WASHINGTON (AP) - President Bush will propose an election-year budget Feb. 2 in a world starkly changed since his first White House bid, with recession, tax cuts, war and terrorism having transformed soaring surpluses into huge deficits.
Bush's $2.3 trillion budget for 2005 will woo voters by proposing to make already enacted tax cuts permanent, and probably seeking tax breaks for savers and for low-income people's health costs. It will also call for more money for defense, domestic security, education, space and the global fight against AIDS, according to administration officials, congressional aides and lobbyists.
His overall proposals, however, are sure to be less ambitious than those in his first budget in 2001, when he and others envisioned $5.6 trillion in surpluses over the next decade.
Bush used that blueprint to seek 10-year tax reductions totaling $1.6 trillion; $2.6 trillion for reducing the national debt and shoring up Social Security; and $153 billion for expanding Medicare.
How things have changed. The most recent estimates from the nonpartisan Congressional Budget Office are for 10-year deficits totaling $1.4 trillion. Private groups say the shortfalls could exceed $5 trillion if fresh tax cuts and spending increases are enacted, as many analysts expect.
It really is night and day
or day and night really. It's an amazing transformation of the budget landscape, said Robert Reischauer, president of the Urban Institute and former CBO director.
The administration says tax cuts it has pushed through Congress will spur the economy and help make deficits smaller, along with proposed spending restraints. E 17
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