What surplus?

Both presidential candidates are fighting over what to do with our $2
trillion surplus. The fight largely is meaningless because, back in
Washington, our elected representatives are spending it at a record
pace. The non-partisan Concord Coalition has warned that if
discretionary spending continues to grow at the same rate it has in
recent years, two-thirds of the projected 10-year non-Social Security
surplus will disappear.

The most widely-used surplus projection is the one prepared by the
Congressional Budget Office, which assumes that discretionary spending
will grow no faster than the rate of inflation over the next 10 years.
Concord’s budget experts point out that this assumption is at odds with
what actually has happened since budget surpluses began to replace
deficits in fiscal year 1998. “Starting that year and including the
likely level of spending planned for the current fiscal year (2001),
discretionary spending has gone up at an average annual rate of 5.5
percent.”

If spending continues to increase at this rate, rather than the rate
assumed in the CBO baseline, it would reduce the non-Social Security
surplus by $1.4 trillion. Instead of having a surplus of over two
trillion dollars, we would have a surplus of about $700 billion. That’s
a good sum of money, to be sure, but it is far less than the cost of the
presidential candidates’ promises.

The budget for the fiscal year 2000 expired on Oct. 1. In what has
become an annual ritual, the United States Congress has passed, and the
president has signed, a series of Continuing Resolutions to keep the
government running on a day-to-day basis until the next budget is
complete. The longer this process drags on, the more it costs American
taxpayers.

Last week, the Republican-led Congress reported that “new budget caps
have been locked-in” on spending. Translation: They officially
abandoned the caps agreed upon in April. The spring budget, of course,
completely disregarded the caps in the five-year Balanced Budget Accord
that was agreed to by members of Congress and the White House in 1997.

The new overall cap set by Congress for discretionary spending is
$637 billion. The resolution passed in April had a not-to-exceed figure
of $601 billion. Last year discretionary spending was at $570 billion.
The 1997 Balanced Budget Accord called for a cap of $542 billion. It’s
important to point out that the draconian cuts called for in the 1997
BBA — the cuts that never materialized — were not real cuts in
spending. They were cuts in the rate of projected growth.

Congress now is planning to spend $95 billion more on discretionary
items than what it agreed to just three years ago. So much for smaller
government! That represents a 17.5 percent increase. That’s a 2
percent increase over President Clinton’s budget request this year and
it is 4.3 percent over what the Congressional Budget Office set as the
inflationary baseline for FY 2001, after adjusting for all the gimmicks
that were employed in FY 2000.

The House of Representatives deserves some credit this year. Members
initially tried to hold the line on spending, passing all 13
appropriations bills at a level below CBO inflationary levels. However,
when Mr. Clinton sent out statements threatening to veto seven of the 13
because of inadequate funding, a spending free-for-all began in the
Senate and most, but not all, members of the House quickly followed
suit.

Here are just a few examples of the pork added to the FY 2001 budget
obtained from the National Taxpayers Union: $4 million for an
International Fertilizer Development Center; $4.5 million for aquatic
growth removal in Florida; $5.2 million for a new dormitory at the
National Constitution Training Center; $1.5 million to refurbish the
Vulcan Statue in Alabama; $2 million for the purchase of Cat Island in
Mississippi; $5.8 million to be transferred from the Coast Guard to the
City of Homer, Ark., for the construction of a municipal pier; and $1
million for the Jamestown Foundation to disseminate information and
support research about China.

Another $6 billion was added to the VA-HUD Appropriations Bill,
though not one penny of that $6 billion is going to our veterans! The
most recent outrage involves a cave-in to Mr. Clinton on the $14.9
billion foreign aid bill. The Republicans threw in the towel on the
“Mexico City” policy that had prevented the money we spend on
international “family planning” from being used for abortions or to
promote pro-abortion policies in foreign countries. In addition, they
added another $40 million for those controversial programs. Negotiators
agreed that the money could not be spent before next February. They are
banking on George W. Bush becoming president and reinstating the Mexico
City policy with an executive order. Why would Bush be willing to take
a stand on “Mexico City” when these congressional leaders were not?

If Bush becomes president and Republicans retain control of Congress
there will be other problems to confront. Every new dollar of spending
creates a new floor for spending in the next fiscal year. If
Republicans could not hold the line against the growth of government
with a Democrat president, what makes them think they can roll back
government with a Republican in the Oval Office? With every proposed
cut Democrats will paint them as heartless thugs.

In 1995, when Republicans dropped the fight against big government,
it was the beginning of the end. Instead of arguing that it is good to
have smaller government, they began arguing that it is bad to have a
deficit. When the deficit disappeared, they began arguing that it is
bad to spend the Social Security surplus.

Now that the money coming in from Social Security has been declared
“off limits,” they seem to have forgotten why the American people handed
them the keys to both chambers of Congress. It was to shrink the size
of government, to shrink the growing and burdensome bureaucracy that
seeks to rule every aspect of our lives. When there is an economic
downturn, our bloated government then will begin seeking an even greater
portion of what we own and earn.

Does your family have a surplus this year? Are you planning on one
for next year?