- The Washington Times - Monday, September 3, 2001

Senate Democrats are gearing up for a "monumental battle" with the White House over the fiscal 2002 budget and are urging President Bush to hold a budget summit to re-examine proposed spending levels they say cannot be funded without raiding Social Security.
"The first step is for the president to be prepared to say, 'We may have misjudged how much money was available'" for spending programs and for him to agree to revisit and rework the budget, Sen. John Kerry, Massachusetts Democrat, said yesterday on NBC's "Meet the Press."
If Mr. Bush doesn't do that, Mr. Kerry said, "We will have a major confrontation over the appropriations process … and we will have a monumental battle in a few weeks over the subject of education and the other [budget] priorities. … we're going to have a great deal of difficulty avoiding a train wreck."
Congress returns this week from its summer recess and soon will be taking up the 13 spending bills that must be passed every year to run the government. To date, the House has passed nine and the Senate has passed five.
But the two chambers have not resolved differences on any of the bills in conference, which would enable them to be sent to the president's desk. Neither the House nor Senate has taken up the defense and education bills, which are two of the largest. The president is seeking an $18.4 billion defense-spending increase and up to $17 billion more to reform education.
Democrats blame Mr. Bush's 10-year, $1.35 trillion tax cut passed earlier this year for forcing Congress to either sacrifice funding for important federal programs or use money from the Social Security surplus to help pay for them.
New projections last week from the nonpartisan Congressional Budget Office (CBO) indicate that $9 billion in Social Security funds will be used by the government this year because of a shrinking budget surplus. Democrats question how there can be additional spending in the next fiscal year, if Social Security is to be protected.
But the White House sees no need to overhaul the proposed fiscal 2002 budget, which would take effect Oct. 1. "The government's finances are in remarkably strong shape. It's the economy that's not, and that's the president's first concern … we have vastly more than enough money to meet the nation's needs. We're not talking about cutting spending for next year," Mitchell E. Daniels, Jr., director of the Office of Management and Budget, said yesterday on NBC.
He added that spending in the president's budget would rise more than $100 billion. "And we can do that," he said.
Asked where the administration will find a way to keep the budget balanced, Mr. Daniels said, "We are going to run gigantic surpluses as far as the eye can see."
Most of the estimated $153 billion surplus the CBO forecasts for the end of this fiscal year would be Social Security money. Even so, Mr. Daniels said yesterday, "It's still the plan to use the Social Security surplus for no purpose other than reducing the debt" in fiscal 2002.
Asked if that means the CBO was wrong when it said the administration is tapping into $9 billion in Social Security taxes this year, Mr. Daniels said, "We won't know for a little while. The same CBO report shows we will have protected the Social Security surplus for 2002. That's the president's first budget, and the one that the Congress will be debating come next week."
But Democrats don't buy the rosy picture painted by Mr. Daniels and other White House officials. Mr. Kerry said the budget director's remarks were "so divorced from reality and so wrong on the fundamental facts … that it really underscores the nature of the confrontation that's about to take place."
On CNN's "Late Edition," Sen. Byron L. Dorgan, North Dakota Democrat and a member of the Appropriations Committee, called for a "new budget summit" to examine a White House "budget scheme that does not add up" and a "budget surplus that evaporated."
"How does the president now fund the increases in spending he wants? He's the one that's talking about a very substantial increase in defense, he wants an increase in education. Where's that going to come from? It doesn't exist in the current budget full of fuzzy math," said Mr. Dorgan.
He and Mr. Kerry said a budget summit should be a meeting between the White House, top economists and congressional leaders. The goal, said Mr. Dorgan, would be to "put together a fiscal plan that really does add up finally."
No lawmakers who appeared on talk shows yesterday advocated seeking a repeal of the Bush tax cut. But Mr. Kerry said he believes Congress should explore the possibility of a trigger mechanism that would block the tax cut in future years, whenever a deficit occurs.
"You can't keep throwing away money or giving back money you don't have," the Massachusetts Democrat said on "Meet the Press."
House Minority Leader Richard A. Gephardt, Missouri Democrat, has made a similar recommendation. Mr. Gephardt also has said the president should submit a revised budget and surprised many when he said he could support one with across-the-board spending cuts as long as it means not having to dip into Social Security.
But Mr. Kerry said: "When you have a downturn in the economy, the last thing you do is raise taxes or cut spending. We shouldn't do either. We need to maintain a course that, hopefully, will stimulate the economy."
Toward that end, "you might even consider a capital gains tax cut," said Mr. Kerry.

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