Rumors of large budget cuts began swirling in May 2004 when a White House budget memorandum warned government agencies that if Bush won reelection, his 2006 budget would seek cuts in education, veteran’s affairs, environmental protection, and urban development. While on the campaign trail, Bush boasted of his administration’s commitment to education and veteran affairs but his 2006 budget is expected to reduce the funding for the Department of Education to $1.5 billion from $1.7 billion, and cut Department of Veterans Affairs expenditures back below the 2004 level.
In an effort to restore what White House Chief of Staff Andrew Card called “very, very strong discipline,” the Women, Infants and Children nutrition “would be cut by $122 million. Head Start, the early-childhood education program for the poor, would lose… 2.5% of its budget…The $78 million funding increase that Bush has touted for a homeownership program in 2005 would be nearly reversed in 2006 with a $53 million cut [and the] National Institutes of Health spending would be cut 2.1%.”
Major funding for the Department of Housing and Urban Development (HUD) will also be withheld. Most of the HUD programs will be moved into the Labor and Commerce departments forcing them to “compete for resources in Commerce and Labor budgets that are not likely to expand to accommodate the shuffle.” HUD could lose as much as a quarter of its $31 billion budget.
HUD’s $4.7 billion Community Development Block Grant Program (CDBG), which helps establish program clinics, recreation centers, day-care facilities, literacy programs and housing development could be cut by as much as 50%. All the while, skyrocketing housing and property values will likely create greater demand for CDBG grants.
Meanwhile, to avoid Democratic opposition, Budget Committee Chairman Senator Judd Gregg, Republican of New Hampshire “is laying plans to institute a procedure that would make it harder for Democrats to block benefit cuts.” Since the Budget Committee sets spending limits for other Senate committees, Gregg will “attach language to this year’s budget resolution instructing the committees with jurisdiction over some of the entitlement programs to cut them.” The subsequent cuts will be packaged within a single “reconciliation” bill which, unlike ordinary legislation, cannot be filibustered by Senate Democrats. Thus, Gregg’s plan “would allow senators to approve budget cuts with a simple majority, rather than the usual 60 votes.”
President Bush’s 2006 budget, scheduled for delivery on February 7th, will not include the estimated $2 trillion cost of privatizing social security. The University of Chicago estimates that under Pan II of the President’s Commission to Strengthen Social Security (CSSS), private financial management companies are slated to collect $940 billion. Wall Street firms raised millions for Bush’s reelection campaign and have since “begun meeting with Congressional and White House staff members, pushing the idea that [Social Security] private accounts are not only good for the country but also good for business.”
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