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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: D. Long who wrote (23132)	1/6/2004 2:57:37 AM
From: LindyBill	Read Replies (1) \| Respond to of 793696

Bush's Shrewd Budget Strategy By E. J. Dionne Jr. washingtonpost.com One of the mysteries that politicians and we commentators muddle as much as we clarify revolves around this question: If George W. Bush is such a conservative, why is he spending so much money and why are deficits so high? Liberals regularly assail Bush's tax cuts for creating big deficits, but also for limiting the government's ability to do more in areas where action is needed, especially health care and education. They paint Bush as miserly toward the needy. Bush's conservative critics highlight the big spending increases on his watch and conclude that such a profligate president is necessarily unfaithful to conservative principles. If Bush is being attacked from both sides, does that make him a "moderate"? Not at all. What it means is that Bush is pursuing a very shrewd political strategy that could have some very unhappy consequences for conservatives, moderates or liberals. We just can't know now which of these groups will be most unhappy in the long run. That's why Bush's approach is perfect for an election year. Take the conservative view. Bush has indeed spent a lot of money. Much of that money has gone to defense and homeland security. Another big chunk has gone to entitlements such as Medicare, Medicaid and Social Security, programs whose costs are driven by demographics, increases in the price of health care and the economic downturn. What bothers conservatives, says Bruce Bartlett, senior fellow at the National Center for Policy Analysis, are the domestic areas in which Bush has voluntarily increased the federal government's reach, specifically the new $400 billion prescription drug benefit under Medicare. "People have the idea that $400 billion over 10 years means $40 billion a year," says Bartlett, a conservative who served in the Reagan and first Bush administrations. But most of the bill doesn't even kick in until 2006 and after, so the cost "takes off like a rocket," producing a potentially large fiscal problem in later years. Conservatives, Bartlett said, might have supported a more modest program aimed at helping seniors who currently don't have drug coverage. But the program was broadened to cover large groups of seniors. Why? "They had to go for a universal drug program because that's the only way that big corporations like GM or Ford could lay off their liability for retirees onto the federal government," Bartlett says. Bartlett's conclusion: "Bush's idea of what it means to be conservative is to be pro-business." Indeed, the Medicare drug bill could have held down costs by using the federal government's enormous buying power to negotiate better prices with the drug companies. Instead, the bill explicitly prohibits such bargaining. That's good for the drug companies, but it's not fiscal conservatism. Liberals argue that Bush's big tax cuts have not only added to short-term deficits but will create a long-term fiscal crisis that conservatives will use to push for large spending cuts, even in popular programs such as Social Security and Medicare. The irony is that Bush's increases in certain areas disguise how little he has spent on most domestic social programs. In the past two years, says Richard Kogan, a senior fellow at the liberal Center on Budget and Policy Priorities, funding in areas outside the entitlement programs and international and homeland security has fallen slightly when inflation is taken into account. So Bush is anything but a big spender. Bush's tax cuts have also created a political trap for liberals and Democrats. In their debates, most recently on Sunday in Iowa, Democratic presidential candidates regularly trash each other over whether fiscal prudence and the need to finance new programs require repealing all of Bush's tax cuts, or only some of them. Watching these encounters must be sheer heaven for Bush's campaign operatives. And in his new budget, according to the New York Times, Bush will propose some spending restraint on housing vouchers for the poor, veterans' health care, biomedical research and job training programs. These are small cuts in relation to the overall deficit that could have a large impact on the affected groups. Democrats will (and should) oppose most of them. As soon as they do, Bush will claim the anti-spending high ground. Another trap. Here's what liberals and rebellious fiscal conservatives have in common: They know Bush's budget policies don't add up for the long run. Down the line, the continuing deficits will inevitably force either the tax increases conservatives abhor or the program cuts liberals fear. Bush says they won't, and he only has to make that argument hold up for the 10 months between now and Election Day. Bad policy? I think so. Smart politics? You decide. postchat@aol.com © 2004 The Washington Post Company