KevinTheOmnivore
Mar 10th, 2003, 05:43 PM
WOOHOO! My school gets the shoutout!
http://www.miami.com/mld/miamiherald/news/nation/5355727.htm
Posted on Mon, Mar. 10, 2003
Bush drastically revising government
Big defense growth, deep cuts in taxes mean lasting deficits
BY PETER G. GOSSELIN
Los Angeles Times Service
WASHINGTON - Two months after the White House began rolling out its latest budget, the full dimensions of President Bush's new tax and spending plan finally are coming into view, and they are even more sweeping than originally thought.
By linking expenditures forced on the nation by the 2001 terror attacks with a blizzard of other measures, Bush has produced a proposal that, if enacted, would result in a governmental about-face as far-reaching as those of Ronald Reagan or Lyndon Johnson.
Coupled with his approved 2001 cuts, the president's new tax package would make Bush the biggest tax cutter in at least two decades and arguably half a century. He would top even Reagan.
His proposed defense buildup would be bigger in real terms than Johnson's Vietnam buildup, and that's not counting the cost of a war with Iraq and its aftermath.
His plan to revamp Medicaid and other programs Washington, D.C., runs jointly with the states would be, in the words of a former Nixon administration budget official, ``one of the biggest pullbacks in federal responsibility we've ever seen.''
''Frankly, I'm pretty surprised,'' said Richard P. Nathan, now director of the Rockefeller Institute of Government at the State University of New York in Albany. Until now, ``We never heard much about this from this president.''
Administration officials have acknowledged freely that the combination of big tax cuts, substantial new spending and dramatic shifts in programs would push the government, which was running surpluses only two years ago, into deficit. But they have portrayed the problem as entirely manageable.
But Congress' top fiscal analyst said Friday the deficits that the president's plan would generate would be substantially bigger than previously thought. And a close look at the White House's own estimates suggests that they would be vastly more enduring than the administration has suggested.
STREAM OF DEFICITS
The nonpartisan Congressional Budget Office said that the new Bush budget would produce a steady stream of deficits over the next decade, totaling $1.8 trillion, and the agency indicated that the proposal's effects would be even larger than that.
Analysts said that in the absence of the president's plan, Washington would run a nearly $900 billion surplus over the next decade.
Yet even this larger figure misses a crucial aspect of deficits under the Bush plan -- one that the administration's own forecasts reflect but that officials have barely mentioned.
In contrast to the White House budget of only last year, which showed the government climbing quickly out of deficits and running surpluses for most of the next two decades, its latest budget concludes that as things now stand Washington is unlikely ever again to operate in the black.
In a long-term forecast buried deep in its new, five-volume budget, the administration shows that after growing during the next two years to 2.8 percent of GDP then shrinking a bit, the deficit begins an inexorable expansion.
CAUSES OF INCREASE
The burgeoning deficit is driven by the president's proposals and by the mounting costs of the baby boom retirement. Administration estimates show the combination would drive the deficit back above 2 percent of gross domestic product by 2020, above 5 percent of GDP by 2030, to nearly 9 percent by 2040, 12 percent by 2050 and so on.
Citing former Nixon economist Herb Stein's nostrum that, ''If something can't go on forever, it won't,'' analysts across the political spectrum said that in such circumstances something would have to give. For this administration, the something would be government spending.
''We're going to have to shrink the size of government,'' said Grover Norquist, president of Americans for Tax Reform, a conservative advocacy group with close ties to the White House. ``Our goal is to cut it in half.''
The only times in the past century that the government has shrunk by half were in the immediate aftermath of World Wars I and II.
BOLDNESS NOT STATED
Part of the reason that analysts have been so slow to come to grips with the full dimensions of the administration's new budget is that Bush and his key aides have chosen not to trumpet the boldness of many of their proposals.
But the full dimensions of the Bush budget are coming into focus, and at each turn they are they are bigger than almost anyone had previously thought.
The president's proposed defense buildup would be bigger than the Vietnam buildup of the 1960s as measured in constant, after-inflation dollars, a key barometer of real resources devoted to a program.
Defense spending would peak at $451.9 billion in 2003 dollars compared to a Vietnam peak of $439.9 billion, according to an analysis of administration figures by the generally liberal Center for Strategic and Budgetary Assessments.
