February 8, 2005
By DAVID LIGHTMAN, Washington Bureau Chief
WASHINGTON -- By cutting
and combining dozens of popular government programs, President
Bush's $2.57 trillion budget carries the distinct, personal
imprint of a leader who can finally claim a mandate to reshape
government in fundamental ways.
The budget released Monday, the White House says, will make
government at all levels more efficient and responsive while
boosting the economy. But critics fear it will create new crises
for already overtaxed state and local governments.
"These are front-line services and preventive services
that are being cut," said Hartford Mayor Eddie Perez. State
congressional delegation members met with Gov. M. Jodi Rell and
vowed to fight the more severe reductions.
Connecticut stands to lose about 8 percent, or $97 million,
in certain key federal aid programs, according to estimates from
the governor's office.
Bush and his allies insisted they were not being insensitive,
just efficient. Don't just look at the money being slashed, his
backers said, but consider the 377-page budget and 1,308-page
appendix as a blueprint for much-needed change in the way government
Critics, said House Majority
Whip Roy Blunt, R-Mo., should view the fiscal 2006 budget as "a
helpful starting point as Congress begins this debate and looks
for real ways to rein in wasteful spending."
Beyond the vital-services-vs.-wasteful-spending debate is the
fact that this budget, the first of Bush's second term, bears
his personal philosophical imprint like none that came before
Prior Bush budgets seemed to reflect the political needs of
a president elected without a popular majority, as well as one
who had to deal with an almost evenly divided Senate.
"You sit back and look at some of those Bush budgets in
the past and you'd think Lyndon Johnson was in charge," said
David Keating, executive vice president of the conservative Club
for Growth. In 2004, for instance, discretionary spending - the
money that Congress and the White House have some control over
- was up 8 percent, well above the rate of inflation.
Now, Bush begins his second term not only having won a popular
majority, but also seeing both Houses of Congress dominated by
And so this budget boldly brims with ideas almost unseen in
a presidential document since the headiest days of the Reagan
administration more than 20 years ago. Twelve of the government's
23 major agencies will have their budgets reduced next year,
with transportation, housing, agriculture and the Environmental
Protection Agency getting the sharpest reductions. Discretionary
spending lags behind inflation, growing just 2.1 percent.
Gone would be 150 programs, including 48 in the Department of
Education alone. There would be sharp cutbacks in a number of
programs Connecticut and its towns have come to rely on: community
policing grants, dislocated worker aid, housing for people with
disabilities, aid to small and mid-size manufacturers, Amtrak
operating subsidies and help for emergency medical services for
Bush makes clear all this has a purpose. One is slashing the
deficit by half from its projected 2004 peak of $521 billion
while the economy continues to grow at a healthy pace. His fiscal
2006 deficit would be $390.1 billion, down from a projected $427
billion this year.
The other goal is making government more effective, which is
why, for instance, he wants to put 18 community programs, including
Community Development Block Grants, empowerment and enterprise
zones, chemical cleanup and community services grants, under
one Department of Commerce umbrella. The new consolidated program
would get an estimated $3.7 billion, 34.5 percent below the total
of $5.66 billion being spent on the 18 programs this year.
States and cities would compete for the grants, instead of getting
money now largely guaranteed to them, and could use the funds
for a variety of purposes, including business financing, infrastructure
development and housing.
Currently, the Bush budget says, only 38 percent of community
money goes to states and cities with poverty rates below the
national average. By making such grants competitive, the funds
can be sent where they are needed, the argument goes.
Hartford officials disputed
that notion. "This money doesn't
come automatically now," said Rep. John B. Larson, D-1st
District, one of those meeting with Rell Monday. "You already
have to demonstrate a need."
Standing behind him were state and local officials, already
strapped for money, who see themselves having to pick up the
Perez, for instance, noted that the community grants are often
relatively small sums that supplement money from private sources.
The federal money goes to a wide variety of services, including
help for first-time homeowners, senior meals and after-school
"I don't think anyone would challenge the need for the
work we do," he said. Cutting the federal dollars won't
simply mean a sudden end to these services, because "there
are things we have to do to keep this community viable."
To some local officials, the Bush budget could compound a problem
that has been growing for years. They have been complaining for
some time that Bush's No Child Left Behind school reforms saddle
them with mandates but not enough funds.
Monday's budget offered a lengthy defense of the program, and
pledged a 4.7 percent increase in funding for Title I grants,
the primary form of federal assistance to communities with low-income
students. And it provides stable or increased funding for a number
of other initiatives, such as programs to help preschool and
elementary school students improve their reading skills.
But education takes a big hit in other ways. A total of 48 programs
would end, including the Even Start literacy program, parental
information resource grants and the Safe and Drug-Free Schools
Some of the savings would be directed to Title I and other programs,
notably a $1.2 billion effort to help states improve graduation
rates and academic achievement in high schools.
It's not enough, said Kevin Maloney, Connecticut Conference
of Municipalities spokesman.
"The total cost of complying with No Child Left Behind
will go well beyond that," he said, "and it will impact
the property tax, particularly in poorer towns." Inner-city
schools are seen as more likely to have difficulty complying
with federal requirements under the 2002 law that students make
adequate annual progress in meeting state academic standards.
Mayors and governors are unlikely to end - or are forbidden
by law to end - many of these programs, and are shuddering to
think how they will make up the money. The National Governors
Association's 2004 Fiscal Survey of the States found Medicaid
and education costs each consume an average of about 21 percent
of state budgets.
The more Washington relies on states to fund schools and health
care for the poor, the more dire the state budget situation gets.
A state is considered healthy if it has a year-end balance of
about 5 percent of its budget left; there were 16 states at the
end of last year, including Connecticut, that fell below that
The White House and its backers countered Monday with an argument
that has gained currency among conservatives since the Reagan
presidency: that smaller government means more money in taxpayers'
pockets. That, in turn, means they spend, invest and pay more
taxes and everyone prospers.
"American families understand the importance of establishing
a blueprint for spending decisions," said Blunt. Added Keating, "The
best way to get a healthy, growing economy is to keep spending
There is some new and increased
spending on Republican favorites designed to prod the economy.
Bush wants to create Lifetime Savings Accounts, which would
provide tax breaks for accounts designed to help taxpayers
with emergencies, and Individual Development Accounts for low-income
families. Such accounts could be used for "major purchases," such
as a first home.
The president would also make
$100 million available to states to "develop innovative approaches to promote healthy marriages," as
well as provide more funding for hydrogen fuel, clean coal and
nuclear energy research and tax credits for lower-income people
who buy health insurance.
There are also some omissions, notably the specific cost of
the war in Iraq or details for funding the Social Security reforms
Bush has been pushing. These costs will be added in as the budget
process moves along.
The scrutiny officially begins today at the House and Senate
Budget committees, where Office of Management and Budget Director
Josh Bolten will defend the document before the House Budget
Congress has until mid-April to approve spending guidelines,
and until Oct. 1 to enact specific details. It rarely meets those
deadlines, and few on Monday expected them to be met this year.
Not when Sen. Christopher
J. Dodd, D-Conn., complained the budget "guts
critically important investments that make a real difference
in the lives of working Americans while ladling out goodies for
those at the top of the economic ladder," or House Minority
Leader Nancy D. Pelosi, D-Calif., labeled it "a hoax on
the American people."
And more significantly, instead of warm praise, House Speaker
Dennis Hastert, R-Ill., was mild and restrained in his assessment
of the budget's prospects.
"A good starting point," he
Reprinted with permission of the Hartford Courant.
To view other stories on this topic, search the Hartford Courant Archives at