Painful echoes

August 29, 2002

ANOTHER PRESIDENT BUSH. Another mushrooming budget deficit. Another clamor from Democrats for an economic summit that would provide bipartisan cover for a deal to raise taxes -- or least forgo tax cuts that have not yet taken effect.

At the former summer White House in Maine, fallout from the latest estimates of the widening gap between federal income and outgo must be invoking terrible memories of the 1990 economic summit. The resulting bargain took the first crucial step toward reversing three decades of red ink. But it cost George H.W. Bush his presidency.

At the current summer White House in Texas, George W. Bush apparently sees another opportunity to learn from what he perceives as his father's mistakes. He brooks no talk of yielding on his signature $1.35 trillion tax cut. He says the answer is cutting taxes deeper. He bashes the Democrats for spending too much even as he matches them dime for dime.

Granted, there's no reward for courage in politics. But it's too bad that the scar tissue from 1990 is still so tender that President Bush can't even contemplate a re-evaluation of his budget priorities to take into account how vastly the fiscal landscape has changed over the past year.

A new Bush economic plan is definitely in order. The budget passed last year was based on the erroneous assumption that the government would collect $5.6 trillion more in tax money over 10 years than it had previously committed to spend. Even the Democrats were arguing in favor of cutting taxes then by as much as $700 billion.

Then came the economic downturn, deepened by the attacks of Sept. 11. Then came the billions of dollars in new spending for defense, homeland security, clean-up and recovery from the attacks, and more -- such as the pork-laden farm bill. Then came the stock market plunge, prompted in part by fraudulent bookkeeping, which cost investors their life savings.

The government is now expected to wind up about $157 billion in the red this year -- and to run short of funds for most of the remainder of the decade, even if no spending plans are added. Adding a drug benefit to Medicare, fighting a war in Iraq or helping states with drought relief all would send the government deeper into debt.

In the short term, deficit spending helps a faltering economy. In the long term, it threatens the nation's financial security.

Democrats haven't been any bolder than Mr. Bush in uniting behind a long-term solution to roll back tax cuts for the richest Americans. But they don't have the White House. He does.

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