Fuente : John Kerry
http://www.johnkerry.com

New Report Reveals $6 Trillion in Hidden Spending in Bush Budget

Who is Going to Pay for the Bush $6 Trillion Spending Spree?

/noticias.info/ Widening the White House’s growing credibility gap, a new report released today by John Kerry for President reveals that President Bush has proposed or passed $6 trillion in new, unpaid initiatives during the first three years of his administration. The report shows that while the President and administration officials have publicly touted their commitment to fiscal discipline, they were quietly pushing trillions of dollars in unpaid proposals that have resulted in skyrocketing deficits and contributed to state budget deficits across the country.

Relying on specific proposals that President Bush has actually proposed or signed into law and official cost estimates, today’s report exposes the Bush administration for abandoning any semblance of fiscal discipline and turning the nation’s record surpluses into record deficits.
“President Bush has mortgaged the fiscal health of the country and left future generations burdened by a mountain of debt,” said former Clinton administration Deputy Treasury Secretary Roger Altman. “In the end, taxpayers will get stuck with the bill for George Bush’s recklessness with increased state taxes and higher costs in areas like education. If a family managed their household budget like this, they’d lose their house, their car, and any hope of building a brighter future for their children.”

President Bush and administration officials have long maintained that they are committed to fiscal discipline. In 2002, Bush said “if Congress will not show spending restraint, I will enforce spending restraint.” And in a recent radio address, the President proposed making spending limits the law, saying “budget limits must mean something.”

Yet as today’s report shows, these comments were just more examples of empty rhetoric and political posturing by the Bush White House. The White House’s reckless tax cut for the wealthiest Americans will cost Americans over $2.2 trillion in the next decade alone and its plan to privatize Social Security costs $1.4 trillion. The Bush White House has pushed a Medicare prescription drug plan that represents a giveaway to big drug companies without providing any real relief to seniors.

The $6 trillion figure is actually conservative since it does not even count what the Bush tax cuts have cost to date and excludes the true costs of many of their other plans, like the Mars mission.

Bush’s economic recklessness has had serious consequences outside of Washington. While the President has racked up $6 trillion in new spending without a penny to pay for it, Governors across the country have been struggling to balance their budgets. With no help available from the federal government, states have been forced to increase taxes and make cuts in spending.

“When it comes to spending, this administration’s rhetoric does not match the reality,” Altman said. “In public, this President professes to be a fiscal conservative, but in truth, he has pushed $6 trillion in new spending without ever paying for a penny of it. That’s reckless, and it’s the American people who will pay in the end. It’s time we put our country back on the path to fiscal responsibility by electing a new President.”

A fact sheet and today’s report are below.



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Fact Sheet:

GEORGE W. BUSH’S UNPAID BILLS TOTAL OVER $6 TRILLION
WHO IS GOING TO PAY FOR THE BUSH $6 TRILLION SPENDING SPREE

George W. Bush rejected ten strong years of fiscal discipline, in which new spending was accounted for and tax cuts were offset by decreases in spending. Instead he has run up a spending bill that will increase the deficit by more than $6 trillion over the next ten years alone. His tax cuts, expansion of entitlement programs and spending has grown into a $6 trillion bill over the next ten years. It is not a bill he plans on paying for. He’s leaving it for the taxpayers and their children.

BREAKING PROMISES AGAIN AND AGAIN: BUSH SAYS HE’S FOR LIMITING SPENDING

Bush Proposes Paying for Spending. To assure that Congress observes spending discipline, now and in the future, I propose making spending limits the law. This simple step would mean that every additional dollar the Congress wants to spend in excess of spending limits must be matched by a dollar in spending cuts elsewhere. Budget limits must mean something, and not just serve as vague guidelines to be routinely violated.” [Bush Radio Address, 1/31/04] But George Bush hasn’t paid for a penny of his over $6 trillion bill.

