“Republicans in the House, the Senate, and the White House have failed to pass a budget resolution, failed to extend pay-go and spending caps, or any budget enforcement measures, failed to raise the statutory debt ceiling, and failed to pass appropriations bills in time to avoid a continuing resolution. Today, they add another failure to their list. Today is the statutory deadline for the Mid-Session Review, and this report, required by law, is missing and unaccounted for.
“Why the delay in the Mid-Session Review? Last February, OMB deliberately over-estimated the deficit for fiscal year 2004. Why do such a thing? Two reasons. For the long run, this jacked up the beginning estimate of the deficit, which helped the White House claim that could cut the deficit by half over five years. For the short run, this allowed the White House to use the Mid-Session Review to claim that the deficit is declining, the fiscal situation is improving. But the bottom line of the Mid-Session Review is still the biggest in history. There’s no other way to cut it, or make it seem like good news. The fact of the matter is, the deficit will climb to another high this year, and end up at least $50 billion above last year’s record-high level, which was $375 billion.
“Republicans control the House, the Senate, and the White House, but they cannot control the budget. And today is just another example of fiscal mismanagement.
“Not only will the 2004 deficit be higher than the 2003 deficit, but the 2004 deficit will be considerably worse than what OMB projected the 2004 deficit to be in 2001, 2002, and 2003. The fiscal situation has deteriorated steadily under this Administration.
“As bad as their projected deficits appear, actual deficits after 2004 are likely to be worse, because OMB projections always omit some big items. The FY 2005 budget request, which predicted record deficits in February, failed to include the full cost of the war in Iraq and Afghanistan, or revision of the alternative minimum tax, or the revenue impact of extending expiring tax cuts, or realistic discretionary funding. When it’s finally issued, we expect the Mid-Session Review to set new deficit records, but we also expect it to leave out a lot of big-ticket items, so that deficit looks better than in fact it’s likely to be.
“Before the Bush Administration is allowed to claim that the deficit for this year, which we put at around $425 billion, is an improvement, better than the deficit projected, remember that–
C At $425 billion, this will be the largest deficit in American history.
C At $425 billion, this deficit will be $50 billion worse than last year’s deficit.At $425 billion, this deficit is $675 billion worse than the deficit projected in 2001, when the Bush budget with tax cuts was passed.
C At $425 billion, this is the unified deficit; with including the Social Security surplus, it’s a deficit of $600 billion.
C The deficit is also four percent of the GDP and about five percent of the GDP, if the Social Security surplus is not counted.
C At $425 billion, it exceeds by $40 billion all domestic discretionary spending, excluding homeland security.
C At $425 billion, it is about $25 billion less than all defense spending.
C About 55 percent as large as all individual income taxes.
C About 85 percent as large as all Social Security benefits.
C Almost half again as large as Medicare spending.
“So, where is the missing Mid-Session Review? It’s being held back because it can’t be called an improvement. It will be issued, but later when it’s likely to draw less scrutiny.”
Excerpt from today’s briefing by White House Press Secretary Scott McClellan:
QUESTION: The White House typically on July 15th sends off to Congress the mid-session review of the budget. Why didn't that go up today?
MCCLELLAN: Well, actually, if you look back over history, I think 15 out of the last 25 have actually not necessarily been on that timetable that has been set out. We will be ready to announce that once everything is ready and we will do so at that time.
QUESTION: But I guess what I'm wondering is why isn't it ready. I mean, despite what's happened in previous...
MCCLELLAN: Well, the Office of Management and Budget is continuing to pull everything together and make sure that they have an accurate report. And then when it's ready, they will be talking about it more at that time.
But, like I said, you pointed out that traditionally, it has been at this time, and I want to point back to the fact that 15 of the last 25 have actually been after that timetable, a deadline that has been set.
Facts from the House Budget Committee Democratic Staff:
The Clinton Administration delivered its Mid-Session Review on time in every year when there was not an on-going negotiation with the Congress over a reconciliation bill. The Mid-Session Review was on time in every year except 1993, 1995, and 1997. In keeping with prior practice, the Clinton Administration believed that it made more sense to wait to deliver a Mid-Session Review that could incorporate the on-going reconciliation bill.
In two of the three reconciliation years, the Clinton Administration delivered summary tables on the state of the budget on time, by the statutory due date of July 15. In 1993 and 1995, the Clinton Administration sent the Congress updated information on the state of the budget by the due date, with notice that the full Mid-Session Review would follow.
In 1995, although the negotiations dictated that budget assumptions and estimates be updated, the Clinton Administration delivered a Mid-Session Review very close to the due date. President Clinton was responding to the on-going negotiations by updating his budget proposals. Still, the full Mid-Session Review in that year was delivered on July 28, less than two weeks after the due date. (Note that numerical tables had already been sent to the Congress on July 14.)
In 1997, although the Mid-Session Review was late, the Congress and the President were already in active bipartisan negotiations. Furthermore, the Clinton Administration notified the Congress on the due date that the Mid-Session Review would be delivered after the negotiations concluded and would incorporate the bipartisan agreement.
But let’s get to the heart of the matter: The Clinton Administration was reducing the deficit, and the deficit was getting better in each of the eight years when President Clinton was in office. President Bush has espoused policies to make the budget worse, and the deficit has gotten larger in every one of his four years in office. President Clinton had nothing to hide. This year, with none of the extenuating circumstances that applied in 1993, 1995 and 1997, the Mid-Session Review is not on time.