President Bush's $1.446 trillion budget for the fiscal year starting next October comes close to confessing that the federal government is plunging into debt at the rate of $1 billion a day. His precise figure is a record $318 billion, but this assumes a "shorter and shallower recession" than usual and provides a "place card" of $15 billion for a gulf war whose costs admittedly will go much higher.
Yet if confession is good even for the soul of U.S. budget director Richard G. Darman, the latest seven-pound, 2,029-page federal compendium of the fiscal future has its merits. Already known for his irreverent rebuke to Reagan era "now-nowism," Mr. Darman summarizes the past ten years as a period of "collective irresponsibility -- spending in the short term and leaving the bills to the future."
His commentary on the phony Gramm-Rudman deficit targets that have been mercifully abandoned was instructive. Prior to last year's budget agreement, which substituted presumably tight spending caps for Gramm-Rudman legerdemain, Mr. Darman acknowledged "there were incentives for the administration (i.e., his administration) to err in the direction of rosy projections. . . (and) for the Congress first to criticize these projections (visibly) and then to adopt the same projections (invisibly)."
As to whether these "perverse incentives" have been eliminated, the jury is out until the White House and Congress show that new ceilings on defense and domestic spending are not porous. Equally important, the government has to demonstrate that in addition to curbing these discretionary programs it can make headway in slowing the growth of mandatory programs that, in Mr. Darman's words, are "taking over the budget."
Perhaps the most encouraging aspect of the Bush-Darman budget is the announced intention to cut back on subsidies for middle-class and upper-income beneficiaries of such mandated entitlement programs as Medicare, farm subsidies, school lunches and veterans pensions. The budget presents disturbing evidence that "the growth (in these programs) has gone to the non-poor," adding: "It is likely to be necessary -- and in any case appropriate -- to reduce the subsidies for those who are not needy."
To be sure, there is fancy political footwork in this approach. The Republican administration would like nothing better than to embarrass the Democrats by knocking some of their favorite entitlement programs on grounds of "fairness" -- a word the Democrats think they own.
If one is to look in true Sherlock Holmes fashion for what is missing in the new budget presentation, it is Social Security, that most sacrosanct bastion of the gray-power lobby. Not a word was breathed about increasing tax liabilities on the Social Security income of the affluent elderly. Yet if the government is ever to increase its revenue base substantially, this has to be a top-priority source.
Otherwise, there may be more budgets in the future with $1-billion-a-day deficits.