Budget freeze

House Republicans want to protect the president's tax cuts, but have refused to offset them with cuts in government spending.

How far off base is the conservative Republican economic agenda? Consider its critics. Former Sen. Jesse Helms, once considered the most conservative member of Congress, says in a draft of his memoir that he wouldn't have voted for the recent tax cuts knowing what he does now about the growing federal deficit. "Not too many people will criticize a tax cut, but it's going to be costly," he wrote.

Former Republican Sen. Warren Rudman, a noted fiscal conservative, said a majority of his party's members of Congress find themselves "between a rock and a hard place" because they have chosen to promote tax cuts over budgetary constraint. Wall Street isn't happy, either. The long-term outlook for the federal budget is "grim," said Goldman Sachs economist Ed McKelvey, who added that "policymakers should not wait for the markets to sound the alarm on deficits."

No wonder congressional Republicans are frozen in inaction on this year's budget resolution. A chance to move forward died when House Republicans refused to go along with the Senate's "pay as you go" rules. With the support of four moderate Republicans, the Senate voted to require any future tax cuts to be offset by equivalent cuts in spending or increases in other taxes.

That would be the responsible way to budget now that the deficit is expected to balloon to $450-billion by the end of the current fiscal year. Over the past three years, President Bush has pushed through $1.7-trillion in tax cuts with no constraints on spending.

Even Helms now recognizes that those tax cuts, which mostly favored the wealthy, were misguided. "Too often, presidents do things that don't end up helping the people they should be helping, and their staffs won't tell them their actions stink on ice," Helms wrote, with his customary candor. Excerpts from the memoir were published in Business North Carolina magazine.

While some of the tax cuts could be justified to stimulate the economy, the deficit is now the major concern, threatening to rob the government of its ability to meet coming obligations. You wouldn't know that listening to most House Republicans, whose only motivation is to protect the tax cuts as they come up for renewal. Rather than raise taxes, Congress should shrink government, they argue, although neither party has shown any inclination to do so. As the Washington Post pointed out, even if Congress eliminated every penny in the budget for domestic discretionary spending (for such programs as education, health, homeland security and interstate highways), the nation would still be in debt.

By promoting tax cuts to the exclusion of budgetary responsibility, congressional Republicans find themselves not only stymied, but also far from their conservative roots.

[Last modified July 1, 2004, 01:00:36]