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Thursday, June 21, 2007

Bush's Misleading Veto Strategy

Recently, the administration let it be known that it plans to veto upcoming appropriations bills in an attempt to regain the "fiscal responsibility" label for Republicans:

Bush plans to veto the Homeland Security appropriations bill nearing final passage, followed by vetoes of eight more money bills sent him by the Democratic-controlled Congress.

That constitutes a veto onslaught of historic proportions from a President who did not reject a single bill during his first term. Of the 12 appropriations bills for fiscal year 2008, only three will be signed by the President in the form shaped by the House. What's more, Bush correctly claimed he has the ... House votes needed to sustain these vetoes. The unpopular President is taking the offensive on fiscal responsibility. After bowing to Republican demands on earmarks, Democratic leadership faces a battle of the budget. ...

It is an offensive pressed on Bush by congressional GOP leaders and by his own budget director, Rob Portman... Portman believes the 2006 electoral catastrophe in his state was caused mainly by Republicans losing the mantle of fiscal responsibility. ... By vetoes that would slice over $20 billion in Democratic spending, Bush is seeking to transform that outlook...

And, from the report below:

From Rep Jerry Lewis, Ranking Member, House Committee on Appropriations:  … With regard to the majority’s plan to spend $80 billion over the 2007 enacted budget levels, I would submit to you that this represents exactly the kind of unfettered spending that so closely identifies the differences of our philosophies.  It’s pre-1995 all over again.  ‘If you see a problem, throw money at it.’ ”

But the CBPP has looked into this and questions the validity of the reasons that are being given for the vetoes:

The Fight over Appropriations: Myths and Reality, by Richard Kogan, CBPP: The House and Senate appropriations committees recently established funding levels for each of the 12 appropriations bills for fiscal year 2008, and have begun producing bills that meet these targets. The Administration has charged that these funding levels represent large, fiscally irresponsible increases in federal spending that would threaten fiscal stability and the economy.  It has threatened to veto most of the forthcoming appropriations bills.

The Administration’s sharp criticisms have been echoed by a number of Republican congressional leaders ... who accused the Democratic majority of “spending lust.”  Some 147 House Republican members — more than one-third of the House membership — have pledged to sustain the anticipated vetoes.

The strong criticism of the funding levels set for the appropriations bills is receiving wide coverage.  Yet comparing these levels with the current year’s appropriations and the President’s own budget request for 2008 reveals a picture sharply at odds with the attacks.

  • Some 81 percent of the $53.1 billion increase in appropriations under the emerging bills consists of increases for military and homeland security programs that the President himself requested. (These increases are not related to Iraq and Afghanistan, which are classified as “emergency spending” and hence not included in this analysis.)

  • This 81 percent figure climbs still higher when one takes into account the congressional increases for the State Department and international affairs that the Administration also requested.

  • Less than one-tenth (or $5 billion) of the $53.1 billion funding increase reflected in the congressional targets for the 2008 appropriations bills is for increases for the eight domestic appropriations bills.

  • Under the planned appropriations bills, overall funding for domestic programs — which include education, health and scientific research, transportation and infrastructure, housing, commerce, the environment, and law enforcement — would increase a modest 1.4 percent above the Congressional Budget Office baseline (i.e., the 2007 level adjusted for inflation). In real per capita terms — that is, after adjustment for both inflation and population growth — funding for these programs would barely increase at all. As a share of the economy, funding for these programs would actually edge down slightly.

  • Although funding for the domestic appropriations bills would be about $21 billion above the President’s request, these bills would not cause a $21 billion increase in funding. The President has proposed more than $16 billion in cuts in the programs funded in the domestic bills. Most of the $21 billion difference reflects the decision by the congressional majority to reject those cuts; as noted, the proposed increase for the domestic appropriations bills is only $5 billion.

In other words, the bulk of the allegedly irresponsible increase in funding for appropriated programs reflects the President’s own request for additional military and security funding. The increase that congressional leaders plan for domestic discretionary programs is quite small. 

The notion that this modest domestic increase of $5 billion, which follows several years of cuts in these programs, could have a noticeable effect on the $14 trillion U.S. economy is not credible. Nor is the claim that funding for domestic discretionary programs would put significant pressure on the deficit and force a tax increase, since these programs would grow less rapidly than either the economy or tax revenues. ...

... Conclusion The vast bulk of the increase in overall appropriations under the congressional plan reflects Congress’s decision essentially to go along with the President’s request for sizeable increases in military funding. 

For domestic programs, in contrast, the Administration is insisting on cuts and is threatening to veto appropriations bills unless those cuts are made.  Claims that Congress’s rejection of those cuts represents “spending lust” are unfounded. The question is not whether there should be large increases in domestic appropriations — since large increases are not on the table — but whether domestic programs should be cut (as the President demands) or increased modestly (as the Congressional majority favors). 

In addition, the Administration is threatening to veto the defense appropriations bill because the large increase it is slated to contain — $29 billion, or almost six times the increase in the eight domestic appropriations bills combined — is a few billion dollars less than the increase the Administration wants. Also, the Administration is seeking hundreds of billions of dollars more in deficit-financed tax cuts over the next five years than the congressional budget plan authorizes. All of this indicates that in the emerging battle over the fiscal year 2008 appropriations bills, the Administration and its supporters are misrepresenting a disagreement over budget priorities as a disagreement over fiscal responsibility.

It will be interesting to see how the press plays this - will they echo the administration's misleading rhetoric and pit this as a battle for fiscal responsibility, or will they dig a little deeper and reveal this for what it is? Will the administration get away with portraying spending cuts and tax cuts as a battle with Democrats for fiscal responsibility? Given how far they've been able to push this in the press already, I'm guessing the media will be more interested in the value of portraying this as some epic battle over spending rather than what it really is, a misrepresentation of the facts by the administration in an attempt to gain political advantage.

    Posted by on Thursday, June 21, 2007 at 11:25 AM in Budget Deficit, Economics, Politics | Permalink  TrackBack (1)  Comments (26)


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    Tracked on Thursday, June 21, 2007 at 04:39 PM


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