Hawai'i lawmakers decry Bush budget, rising deficits

By Frank Oliveri
Advertiser Washington Bureau

WASHINGTON — About 18 cents of every dollar Americans pay in taxes goes to pay off the $7 trillion national debt.

Sen. Daniel Akaka

Rep. Ed Case

Some Hawai'i lawmakers are calling the president's proposal "reckless."

"This administration's ... fiscal policies have created skyrocketing deficits well into the future, and they constitute a preemptive strike on the economic security of future generations of Americans," said Democratic Sen. Daniel Akaka.

Democratic Rep. Ed Case said the president's overall fiscal policies steer too much money to some areas while shortchanging others. He also said the budget increases aren't solely because of the Iraq war or general federal spending increases. He blamed Bush's tax cuts and increases to defense and Medicare money.

"Essentially, the president's message is that we can have our cake and eat it, too — we can have both deep, across-the-board reductions in personal, business, estate and other taxes, and we can also dramatically boost federal spending in areas vital to the administration both philosophically and politically," Case said.

Anti-deficit groups, whose members include Democrats and Republicans, conservatives and liberals, warn that Bush's proposal could mean that the federal government, as well as state and local governments, will face billions of dollars in devastating cuts, similar to what California faces today.

"I'm concerned about where things are going," said Rep. Jim Matheson of Utah, a member of the Blue Dog Coalition, a group of fiscally conservative Democrats. "We need spending caps."

But Republican Sen. Robert Bennett of Utah, chairman of the Joint Economic Committee, said Americans shouldn't be too concerned about the $7 trillion federal debt, or the projected budget deficits for the next several years.

"What you need to worry about is if the recovery will continue to gain traction," Bennett said. "If it does, federal and state revenues will rise."

The federal deficit is the annual shortfall between what the U.S. government takes in and what it spends. The national debt is the accumulation of those annual deficits.

Debate over federal deficits intensified after the Congressional Budget Office forecast huge shortfalls during the next 10 years. It projected that the deficit could reach $477 billion this year and could accumulate to $1.9 trillion between 2005 and 2014.

The annual projections are merely guidelines because CBO must make projections based on current policy, and federal spending is an extremely fluid process.

Akaka said the president needs to focus on issues such as education rather than providing tax breaks for those with the highest incomes.

He said the No Child Left Behind school-reform law was shortchanged by $6 billion in 2004 and would be shortchanged by $7 billion next year under Bush's proposed budget.

"Although Hawai'i would receive $67 million under this proposal, 7,454 disadvantaged students across the state will be denied services," Akaka said.

Budget watchdogs appear to agree that spending deficits need to be reduced. They disagree, however, on how to do it.

Conservatives such as Brian Reidl of the Heritage Foundation says the government should spend less on unemployment benefits, education, general government and aviation security.

Most spending increases during the past three years have been in homeland security and military spending. The Pentagon budget, for example, increased by 33 percent — or roughly $100 billion — in the past three years.

Iris Lav, deputy director of the left-leaning Center on Budget and Policy Priorities, fears that grants, money for education and other forms of aid to state and local governments could suffer the most as the GOP-dominated Congress works to control spending.

"That is something that one needs to watch," she said. "We're likely to see cuts in aid to states."