Bush Pledged to Cut Spending – But Instead He has a $6 Trillion Bill. During a radio address, George Bush pledged to cut spending. Bush said, “If Congress will not show spending restraint, I will enforce spending restraint. For the good of our economy, for the good of the people who pay taxes, my administration will spend what is truly needed, and not a dollar more.” [Bush Radio Address, 8/17/02]

Bush Pledged to Save Money to Pay Down the Debt – Now That Money Is Part of His $6 Trillion Bill. During a debate with Senator John McCain, then Governor George W. Bush said he would pay down the debt. Bush said, “I believe we’ve got $4 trillion over 10 years; $2 trillion of which will go to save Social Security and pay down the debt; $1 trillion available for debt repayment and other programs; and $1 trillion over a 10-year period, for a meaningful, substantial real tax cut to the people.” [Associated Press, 1/26/00]

TOTALING UP THE SPENDING – $6 TRILLION. Bush’s unpaid initiatives total to $4.9 trillion in the next decade alone, with debt service costs they will increase the deficit by $6.5 trillion over ten years. It is a bill that the Bush Administration has decided to ignore and tack onto their skyrocketing deficit. Someone has got to pay Bush’s $6.5 trillion spending spree –the American taxpayers and their children

$2,227 Billion in Enacted Tax Cuts. The Bush Tax Cuts that have already been enacted when extended over the next ten years will total to $2,227 billion in the next ten years [Joint Committee on Taxation]

$243 Billion in Other Tax Cuts. Bush has proposed other tax cuts, such as his flawed health care plan that will help the wealthiest and healthiest Americans. These additional tax cuts cost an additional $243 billion over the next ten years.

$1,427 Billion Social Security Privatization. George Bush has proposed privatizing Social Security and creating individual retirement accounts. This plan will not only put the fiscal future of America’s seniors in doubt, it will also cost the American taxpayers an additional $1,427 billion. [Council of Economic Advisors, Economic Report of the President, 2004]

$887 Billion in Other Mandatory Spending. Bush has proposed other spending such as the Medicare prescription drug benefit that his own actuaries said was more expensive than he budgeted for. Other plans such as Mars and Missile Defense will also cost money.

$1,642 Billion in Interest on the Debt. As anyone who has ever had a credit card knows, racking up huge debt costs even more, because you have to pay interest. The additional costs of the Bush plans for interest on the debt costs $1642 billion over the ten year period.

$6 Trillion is a Conservative Number. It doesn’t include the real cost of his Mars initiatives or the energy bill he has promised to sign. It doesn’t include some of his other tax plans he wanted to pass or what his tax cut for the wealthy has already cost in the early years. It doesn’t include defense or Iraq. Basically, American taxpayers cannot afford another four years of George W. Bush.

Report:

REPORT ON MORE THAN $6 TRILLION OF UNPAID BUSH INITIATIVES
BUSH HAS PRESIDED OVER A RECKLESS SPENDING EXPLOSION

April 5, 2004

Perhaps the most harmful fiscal policy decision made by the Bush Administration has been to completely disregard any attempt to propose or pass new initiatives with offsetting savings to ensure that they do not explode the deficit. While there may be occasional, justifiable exceptions not paying for a specific proposal, President Bush’s utter abandonment of any sense of fiscal discipline or even the slightest effort to pay for new initiatives represents a stunning reversal from the accepted practice in the 1990s, and has had highly damaging consequences for our nation’s fiscal position. He has presided over a spending explosion – proposing or signing into law over $6 trillion in unpaid for initiatives just in 2005 to 2014 alone. That doesn’t even count the costs of the early years of the tax cut or his plan to repeal the corporate AMT.

SUMMARY OF THE REPORT

1. President Bush Has Proposed or Signed Into Law New, Unpaid Initiatives That Increase the Deficit By $6.5 Trillion from 2005-14. The report attached shows that President Bush has either proposed or passed entitlement and tax proposals that total $4.8 trillion from 2005-14, with debt service costs these initiatives would increase the deficit by $6.5 trillion over ten years. President Bush has not proposed any offsets to ensure that his initiatives do not explode the deficit. This does not even include what he proposed or spent that impacted budgets in the early years of his presidency or the long-term implications. Unlike the repeated practice by the Bush campaign of asserting – and even making up – policy proposals and cost estimates never proposed by Senator Kerry, the analysis below relies on specific proposals that President Bush has actually proposed or signed into law, with official cost estimates.

