What vanishing surplus?

The Republicans try to ignore budget woes, while the Democrats plot to pin the tail on the elephant.

By Jake Tapper

Published September 6, 2001 12:01PM (EDT)

As Senate Democrats and Republicans convened in their respective caucuses to discuss life, liberty and the vanishing budget surplus, each side took on positions worthy of philosophical contemplation.

For the Democrats, who control the Senate by one vote, the question is: If we act as if there's a huge crisis but refrain from trying to solve it, can we be blamed for it?

Republicans, on the other hand, seem to wonder: If we act as if there's no problem at all here, is there in fact a problem?

Senate Majority Leader Tom Daschle, D-S.D., reiterated Tuesday that Bush did not intend to use the "trust fund dollars" set aside for Social Security for any other kind of spending. But the recent, oft-mentioned study by the nonpartisan Congressional Budget Office reported that the federal government has already dipped into $9 billion from the Social Security budget surplus this year. So how is Daschle going to ensure that his nightmare doesn't happen?

That's not my table, says Daschle. "It is my hope that the administration, [and] our Republican colleagues who passed the budget and who passed the tax cut, will provide us with guidance on how to avoid using the trust fund," he said Wednesday.

So how about those Republicans who passed the budget? What's their solution to the disappearance of a surplus of dollars to fund the priorities President Bush has asked for, like a new prescription drug entitlement for seniors, a national missile defense shield, $34 billion in tax credits for energy companies, $18.3 billion in additional defense spending, an expanded health program for poor children, greater education spending, and on and on?

"The good news is, we have a budget that we can live with, have been living with," Minority Leader Sen. Trent Lott, R-Miss., told reporters. "It will provide adequate funds for our priorities. It will require some setting of priorities, but we're prepared to do that."

Sen. Peter Domenici, R-N.M., ranking Republican on the Budget Committee, then spoke up, saying, "The American budget is in great shape, great shape." He said that the president's request for an additional $18.3 billion in defense funding could be met within the budget, which he had told the GOP caucus would be done by finagling different appropriations outlays.

"I did receive my $600 check yesterday in the mail," Lott added, referring to the tax cut refunds. "And it's always exciting when you are told that the check is in the mail and you actually get it."

The sight of senators from one party crying "Fire!" but refusing to leave the theater, and those from the other party knee-deep in floodwaters pretending to have planned all along to go for a swim was quite jarring.

"Both Democrats and Republicans are feeling their way around," allowed one Senate GOP leadership aide. "The battle's just beginning." Republicans plan to emphasize that the size of the Social Security trust fund, funded by payroll taxes, depends on the state of the economy. Thus, Lott and the Senate GOP plan on pushing for further tax cuts and credits to encourage growth.

Which will thus increase the size of the Social Security trust fund.

"The trust fund is really the American economy," is how Domenici confusingly explained this. "What we're engaged in here is a lot of rhetoric," he added, with no one leaping to argue with him. The nation, in its 14th month of an economic slowdown -- "none of which is the president's fault," he emphasized -- is the problem. Not the budget.

Countered a Senate Democratic leadership aide: "Bush's budget, Bush's tax cut, Bush's problem."

"President Bush dug a hole and we're all in it," said Sen. Chuck Schumer, D-N.Y. "The onus is on him to figure the way out of it." Schumer pointed out that no matter how much Bush blames Congress for overspending, the two emergency appropriations bills and the budget bill Congress has passed included "not one nickel more than the president requested."

"All of us are between the 'save Social Security first' rock and the hard place of the need for programs like prescription drugs," Schumer said.

But Schumer's friends on the other side of the aisle don't see the tax cut as any sort of problem.

"If we had had hindsight when we wrote the tax cut, the tax cut would be bigger, not smaller," said Sen. Phil Gramm, R-Texas.

Fine, say the Democrats, whose polling indicates that while the tax cut was popular, it doesn't fare as well when voters are given the choice between it and other priorities such as paying down the national debt or providing seniors with a prescription drug benefit.

For their part, Republicans kept emphasizing that the slowdown had begun long before Bush loaded up the truck and moved to D.C. The caucus meetings in themselves were far more pleasant than the fights both sides are gearing up for assuredly will be. The Republican caucus meeting, held in the Mike Mansfield Room, was described as "more of a back-to-Congress" type session by one individual in the closed-door meeting. Lott announced his new grandchild; Sen. Kay Bailey Hutchison, R-Texas, was congratulated on her adopted 4-month-old daughter Kathryn. Kudos was given to Gramm and Sen. Jesse Helms of North Carolina, both of whom recently announced that they would not seek reelection in 2002. Gramm stood to thank everyone and remind them that he wasn't going anywhere for 15 months.

Domenici stood to inform his colleagues that he thought he had found a way to meet Bush's additional defense appropriation request, and that he thought the budget -- if not the economy -- was in great shape.

At the Democratic caucus meeting, held in Lyndon Johnson's old Senate majority leader's office, Sen. Barbara Boxer, D-Calif., played a recording of an interview she gave a local radio station. Appropriations Committee Chairman Sen. Robert Byrd, D-W.V., one of the few old-timers left, stood and described his Tuesday meeting with Vice President Dick Cheney, who requested that the Senate pass the education and defense bills first to ensure that they receive full funding. Byrd, described as seeming a tad indignant, relayed that he resented the White House's placing blame for the current fiscal dilemma on the Congress, and said that he told Cheney that he had no business telling the Senate in what order it should pass its appropriations bills.

Soon the discussion turned to the matter at hand: The missing intern ... or rather, the missing surplus. Though there are those in the Democratic caucus who want to spend, spend, spend, and there are those who preach more New Democrat-y fiscal responsibility, the one thing everyone could agree upon was that, in the short run, Bush should be made to feel the heat for the fiscal decisions he's made. After all, any possible solutions will bring heat as well.

"There are lots of pitfalls for us," Schumer said.

How long Democrats can maintain this posture is unclear, said the Democratic Senate leadership staffer. But internal polls indicate that the American people hold the GOP responsible for the government right now, despite the Senate's falling into Democratic hands in June, and the decision was made to let this current fiscal situation sit with the people, simmering as it will with the economic slowdown.

After all, according to a CBS News poll released Wednesday, Bush is being held responsible for the lagging economy. His approval rating, at 50 percent, is at its lowest point. A plurality of Americans, 48 percent, think the economy is getting worse. Sixty-six percent of those polled -- and 80 percent of seniors -- don't want the government invading Social Security coffers for unrelated activities, which is precisely what Bush's budget is doing. In good news for Bush, only 17 percent of the American people blame Bush for the disappearing surplus. The new Democratic strategy is clearly aimed at driving this number up.

One Republican Senate staffer compared the Democrats' attitude to the budget dilemma to how the Republican-controlled Senate handled former Clinton administration Energy Secretary Bill Richardson's acknowledgement in February 2000 that the Clinton administration had been "caught napping" when it came to the rise in oil prices. Republican senators discussed coming up with ways to solve the problem, but ultimately decided to point the finger of blame at the Clinton White House and let them deal with it.

Richardson, of course, had acknowledged that there was a problem. Bush's response so far to the current situation has been to feign that everything's fine, to the point of evasiveness. Asked on Tuesday if he pledged to veto any appropriations bill that taps into the Social Security trust fund, Bush said, "I say definitively every Social Security recipient is going to get their check." As Trent Lott might say, it's always exciting when you're told that the check is in the mail and you actually get it.

Jake Tapper

Jake Tapper is the senior White House correspondent for ABC News.

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