Bush budget builds defense, sparks fight over other cuts

WASHINGTON -- President Bush proposed a $2.13 trillion budget on Monday that pumps billions into the war on terrorism but challenges Congress by reining in resurgent deficits through cuts to job training, highways and scores of other programs.

Foreshadowing tactics sure to echo until November's elections for control of Congress, Democrats embraced Bush's national security plans. But they also blamed him and the ample tax cut he won last year for bringing back deficits and shortchanging domestic programs.

They complained that the budget would divert $1.5 trillion in Social Security and Medicare surpluses over the next decade to pay for other programs. In flusher times, lawmakers from both parties promised to use that money for debt reduction.

"The budget should promote long-term economic growth through fiscal responsibility, investments in people and technology and honoring our commitments to Social Security and Medicare," said House Minority Leader Dick Gephardt, D-Mo. "The administration's budget fails on all three counts."

The Democrats' criticism is just one reason Bush's blueprint will hit election-year trouble in Congress.

Conservative Republicans oppose letting deficits return on the GOP's watch. Party moderates may resist his proposed spending cuts in toxic waste cleanups, economic and urban development grants, and other programs.

Bush's spending plan for the budget year that begins Oct. 1 renews his call for tax cuts to bolster the economy, help lower-income Americans afford health insurance and reward corporate research. It seeks more money for biomedical research, schools in poor districts and park land maintenance.

Vital role of military

Right from its cover depicting a rippling Stars and Stripes, the spending plan makes clear its chief priorities of protecting Americans at home and pursuing enemies abroad.

"The budget I submit recognizes the vital role the military will play and recognizes we have only one alternative, and that is victory," Bush told cheering military personnel at Florida's Eglin Air Force Base.

Battling bioterrorists and other domestic security initiatives would double to nearly $38 billion. The Pentagon would get a $48 billion boost to $379 billion, including money for long-term contracts that will take years to spend. The figures include an overlapping $10 billion for Defense Department anti-terrorism activities.

Bush would use that defense increase -- the biggest since President Reagan's buildup two decades ago -- to raise military pay by 4.1 percent while buying more pilotless surveillance planes, stealth fighters and other weapons.

Last year's vision of uninterrupted annual surpluses has evaporated, thanks to the recession, the costs of fighting terrorism and the $1.35 trillion, 10-year tax cut Congress shipped Bush in the spring. Gone, too, are the president's year-old plans to retire $2 trillion in national debt by 2011.

Bush forecasts a $106 billion deficit this year and $80 billion in 2003; not until 2005 is black ink projected. Also, last year's projected $5.6 trillion in accumulated 10-year surpluses has shrunk to $1 trillion, assuming the president's tax and spending plans are enacted.

'What got Enron in trouble'

Democrats said even that dwindled surplus was inflated because of its reliance on Social Security and Medicare funds.

"It's fictional. That's exactly what got Enron in trouble," said Senate Budget Committee Chairman Kent Conrad, D-N.D., referring to the bankrupt energy company's accounting tricks.

But House Speaker Dennis Hastert, R-Ill., said the eroded surpluses justified "limiting growth in spending for those programs that are not as essential during these trying times."

Overall spending in 2003 would grow by $76 billion, or 3.7 percent, over this year's total. Projected revenue would increase by $102 billion, or 5.2 percent, to $2.05 trillion.

The president sets aside $190 billion over the decade to set up Medicare prescription drug benefits and overhaul the program. That is an amount lawmakers consider too low.

Less than inflation rate

More telling, however, is the one-third of the budget that Congress must approve each year and that excludes automatically paid benefits such as Social Security.

Overall, that category would grow by nearly 8 percent to $773 billion. But aside from the robust increases proposed for defense and domestic security, everything else -- from the space program to agriculture -- would get a cumulative 2 percent boost, less than the inflation rate.

Winners include the National Institutes of Health, whose $27 billion would culminate a bipartisan, five-year drive to double its budget.

One of Bush's highest-profile reductions is the $9 billion cut -- to $23 billion -- for highway building. Many lawmakers predict the money will be restored.

Twenty of the government's 48 job-training programs would be erased, including one to help migrant farm workers find jobs outside agriculture. Advanced technology grants to companies, one of former President Clinton's favorites, would be cut, as would funds for the National Oceanic and Atmospheric Administration and the U.S. Geological Survey.

Public housing, the space station, heating aid for the poor and the Forest Service also would be pared.

Among the proposals likeliest to be ignored are those to eliminate more than 1,000 education, science and health projects that lawmakers have won for their home districts. A similar Bush idea last year went nowhere.

Over the 10 years beginning 2003, Bush wants $591 billion in additional tax cuts, though most would occur at the decade's end with his plan to keep last year's tax cut from lapsing after 2010. Other tax cuts include rebates for low-income Americans to help revive the economy plus breaks for charitable giving, education and housing.