2. President Bush’s Unpaid Initiatives Increase the Deficit By More Than $900 Billion in 2014 Alone. President Bush’s unpaid initiatives explode in cost, increasing the deficit by $335 billion in 2004 growing to $940 billion in 2014.

3. Bush’s Abandonment of Paying for Proposals Is a Complete Reversal of the Bipartisan Commitment to Fiscal Discipline in the 1990: The practice abandoned by President Bush in his four budgets had gained widespread bipartisan support in the 1990s. Budget rules were passed in 1990 and signed into law by the first President Bush. They were extended in 1993 and 1997 – both times with the strong support and vote of Senator Kerry. Even during the budget showdowns of 1995, both President Clinton and Speaker Newt Gingrich agreed on one thing: that any new initiatives should contain offsets and be proposed within the larger context of fiscal discipline.

4. $6.5 Trillion in Unpaid Initiatives is a Conservative Estimate: The $6.5 trillion increase in the deficit from Bush’s initiatives is a very conservative estimate that does not include a number of initiatives Bush has strongly and consistently supported including defense and homeland security, the cost of Iraq, Afghanistan, and the war on terror, the true cost of the Mars mission, the energy bill, the cost of the Bush proposals from 2001-04, the many unpaid-for proposals President Bush has made in previous years, or the excessive long-term costs of Retirement Savings Accounts and Lifetime Savings Accounts.

THE BUSH RECORD: A SPENDING EXPLOSION

When the Bush Administration decided to abandon any responsibility to pay for new proposals or present any semblance of a fiscally responsible budgetary framework, it was not only charting a harmful course for our nation, but were making a radical departure from what was a broad, bipartisan commitment to fiscal discipline in the 1990s. Despite dramatically different priorities, the strong commitment of both Democrats and Republicans to fiscal discipline led to record surpluses in the late 1990s and contributed to the longest economic expansion in our nation’s history. As a result, President Bush inherited the strongest fiscal position in our nation’s history, with surpluses projected in January 2001 of $5.6 trillion over the next decade.

In 1990, the bipartisan Budget Enforcement Act established new budget rules, requiring policymakers to pay for any tax cuts or entitlement spending increases, so that such policies would not increase deficits.
These rules were extended by President Clinton as part of the Omnibus Budget Reconciliation Act of 1993 and the Balanced Budget Act of 1997, which passed with broad bipartisan support. Senator Kerry voted in favor of both of these bills.
The Bush Administration let these rules expire, opening the door for its deficit exploding tax cuts, and recently put forward a proposal to reinstate them only on new spending initiatives – a cynical, ineffective gimmick that gives the appearance of budget discipline, while offering a completely free pass for tax cuts and corporate subsidies.
John Kerry will reestablish a commitment to paying for new proposals and will restore fiscal sanity in Washington DC.
THE RESULT: $6.5 TRILLION INCREASE IN THE DEFICIT FROM BUSH’S UNPAID COMMITMENTS

Over the past three years, the Bush Administration has proposed or signed into law tax and mandatory spending initiatives that will cost $4.8 trillion from 2005-14, together with debt service they will increase the deficit by $6.5 trillion. President Bush has never offered any plan to offset the costs with spending cuts or tax increases. The cost of the Bush legislation and proposals grows from $335 billion in 2004 to $940 billion in 2014. The result has been not only to explode annual deficits, which have now reached record levels at $500 billion as far as the eye can see, but to destroy sense of mutual commitment to fiscally responsible budget policy so vital to making progress in Washington. The table on the following page lists the major initiatives put forward by President Bush with no offsets or framework to cover their costs. It is followed by a list of the spending and other initiatives not included in the conservative estimate and an appendix which provides more detail on the cost estimates included in the table, and the Administration’s support of various initiatives.



