OMB director says deficits are 'manageable'

The fallout over the Office of Management and Budget's new deficit projections continued today as OMB Director Joshua Bolten told the House Budget Committee that those deficits are "manageable" if spending is restrained, and that fighting the war on terrorism, protecting the homeland and growing the economy were more pressing priorities.

Bolten noted that without the tax cuts in each of the last three years, the fiscal 2003 deficit-now estimated at $455 billion-would still be $278 billion.

But Budget ranking member John Spratt, D-S.C., and other Democrats continued to press the case that most spending increases over the last three years-for defense, homeland security, airline relief and other post-Sept. 11, 2001, costs-have been agreed to by both parties and that tax cuts are the real culprit.

Budget Chairman Jim Nussle, R-Iowa, reiterated his claim that, beginning with the $1.9 billion 2003 supplemental request, lawmakers should find ways to offset costs not previously budgeted for. Bolten merely replied, "We'll be glad to work with you on that," but had no recommendations for offsets.

Appropriators argue offsets in the fiscal 2004 spending bills are not realistic, given already tight budget caps and underfunded homeland security and other needs.

The House Appropriations Committee could consider its version of the 2003 supplemental as early as Monday, and congressional leaders face no easy path to its enactment, given competing spending priorities. The Senate added $100 million for AmeriCorps to its version, and appropriators will be under pressure from House GOP leaders and the administration to keep it clean.