Budget Ideology

President Bush's budget, beyond the essentials of day-to-day government, reveals the ideological core of his administration. He believes the wealthy pay too much in taxes and that Social Security and Medicare, bulwarks for the less affluent, should be privatized. Bush inherited from Bill Clinton a tax structure that was designed to eliminate the national debt in preparation for the time when the baby boomers would retire and force the government to redeem bonds in the Social Security trust fund. A federal government with little debt would also have been able to handle extra stresses in Medicare.

Bush is right that the collapse of the stock market resulted in a decrease in tax revenue. Combined with increased spending on security and the need to stimulate the economy, this would surely have caused a brief reversion to deficit spending under any President.

Bush's tax cut approved in 2001 guarantees that deficits will linger beyond these immediate difficulties. He compounded his irresponsibility yesterday by urging that Congress make the cuts permanent and approve new reductions also aimed at the wealthy.

The President, in documents accompanying the budget, argues that his proposed elimination of the tax on dividends would help 10 million elderly people. Perhaps so, but many of them would no doubt rather see the $364 billion involved go for a prescription drug benefit, which Medicare lacks. Bush proposes to add this benefit, but the elderly would have to join a managed care plan first.

That's fine by the President, who believes that managed care will help control Medicare spending, just as he hoped that the privatization of Social Security would minimize the federal government's responsibility for maintaining secure retirements for the elderly.

The President's commission on Social Security was widely derided when it released a plan to partially privatize the system. Short-term costs would have soared, and young workers would have been at the mercy of the stock market for retirement security.

In a document called The Real Fiscal Danger, the President's aides also argue that unfunded liabilities threaten Social Security. This program and Medicare do face grave problems two decades hence. Bush, by reducing government revenue and refusing to consider plans that do not involve privatization, increases the difficulty of resolving them.

Bush proposes an admirable increase in funding to combat AIDS, extra money for community health centers, and an increase in funding for domestic security. But the budget is skewed to the wealthy and against people who need government help in their old age. Congress should reshape these priorities to protect the great majority of Americans.