Bush’s Unpaid for Proposals


Tax Cuts
Cost of Bush Tax Cut Already Enacted & Bush’s Proposed Extension
[Source: Calculations based on Joint Committee on Taxation (JCT), Various Years]

Other Tax Proposals in the FY2005 Budget [Source: JCT, 3/03/04]
Health Insurance Tax Credit
Expansion of Health Savings Accounts
Deduction for Long-term Care Insurance
Savings Account Proposals
Other (Including Offsets)

Subtotal, Tax Cuts

Entitlements, Other Mandatory Spending, and Other Items
Medicare Prescription Drugs [Source: OMB 2/04, $534 billion from 2004-13]
Social Security Individual Accounts [Source: Based on Economic Report of the President, 2004]
2002 Farm Bill [Source: CBO Budget Outlook 8/02]
Military Retirement Reforms [Source: CBO Budget Outlook January 2004]
Other Enacted Mandatory Legislation
[Source: Various CBO Budget Outlooks]
Mandatory Proposals Included in FY2005 Budget [Source: CBO, 3/04]
Missile Defense [Source: Increase in 2005 extended forward 10 years]
Mars Mission [Source: NASA]

Subtotal, Entitlements, Other Mandatory Spending and Missile Defense

Total Initiatives and Proposals

Debt Service
10-year costs(2005-14)

$2,277 billion







$61 billion
$25 billion
$27 billion
$6 billion
$124 billion

$2,519 billion



$616 billion

$1,427 billion

$82 billion

$31 billion

$112 billion

-$10 billion

$56 billion

$1 billion

$2,314 billion


$4,834 billion

$1,642 billion

TOTAL COST OF BUSH INIATIVES AND PROPOSALS $6.477 trillion


ESTIMATE OF COST OF BUSH PROPOSALS IS VERY CONSERVATIVE

The estimated total $6.5 trillion cost of Bush’s unpaid for initiatives does not include:

Defense and Homeland Security ($1 trillion over 2005-14): President Bush’s FY2005 budget proposes defense spending for 2005-14 that is $1.1 trillion higher than the baseline projection made by CBO in January 2001 – taking out missile defense it would add more than $1 trillion to the totals above.[1] In 2005 alone, President Bush is requesting $421 billion for defense –substantially more than the $347 billion baseline projected in CBO’s January 2001 budget report.
The Cost of Iraq, Afghanistan, or the War on Terror ($240 billion over 2005-14): President Bush’s defense numbers do not even include funding for Iraq, Afghanistan, or the War on Terror – which CBO projects will cost $240 billion from 2005-14.[2]
The True Cost of the Mars Mission ($160 billion to $1 trillion): President Bush has only included $1 billion in increased NASA funding to fulfill his ambitious plan to establish a lunar base and land people on Mars. Independent estimates of the cost of the Mars mission range from $160 billion to $1 trillion.[3]

The Energy Bill President Bush Has Promised to Sign (adds $24 billion): The President promised to sign the energy bill costing $24 billion (Conference Report for H.R. 6, the Energy Policy Act of 2003). But his budget only includes $7 billion for energy (see FY2005 Budget, Table S-9).
What Bush’s Legislation Has Already Cost ($630 billion): The tax cuts and mandatory spending legislation signed into law by President Bush has already cost $630 billion from 2001 through 2004.[4]
Previously Unpaid For Proposals Made By Bush (more than $200 billion): President Bush has proposed numerous other unpaid for initiatives including:
Repealing the Corporate AMT ($24 billion)
Medicaid state-optional block grants ($72 billion)
Excessive Long-term Costs of Retirement Savings and Lifetime Savings Account: These proposed accounts are designed with relatively small ten-year costs which hide their explosive costs in the long-term. Not included in this analysis is the fact that over the next 75 years they would create an additional fiscal deficit more than one-third as large as our current Social Security deficit – today’s equivalent of $300-$500 billion added to the deficit over ten years.[5]
APPENDIX

1. NOTES ON THE ESTIMATES INCLUDED IN THIS ANALYSIS

Tax Cuts Signed Into Law: The cost of the three Bush tax cuts includes the cost of the three tax cuts signed into law by President Bush and his FY2005 budget proposal to extend and make permanent most of the elements of these proposals.

