Taxes & Spending

New Bush Budget Does Little to Slow Spending Binge

In the days after the release of President Bush’s budget for fiscal 2007, liberal special interests and the Bush Administration will have something in common: both will claim that it outlines deep cuts in spending. Don’t believe it.

The budget for fiscal 2007 (which will be begin October 1) proposes aggregate federal spending that is 49% higher than in 2001 (the last Clinton budget). This rampant spending growth during the Bush years is the cause of our current large federal budget deficits (which had been vanquished in the late 1990s). The President’s budget projects a deficit in 2007 of $354 billion. If Bush and the Republican Congress had merely held federal spending growth to 4% annually since 2001, the President would instead be projecting a surplus of $58 billion.

In his "Budget Message," Bush writes, "Last year, I proposed to hold overall discretionary spending growth below the rate of inflation — and Congress delivered on that goal." The President’s own budget numbers reveal this claim as false. Total discretionary outlays for fiscal 2005 were $968.5 billion, and in 2006, they are projected to be $1,032.1 billion; an increase of 6.6% (far higher than the rate of inflation).

For several years, the administration has been trying to focus attention on the budget numbers for non-defense/non-security discretionary spending. This is relatively meaningless, since spending on defense, mandatory programs (Medicare, Social Security, farm subsidies, etc.), and homeland security accounts for about 83% of federal spending. Restraint in just a tiny portion (17%) of the federal budget — even if the claims were true — is hardly an accomplishment.

But the budget numbers reveal that there has been great spending growth all over the federal government. For instance, under Bush’s budget, federal education spending will be $64.5 billion in 2007. Expect Congress to enlarge this number, but even if they just enact what the President has proposed, it will mean that federal education outlays will have grown faster since 2001 (up 81%) than defense (up 74%). Other low priority departments (many of which should be abolished) will also be much larger in 2007 than in 2001 (Agriculture: 36%, Commerce: 32%, Housing and Urban Development: 32%, Labor: 34%).

Large increases in non-defense discretionary spending, the disastrous Medicare prescription drug bill, and to date a failure to reform Social Security have left the Bush Administration (and Republican Congress) with a terrible fiscal track record. The President’s new budget does little to turn this record around.

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