Projected Surplus Supports Tax Cut, Bush Says

President Bush, previewing the budget he will send to Capitol Hill in three days, said Saturday that a projected 10-year surplus of $5.6 trillion is enough to support modest boosts in spending and still pay for his cherished tax cut.

The projection of a decade of black ink, still a novelty in federal budget cycles, relies on the bipartisan Congressional Budget Office, which this month predicted the surplus--$1 trillion higher than any previous estimate--if tax and spending levels remain unchanged.

But there is virtually no possibility that the no-change assumptions underlying those projections will be met. Bush reiterated his call for a $1.6-trillion tax cut over 10 years, and said his budget for the coming fiscal year will increase spending by 4%, slightly more than the expected rate of inflation.

Democrats also are proposing a tax cut, although about half as large as the Bush plan and targeted to the less affluent.

In dueling Saturday radio addresses that set the parameters for the year’s budget and tax debate, Bush and Iowa Gov. Tom Vilsack, a Democrat, disagreed about the reliability of the surplus forecasts and about how to spend the money.

“The federal budget is a document about the size of a big-city phone book and about as hard to read from cover to cover,” Bush said.

“The blueprint I submit this week contains many numbers. But there is one that probably counts more than any other: $5.6 trillion. That is the surplus the federal government expects to collect over the next 10 years, money left over after we have met our obligations to Social Security, Medicare, health care, education, defense and other priorities,” the president said.

Asserting that a surplus means “taxpayers have been overcharged,” Bush said that his plan “returns about one out of every four dollars of the surplus to the American taxpayers.”

Bush plans to send a summary of his $1.9-trillion budget to Capitol Hill on Wednesday following his Tuesday night address to a joint session of Congress.

Despite Bush’s wry description of the size of his budget, administration officials say the document he will submit Wednesday is a slim volume that sets priorities but lacks details, which the new administration has not had time to develop. Bush expects to send the massive budget books to Capitol Hill in April.

While Bush described the 10-year surplus projection as the key number in the budget, Vilsack’s response for the Democrats said it would be dangerous to assume that the money will materialize.

Sounding a bit like Republican budget-watchers of years past, Vilsak said, “Fiscal responsibility dictates we should be somewhat cautious about relying on [surplus projections] in making decisions, because those figures are estimates for a 10-year period. . . . If we overcommit on tax cuts, what happens if we have a recession? Do we want to risk going back to the days of record deficits, like those during the Reagan-Bush years, which led to a growing national debt?”

But Bush said there is plenty of money available to do all that he thinks the government should do.

“My budget blueprint will restrain spending yet meet growing needs . . . ,” the president said. “After paying the bills, my plan reduces the national debt and fast--so fast, in fact, that economists worry that we are going to run out of debt to retire. That would be a good worry to have.”