Additional Tax Cuts Proposed by the Administration: All estimates included in this analysis are the official scored costs of Administration tax propsoals as reported by JCT. Note that the cost of the Administration’s savings account proposals, including Lifetime Savings Accounts, Retirement Savings Accounts, Employer Retirements Savings Acocunts, and a small Individual Development Account proposal, is held artificially low by reporting at ten-year estimate, as the full cost of these back-loaded proposals explodes in out-years. When fully implemented, the cost of these proposals will grow to today’s equivalent of $300-500 billion over ten years, and over 75 years would open up another deficit hole more than one-third as large as our current Social Seurity Gap (see Center on Budget and Policy Priorities, 02/27/04; and Tax Policy Center “Key Thoughts on RSAs and LSAs.” 02/04/04).

Entitlements and Other Mandatory Spending: All estimates included in this analysis are the official CBO cost projections of the Administration’s propsoals, unless otherwise noted. Please note:

a. The estimated cost of the Social Security Privatization plan supported by the Administration is based on the Social Security Actuary’s scoring of the Presidental Social Security Commission's Model 2 (assuming full participation in private accounts and associated interest). These figures are consistent with the cost estimate included in the Administration’s own 2004 Economic Report of the President, Chapter 6, pp. 143-146. The Economic Report of the President acknowledges that this Social Security Reform plan would result in an increase in public debt of 23.6 percent by 2036 (p. 143). See below for a list of statements by President Bush confirming support for such a Social Secuity Individual Acocunt plan.

b. The Farm Bill, Military Retirement Reforms, and Other Enacted Mandatory Legislation is based on the “Changes in CBO’s Baseline Projections of the Deficit or Surplus” table included in CBO’s regular Budget Outlook reports.

c. The -$10 billion figure for other mandatory proposals in the President’s 2005 budget reflects $19 billion in increased customs user fees outweighing a $9 billion increase in other mandatory spending.

d. The estimate of the cost of missile defense is based on the fact that 2001 spending on missile defense was $5 billion. President Bush is requeting $10.2 billion for 2005. Calculating the 2005 increase relative to inflation and carrying it forward totals $56 billion over ten years. Note, this is substantailly less than CBO’s estimate of the cost of deploying missile defense.

2. BUSH STATEMENTS IN SUPPORT OF REFORMING SOCIAL SECURITY TO CREATE PRIVATE ACCOUNTS

“Younger workers should have the opportunity to build a nest egg by saving part of their Social Security taxes in a personal retirement account.” [State of the Union Address, 2004]

“[W]e must offer younger workers a chance to invest in retirement accounts that they will control and they will own.” [State of the Union Address, 2003]

“We must…allow personal retirement accounts for younger workers who choose them.” [State of the Union 2002]

“The President…proposed that choice be a feature of Social Security itself, allowing individuals to voluntarily invest a portion of their Social Security taxes in personal retirement accounts.” [“President Bush’s Retirement Security Plan, White House Website]

“[W]e must apply the power of savings, investing, and compound interest to the challenges of Social Security by introducing personal retirement accounts into the system.” [Remarks at the National Summit on Retirement Savings, February 28, 2002]

“I share the Trustees' view that we need to explore new ways to ensure that Social Security remains strong and financially secure for America's children and grandchildren…Although these proposals differ in details, they are consistent in showing that if we give workers the opportunity to invest a portion of their wages in personal accounts, Social Security will be able to offer higher benefits than would otherwise be the case.” [Bush Statement on the Social Security Trustees Report, March 17, 2003]

“Those on Social Security today will have their promise made but also to give younger workers the option of their choice of being able to manage some of their own money in the private sector... I want younger workers to be able to manage some of their own money, some of their own payroll taxes in the private sector” [Presidential Debate October 3, 2000]

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[1] Calculation based on Congressional Budget Office 2001 and 2004.

[2] Congressional Budget Office, Long-term Implications of Current Defense Plans: Summary Update for Fiscal Year 2004, July 2003.

[3] The $160 billion estimate is from Congressional Testimony by Michael Griffin, former Chief Engineer of NASA on 3/10/04. The $1 trillion estimate is from Gregg Easterbrook, “Red Scare,” The New Republic, 2/2/04.

[4] Based on various CBO Budget Outlook’s.

[5] Center on Budget and Policy Priorities. “President's savings proposals likely to swell long-term deficits,
reduce national saving, and primarily benefit those with substantial wealth.” 02/27/04.

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