Posted on 05/12/2002 12:31:56 AM PDT by JohnHuang2
ASHINGTON, May 11 — Congress and the Bush administration are heading toward further big increases in government spending, reflecting the costs of fighting terrorism, election-year support for domestic programs and the apparent lack of a political penalty for the reappearance of budget deficits.
Despite a commitment by President Bush to hold down the size and scope of government — and a brewing revolt among conservatives who say they are determined to resist further increases — spending grew substantially this year and is all but certain to be up sharply for years to come, private analysts and members of both parties said.
While Republicans generally support limited government, they are now pushing for the largest military buildup in 20 years, huge increases in spending on domestic security and many domestic programs like the farm bill, in addition to election-year pork-barrel spending.
The parties, however, remain sharply divided on spending for many social programs, with Democrats, as always, backing higher spending for education, the environment and health care programs like Medicare coverage for prescription drugs.
With revenues already depleted by the combination of the recession and the tax cut Mr. Bush pushed through Congress last year, the continued growth in spending will probably push the government deeper into deficit for at least the next few years, they said.
Although Republicans blame Democrats for pushing spending ever upward, members of both parties have supported many increases as vital or at least justifiable. The cumulative effect has been a multiyear spending surge that began when the budget surplus was large and has continued now that the government is back in the red.
"We're seeing very little, if any, discipline on the spending side," said L. Douglas Lee of Economics from Washington, a consulting firm. "Long-term projections still show surpluses in the future, but the assumptions underlying those projections are increasingly unrealistic. Large tax cuts combined with growing outlays threaten deficits as far as the eye can see."
The rise in spending is giving the economy a lift as it comes out of the recession, economists said. But they said that if left unchecked, the deficit growth could ultimately harm the economy.
Mr. Bush is seeking and is all but certain to get the biggest military spending increase in two decades, the centerpiece of a buildup that the two parties generally agree is justified by the threat of terrorism.
Spending is rising sharply in many other areas as well. Congress completed work this week on a bipartisan farm-aid bill that is expected to cost billions of dollars more over the next few years than projected even a few weeks ago.
In the next month or so the House will vote on a Republican plan to spend $350 billion over the next decade, nearly twice what the White House had sought, on overhauling Medicare and providing retirees with a prescription drug benefit. Democrats in the House and the Senate are considering a plan that could cost as much as $800 billion.
Next week the House Appropriations Committee is expected to approve a $29.35 billion supplemental spending bill for this year, $2 billion more than Mr. Bush sought. The Senate Appropriations Committee plans to take up its version of the measure soon and is expected to add billions of dollars more.
As Congress prepares to work on the spending bills for next year, the White House is already warning lawmakers not to let expenditures grow beyond what Mr. Bush has requested.
"From the first of the year, the president has been cautioning about the need not to practice a guns-and-butter policy," said Mitchell E. Daniels Jr., director of the White House Office of Management and Budget. "The president is resolute. The House leadership is resolute. Those are two good disc brakes. The problem is that the vehicle is already moving pretty fast."
Many of the formal and informal constraints on spending have been tossed aside by choice or circumstance, including budget rules that set spending limits and the bipartisan agreement not to dip into the Social Security surplus.
Democrats have not been able to get a budget plan through the Senate this year, meaning Congress may have to take up the annual spending bills without a blueprint for how much money should be allocated to domestic and military programs.
Efforts by the administration to push through spending cuts in some areas to offset increases in others have brought the White House nothing but political heartburn.
Last week the administration effectively abandoned a proposal to slim down the federal student loan program after an outcry from Democrats and Republicans. In considering the supplemental spending bill, the House Appropriations Committee provided much of the financing sought by the Energy Department for increased nuclear security even after Mr. Daniels slashed the request.
After a year in which Mr. Daniels infuriated appropriators from both parties by suggesting that they had never met a spending proposal they would not embrace, the House appropriations panel did rally around one budget cut: a reduction of $750,000 in the $78 million annual budget for Mr. Daniels's own agency.
Depending on how big a supplemental spending bill Congress approves, discretionary spending — the programs Congress has to vote on each year — will probably total $720 billion to $740 billion this year, up from $657.4 billion last year. Mr. Bush's budget calls for an increase in discretionary outlays next year to $773 billion.
Those figures do not include the costs of mandatory programs, those that are not revisited each year, including farm subsidies, Medicare and Social Security.
Democrats do not want to be tagged as big spenders and risk their claim, a legacy of Bill Clinton's presidency, to being the party of surpluses and fiscal responsibility.
But they do not want to surrender over spending programs, contending that the tax cut is the root of the fiscal problems, not increased spending. They admit, though, that they lack the votes to delay or repeal the tax cut, which phases in over the rest of the decade.
Representative David R. Obey of Wisconsin, the senior Democrat on the House Appropriations Committee, said voters in his district wanted the government to provide needed services.
"At least 80 percent of the people I talk to want more investment in education, not less," Mr. Obey said. "They want more done with health care. We just opened a dental clinic in Portage County, which I got the money for a year ago, and we have a waiting list of 300 people and 400 more who can't even get on the waiting list. People recognize that there's plenty of need."
Moreover, Democrats say, spending by some measures remains relatively low by historical standards. Total government outlays this year are expected to equal just under 20 percent of gross domestic product, up from 18.4 percent two years ago but down from 23 percent 20 years ago.
Much of the spending increase this year and next year is tied to the fight against terrorism. But some of it comes from programs that many conservatives consider bloated or ineffectual, especially the new farm bill. Conservatives are considering steps like offering scores of amendments to tie up appropriations bills they consider excessive.
"This is the major issue for conservatives in the House," said Representative John Shadegg of Arizona, the chairman of the Republican Study Committee, a group of 70 conservatives who have been pressing their party's leaders to clamp down on spending.
"Many of us are deeply concerned about spending spinning out of control," Mr. Shadegg said. "We're looking at every option we have to make sure it doesn't."
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