White House Budget Director Seeks Federal Budget Reductions To Help Offset Hurricane Costs
White House Budget Director Joshua Bolten in an interview with the Wall Street Journal said he has been instructed by President Bush to find cuts in the federal budget in light of spending to provide relief to Hurricane Katrina survivors, an exercise that could lead to spending reductions for federal benefit programs. Bolten said, "Other mandatory spending has to be on the table beyond [the cuts] in the budget resolution" Congress approved earlier this year.
The Journal reports that Bolten "declined to be specific about budget cuts he will seek, beyond calling on Congress to accept Bush's earlier proposal to eliminate 150 programs and deliver on the budget resolution vow to find $35 billion in savings from Medicaid" and other benefit programs over the next five years. According to the Journal, federal costs related to hurricane relief could total $200 billion.
Bolten called mandatory spending programs "fruitful places to look" for offsetting hurricane costs, which he declined to estimate. Bolten ruled out tax increases to pay for the disaster, saying, "A shift from the president's tax policy -- which would mean imposing a tax increase -- would jeopardize ... economic growth."
According to the Journal, Republicans "have been shouting" for Bush to "lead the search for offsetting spending cuts elsewhere," and "some Democrats have been shouting for Mr. Bush to abandon his quest to make earlier tax cuts permanent." Bolten added that a tax increase of any kind would be "retrograde."
Bolten also said he expects there to be no interest in delaying the Medicare prescription drug benefit, which is scheduled to be implemented on Jan. 1, 2006. He added, "It's not something I think Congress will find particularly attractive" (Wessel, Wall Street Journal, 9/26).