-30-
http://www.miami.com/mld/miamiherald/news/nation/5355727.htm
Posted on Mon, Mar. 10, 2003
Bush drastically revising government
Big defense growth, deep cuts in taxes mean lasting deficits
BY PETER G. GOSSELIN
Los Angeles Times Service
WASHINGTON - Two months after the White House began rolling out its latest budget, the full dimensions of President Bush's new tax and spending plan finally are coming into view, and they are even more sweeping than originally thought.
By linking expenditures forced on the nation by the 2001 terror attacks with a blizzard of other measures, Bush has produced a proposal that, if enacted, would result in a governmental about-face as far-reaching as those of Ronald Reagan or Lyndon Johnson.
Coupled with his approved 2001 cuts, the president's new tax package would make Bush the biggest tax cutter in at least two decades and arguably half a century. He would top even Reagan.
His proposed defense buildup would be bigger in real terms than Johnson's Vietnam buildup, and that's not counting the cost of a war with Iraq and its aftermath.
His plan to revamp Medicaid and other programs Washington, D.C., runs jointly with the states would be, in the words of a former Nixon administration budget official, ``one of the biggest pullbacks in federal responsibility we've ever seen.''
''Frankly, I'm pretty surprised,'' said Richard P. Nathan, now director of the Rockefeller Institute of Government at the State University of New York in Albany. Until now, ``We never heard much about this from this president.''
Administration officials have acknowledged freely that the combination of big tax cuts, substantial new spending and dramatic shifts in programs would push the government, which was running surpluses only two years ago, into deficit. But they have portrayed the problem as entirely manageable.
But Congress' top fiscal analyst said Friday the deficits that the president's plan would generate would be substantially bigger than previously thought. And a close look at the White House's own estimates suggests that they would be vastly more enduring than the administration has suggested.
STREAM OF DEFICITS
The nonpartisan Congressional Budget Office said that the new Bush budget would produce a steady stream of deficits over the next decade, totaling $1.8 trillion, and the agency indicated that the proposal's effects would be even larger than that.
Analysts said that in the absence of the president's plan, Washington would run a nearly $900 billion surplus over the next decade.
Yet even this larger figure misses a crucial aspect of deficits under the Bush plan -- one that the administration's own forecasts reflect but that officials have barely mentioned.
In contrast to the White House budget of only last year, which showed the government climbing quickly out of deficits and running surpluses for most of the next two decades, its latest budget concludes that as things now stand Washington is unlikely ever again to operate in the black.
In a long-term forecast buried deep in its new, five-volume budget, the administration shows that after growing during the next two years to 2.8 percent of GDP then shrinking a bit, the deficit begins an inexorable expansion.
CAUSES OF INCREASE
The burgeoning deficit is driven by the president's proposals and by the mounting costs of the baby boom retirement. Administration estimates show the combination would drive the deficit back above 2 percent of gross domestic product by 2020, above 5 percent of GDP by 2030, to nearly 9 percent by 2040, 12 percent by 2050 and so on.
Citing former Nixon economist Herb Stein's nostrum that, ''If something can't go on forever, it won't,'' analysts across the political spectrum said that in such circumstances something would have to give. For this administration, the something would be government spending.
''We're going to have to shrink the size of government,'' said Grover Norquist, president of Americans for Tax Reform, a conservative advocacy group with close ties to the White House. ``Our goal is to cut it in half.''
The only times in the past century that the government has shrunk by half were in the immediate aftermath of World Wars I and II.
BOLDNESS NOT STATED
Part of the reason that analysts have been so slow to come to grips with the full dimensions of the administration's new budget is that Bush and his key aides have chosen not to trumpet the boldness of many of their proposals.
But the full dimensions of the Bush budget are coming into focus, and at each turn they are they are bigger than almost anyone had previously thought.
The president's proposed defense buildup would be bigger than the Vietnam buildup of the 1960s as measured in constant, after-inflation dollars, a key barometer of real resources devoted to a program.
Defense spending would peak at $451.9 billion in 2003 dollars compared to a Vietnam peak of $439.9 billion, according to an analysis of administration figures by the generally liberal Center for Strategic and Budgetary Assessments.
-30-