The President's Budget Falls Short

Today our nation is faced with enormous challenges. With the war in Iraq, the loss of millions of manufacturing jobs, the continuing rise in health care costs and exploding deficits, there are significant priorities that we must address. Sadly, the President’s budget proposal for the upcoming year once again puts cutting taxes for the wealthiest Americans over addressing our country’s severe fiscal problems.

Earlier this month, President Bush told the Detroit Economic Club that it was his job as President to confront problems, not to pass them on to future generations. But in his budget the President ignores his own job description and proposes a staggering $427 billion deficit for this year alone. This is a bill our children and their children will be forced to pay.

In many regards, what is most notable about the President’s budget is not what is in the plan, but what has been left out. To create the impression that the budget meets its target of cutting the deficit in half by 2009 and to conceal the damage it is doing to the nation’s fiscal outlook, the White House omits several major expenses. These omissions include the 30,000-person planned increase in the army, the cost of the wars in Iraq and Afghanistan, which currently average $5 billion per month, and the huge cost of the President’s plan to privatize Social Security. The budget also does not address the hundreds of billions of dollars it will cost to correct the Alternative Minimum Tax, which will otherwise result in a tax increase for middle-income taxpayers.

Moreover, by limiting itself to a five-year period instead of the usual ten-year projection, the budget grossly underestimates the cost to make permanent the tax cuts enacted in 2001 and 2003 as proposed by the President. The budget shows extending the tax cuts would cost $53 billion in the next five years. But hidden just beyond that budget window is the exploding cost of the President’s proposals, amounting to nearly $1.1 trillion after 2010. By using five-year projections instead of the customary 10-year numbers, the Administration attempts to hide from Congress and the American public the full economic impact of the tax cuts.

President Bush’s unwise tax cuts have been a major factor in our nation’s swing from budget surplus into an increasingly deep deficit ditch. At this rate, by 2015, each American’s share of the debt will be at least $30,000. To help pay for these fiscally irresponsible tax cuts, the White House proposes slashing essential domestic programs that affect America’s families and communities. For instance, the budget eliminates funding for 48 education programs, including vocational education training, education technology and programs to keep schools safe and drug-free. This represents the first cut in overall education spending in a decade and comes at a time when schools already face cuts in state education funding.

There is also little in the President’s budget to address devastating job losses, particularly in the manufacturing industry, even though our country is in the midst of the slowest jobs recovery since the 1930s. In fact, the budget imposes a 60 percent cut to the successful Manufacturing Extension Program -- which helps our country’s manufacturers be more productive and competitive, thus keeping jobs here at home – and it proposes eliminating the Advanced Technology Partnership Program, which provides assistance to U.S. businesses and joint research-and-development ventures.

Unfortunately, these are not the only programs hurt by this budget. The President’s proposal raises health care costs for America’s veterans. It proposes $4.5 billion in Medicaid cuts for the poor and disabled when health care costs are rising. The budget makes our streets less safe by cutting 96 percent of funding for the Community Oriented Policing Services program. The budget also cuts funding for first responders, highways and sewers, environmental protections and small business loans. The budget would end the successful Community Development Block Program, which provided over $147 million last year for housing projects and economic development, and puts in its place a new program with 21 percent less funding.

Yet even slashing spending on all these vital programs would have a small impact on the deficit compared with the President’s deficit-swelling tax cuts that significantly lower the nation’s revenue. Cutting spending on programs aimed at helping working families obtain an education or health care or a job, in order to extend massive and fiscally irresponsible tax cuts for the very wealthy, is the wrong priority. Using hide-and-seek accounting to mask the damage to our economy only compounds the problem.

The American people deserve a budget that invests in the future, protects the most vulnerable among us and helps to create jobs and economic security. This budget fails to meet that standard.