- The Washington Times - Monday, February 4, 2008

WASHINGTON — President Bushs new $3.1 trillion budget calls for the eleventh straight funding increase for the Pentagon, anticipates soaring federal deficits and virtually freezes domestic spending.

Slowing corporate tax revenues are the biggest reason for the deficit’s projected growth from $162 billion in fiscal 2007 to $410 billion in fiscal 2008.

Other contributing factors to the growing deficit, which is forecast to be at $407 billion in fiscal 2009, include the $146 billion economic stimulus package currently being debated in the Senate, and spending for Iraq and Afghanistan.

Mr. Bush’s budget director, Jim Nussle, admitted that a sluggish economydoes pose some challenges with regards to the deficit, but said the White House believes the deficit increase will be temporary if taxes and spending remain low and the presidents tax cuts are made permanent.

However, the full cost of the two wars is not included in the budget request. The White House has requested only $70 billion for Iraq and Afghanistan, and will issue a second request for the full amount “once the specific needs of our troops are better known.”

That amount will likely be determined once U.S. commanders report back in March on their decision for future troop levels. If past precedent is any indicator, the amount will likely be around $100 billion.

The full Defense request is $515.4 billion, not including the $70 billion in war funding. The current budget includes $479.5 for the Pentagon and $189 billion in projected war costs, though only $87 billion in war funding has so far been disbursed.

The White House still maintains that the deficit will be eliminated by fiscal 2012, and that the presidents request would leave the country with a $48 billion surplus. But Mr. Bushs arithmetic came under heavy fire from both Democrats and Republicans on Capitol Hill.

Sen. Judd Gregg, the ranking Budget Committee Republican, from New Hampshire, said the White House was playing the usual games with their budget numbers, in a Bloomberg interview today.

There’s a lot of games, smoke, mirrors, incomplete numbers, basically there’s not much realism, Mr. Gregg said.

Democrats continued to rail against Mr. Bush for inheriting a $236 billion budget surplus from President Clinton and turning it into a $167 billion deficit.

House Majority Leader Steny H. Hoyer, Maryland Democrat, called the request “a continuation of failed policies that have created dangerous deficits and debt, while at the same time decreasing critical investments in our nation’s future.”

Mr. Bush’s request has little chance of being adopted by the Democratic-controlled Congress, since they can delay passage until after Mr. Bush leaves office.

However, the president today defended the budget, saying it protects America and it encourages economic growth, and calling the request innovative and balanced.

“Congress needs to pass it,” Mr. Bush said, speaking to reporters after meeting with his cabinet at the White House.

Mr. Bush said that his request keeps spending under control by holding non-defense, discretionary, or optional, spending to less than one percent growth. And he said it saves taxpayers $18 billion by eliminating 151 wasteful or bloated programs.

In his second term, Mr. Bush has attempted to reduce discretionary spending after it ballooned in his first year and remained high for all of his first term, outpacing the rate of nonmandatory spending under President Clinton, a Democrat.

Discretionary spending rose by 16.8 percent in 2001, by 6.2 percent in 2002, by 5.5 percent in 2003, and by 4.3 percent in 2004.

In 2005, growth was 2.2 percent, and in 2006, it hit an all-time low for the Bush presidency at 0.3 percent. Since then it has stayed low, rising by 1.5 percent in 2007 and 0.6 percent in 2008.

Mr. Bush also has tried to make spending a core Republican issue again, after he was maligned for expenditure levels and Republican lawmakers gained a reputation for stuffing appropriations bills with wasteful “pork-barrel” spending while they were in control of Congress.

Mr. Bush has taken a hard line on tax increases and last year successfully faced down the Democrat-controlled Congress over spending bills that were $22 billion higher than his requested budget.

The presidents request also seeks to cut more than $200 billion in mandatory spending over five years. About $178 billion of those cuts will be made in Medicare expenditures.

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