WHAT IS MEANING OF DEFICIT GAP FOR TEFLON GEORGE BUSH?

One of today's great untold stories is that President George Bush is engaged in an orgy of runaway spending. It's a fact that Mr. Bush is presiding over a spending explosion that exceeds every predecessor, even including the previous all-time champ, Lyndon Baines Johnson.

Economist Dr. Paul Craig Roberts served in the Reagan Treasury department for 18 months back in 1981 and '82. He now writes a newspaper column and is professor of political economy at the Center for Strategic and International Studies in Georgetown. He's one of the most perceptive economic writers around today, and he has some interesting comments on what he calls "George Bush's Teflon Deficits".

"This year's U.S. budget deficit is now approaching twice the size of Ronald Reagan's record, and no one has said a word. President Bush enjoys a remarkable immunity to the issue that so bedeviled `the teflon president.'

"In the 1980s, the budget deficit was consistently used to dull enthusiasm for the most successful U.S. expansion of the post-war period. Even within the government, high-ranking administration or Federal Reserve officials continually worried in public over the disastrous deficit.

"Federal Reserve Chairman Paul Volcker explained relentlessly that interest rates could not decline until the deficit did. Senior Reagan officials, such as budget director David Stockman and Council of Economic Advisers Chairman Martin Feldstein, helped to create an atmosphere of foreboding about the future that spawned a succession of best-selling books predicting cataclysmic depression. Media attention and talk shows turned the authors of these pessimistic books into instant gurus of economic doom.

"Peter Peterson, a former Republican Secretary of Commerce, sponsored a series of apocalyptic newspaper ads calling for action against the economy-destroying deficit. Hardly a week passed without an editorial in the New York Times and Washington Post imploring the country to save itself with higher taxes. When the federal budget deficit reached $221.2 billion in 1986, newspapers around the world declared Reaganomics a failure ...

"The Reagan deficits were the topic of a decade; yet, throughout the period they were offset by state and local government budget surpluses generated by the long expansion. The 1986 deficit, for example, was offset by $62.8 billion in state and local government surpluses. The total budget deficit for all levels of government that year was $158.4 billion, 3.7 percent of GNP.

"... When President Bush began in late 1989 to come under pressure to abandon his `no new taxes' pledge, the combined U.S. deficit had fallen to $107 billion, or 2 percent of GNP. Since the Bush tax increase and `deficit reduction package' there has not been another word about the deficit an extraordinary silence in view of the unprecedented increase in the combined deficit from 2 percent of GNP in 1989 to 6.4 percent in 1991.

"Over the past two years, the federal budget deficit has more than doubled, to $318 billion this year from $153 billion in 1989, and state and local budget deficits have shifted to an estimated $44 billion deficit from a $46 billion surplus. The U.S. as a whole now has a fiscal deficit almost twice as large as Reagan's record. Yet interest rates have collapsed, and the Bush administration and Wall Street are predicting recovery.

"Apparently there are two kinds of deficits. Reagan deficits deindustrialize America, force up interest rates, doom future generations and suck up the world's savings while preventing economic recovery. Bush deficits, however, cause hardly a ripple in the domestic or world economy. Or so it seems.

"The deafening silence that has greeted Mr. Bush's 6.4 percent deficit does suggest that the deficit hysteria of the 1980s was a ruse ... Now that Mr. Bush has returned to Washington's old routine of taxing, regulating and spending, the growth in the deficit is, evidently, just part of the process."

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Aileen Lorberg, our redoubtable language columnist, discusses educational funding and related issues in tomorrow's column. America's most widely syndicated columnist, Jack Kilpatrick, recently called his friend Miss Lorberg "one of America's leading word mavens" in a Writers Art piece he published nationwide. Here is an excerpt from Aileen's current column:

"... Say what you will about the disadvantages of parochial-school education, it's common knowledge that our Catholic schools have always ranked highest in the land. I re-discovered this every time I judged a writing contest, year after year. Top honors always went to Catholic-educated students."