The Spend of Our Union Is Strong

According to President George W. Bush, "the State of our Union is strong and together we will make it stronger." To that end, the President appeared committed to making his tax cuts permanent and to make America more competitive. He once again proposed to reform Social Security. And in an effort to restore his Administration's long lost fiscal credibility, the President called on Congress to support a tough budget that reins in domestic spending.

And in fact, Bush's speech contained some proposals about controlling the size of government. For instance he said "This year my budget will […] reduce or eliminate more than 140 programs that are performing poorly or not fulfilling essential priorities." He added "I am pleased that Members of Congress are working on earmark reform because the Federal budget has too many special interest projects. And we can tackle this problem together, if you pass the line-item veto."

Some skepticism is warranted. In his State of the Union 2001, he said, "We have two choices. Even though we have already met our needs, we could spend the money on more and bigger government. [But] unrestrained government spending is a dangerous road to deficits, so we must take a different path." Yet, that same year total spending increased by 8 percent compared to 4 percent the previous year under President Clinton. The administration argued that homeland-security and defense spending drove much of the increase. But the data show that in FY2002 spending increased in all areas. Defense discretionary outlays rose by 14 percent and nondefense by 12.5 percent.

In his State of the Union 2002, Mr. Bush said, "To achieve these great national objectives -- to win the war, protect the homeland and revitalize our economy -- our budget will run a deficit that will be small and short term so long as Congress restrains spending and acts in a fiscally responsible way." That year, spending increased another 7.3 percent with discretionary spending up a whopping 12.5 percent.

In 2003, Bush explained, "The best way to address the deficit and move toward a balanced budget is to encourage economic growth and to show some spending discipline in Washington, D.C." Yet that year Congress jammed the Omnibus bill with 8,000 earmarked pork projects -- such as $150,000 for the Rock School in Philadelphia and $250,000 for the Call Me Mister program at Clemson University -- and the President failed to veto the bill.

In 2004, the president underlined that "This [fiscal discipline] will require that Congress focus on priorities, cut wasteful spending and be wise with the people's money. By doing so, we can cut the deficit in half over the next five years." But he did not veto the spending bill even though Congress added $37 billion to his proposed budget.

Finally last year, the President told us, "America's prosperity requires restraining the spending appetite of the federal government." Accordingly, he did propose to cut 150 wasteful government programs potentially saving taxpayers $16 billion. Unfortunately, Congress only agreed to cut $6 billion. Yet the president didn't oppose or even threaten to oppose the bloated spending bill.

So when Mr. Bush says that this time he is really committed to fiscal responsibility, one should be only cautiously hopeful. Especially since he then proceeds to undermine his own rhetoric by proposing a list of over two dozen new or expanded spending initiatives.

Here are some of the new spending items:

  • New funding for the Advanced Energy Initiative -- a 22-percent increase in clean-energy research at the Department of Energy to:
    • promote the development of alternative fuel for automobiles
    • subsidize 'high risk' energy research and development
    • promote the construction of new nuclear power plants
    • advance the development of ethanol
    • advance the development of fuel made from the waste part of plant crops.

  • The American Competitiveness Initiative to encourage innovation throughout our economy by:
    • doubling the federal commitment to basic research programs in the physical sciences over the next ten years.
    • making permanent the research and development tax credit.

  • Increase funding to train 70,000 high school teachers, to lead advanced-placement courses in math and science.

  • Fund 30,000 math and science professionals to teach in classrooms and give early help to students who struggle with math.

  • Add resources to encourage young people to stay in school.

  • New funding to states to end waiting lists for AIDS medicine in America.

  • Nationwide effort with African-American churches and faith-based groups to deliver rapid HIV tests to millions

After the State of the Union address one is left wondering and conflicted: President Bush's tax agenda is good news for the American people. Reforming Social Security would also be good for workers and retirees. But in order to maximize the economic benefits of these policies, the President needs to put our money where his mouth is and deliver on his budget promises. Is he willing to do that?

Veronique de Rugy is a research fellow at AEI.