Wolf D. Fuhrig

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02-09-03

Budgeting For War During Recession

Regardless of whether the ongoing struggle against terrorists and the regime of Saddam Hussein escalates or subsides, the high price Americans pay for the actions of their leaders is most evident in the details of the federal budget. If Congress agrees with Defense Secretary Rumsfeld, his Department will get $399 billion, or 17 percent, of the $2.23 trillion budget for 2004. The 4.2 percent increase over the previous budget does not include at least $30 billion for the ongoing war on terrorism and at least $100 billion for the anticipated war on Iraq. An additional $17 billion goes to the Energy Department's nuclear weapons programs.

Contrary to earlier plans, the Pentagon wants all three next-generation fighter plane programs funded. $544 million are to be spent on working the kinks out of the accident-plagued V-22 Osprey, the Marine Corps' helicopter-airplane hybrid. Eleven new Ospreys included in the budget will cost another $1.1 billion. Wherever possible, former air force pilot Rumsfeld hopes to take more pilots out of planes. For the new, unmanned Global Hawk high-altitude surveillance plane, he wants $610 million, and $275 million for the development of an attack drone. He also requests 14 more unmanned Predator reconnaissance aircraft at $250 million a piece.

$7.7 billion are again being allotted for the development of missile defense, both ground- and space-based. For $1.5 billion each, the Air Force is to get 11 more C-17 transport planes and the Navy another aircraft carrier. Let's not forget that the IRS needs to collect $1 million dollars 1,000 times to come up with just $1 billion.

The State Department's budget requests also reflect changed priorities in response to the threat of terrorism. As part of the programs to counter anti-American attitudes, non-military foreign aid is to be increased to $12.5 billion. Roughly $250 million are earmarked for improved security at American embassies. $30 million are to create a Middle East Television Network, while the funds for the Voice of America to Indonesia are to be doubled. A new program, the Millennium Challenge Account, reflects the President's strong belief that aid to developing countries should be tied to progress in the kind of political and economic reforms he approves. Whether any governments of poor countries will want to compete for the projected $1.3 billion in American handouts for improved behavior remains to be seen. Mr. Bush is certainly to be commended for allotting $2 billion as America's contribution to combating AIDS in Africa and the Caribbean, as well as for designating $1.2 billion to research on environmentally sounder hydrogen-powered cars.

While America's homeland defense will have to make do with $24 billion, Israel's Sharon government has no qualms asking Americans for $12 billion in aid, more than ever before, and $400 million more than the $11.6 billion budgeted last year for all other aid-receiving countries world-wide. The budget for 2004 provides no funds for the Iraqi opposition. "I'm not too worried," the Washington adviser to the Iraqi National Congress commented, "we'll be in Baghdad by then."

Even though hundreds of non-military programs will be squeezed, the federal deficit will still rise to an estimated $304 billion in 2004, and to $1,008 billion, i.e., $1.08 trillion, within five years. In fairness to the President, it has to be acknowledged, that the terrorist assaults on the World Trade Center and the Pentagon saddled him with a burden no other president has ever faced. In the Middle East, however, he aggravated the anti-American mood by his failure to be even-handed and use America's power to end the Israeli-Palestinian conflict.

Under Mr. Bush's watch, federal tax revenue has fallen two years in a row, for the first time since the early sixties. Tax cuts and the demise of Saddam dominate the President's wishful thinking. While the end of Saddam's regime is surely within his reach, the success of his tax cuts is anything but certain.