Current Events
The Economic Policy Institute Says that a Compassionate, Sensible Government is on the Chopping Block
Economic Snapshot April, 2004
Debate over long-term budget policy tends to neglect spending on critical functions of government such as education, the environment, enforcement of federal laws, infrastructure, and new technology for medical care and manufacturing. Such "non-security discretionary" (NSD) spending effectively receives lower priority in budget procedures. For example, administration budget documents this year emphasize specific budget commitments on deficits, taxes, entitlements (such as Social Security and Medicare), defense, and homeland security. Sustaining its commitments in all those categories of the budget would require that the last remaining budget category, spending for NSD purposes, absorb all the adjustment.
The squeeze on NSD spending-currently 3.7% of gross domestic product-would be more apparent if the administration produced the customary 10-year budget numbers instead of just the five-year budget numbers that it has provided. The 10-year numbers consistent with administration policies paint a disturbing picture, especially given that the administration has argued in favor of making all the 2001 and 2003 tax cuts permanent. The green line in Figure 1 shows revenue as a share of GDP with the 2001 and 2003 tax cuts made permanent. |