 Other 2.5 3.3 3.2
Winners and Losers
Here are the three biggest winners and losers as measured by "discretionary" spending authority--that which Congress can adjust annually in its appropriations process.
(in billions of dollars)
2002 Change from 2001 Education $44.5 +11.5% Housing and Urban Development $30.4 +6.8 Health and Human Services $56.7 +5.2 Transportation $16.3 -11.6 Agriculture $17.9 -7.4 Commerce $4.8 -7.4
Source: Office of Management and Budget
Human resources are mostly benefit programs; physical resources are mostly construction programs.
The End of a Trend
President Bush's 2002 budget ends nine years of shrinking federal deficits or growing surpluses.
In billions of dollars
DEFICIT
1992: -$290
SURPLUS
2002: $231
Source: Office of Management and Budget
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