Senate chair takes hard line on budget resolution

Senate Budget Committee Chairman Kent Conrad, D-N.D., continues to take a hard line on enforcing the fiscal 2002 budget resolution, telling reporters Thursday he will insist that any new tax cuts or spending not already provided for in the budget be paid for - including legislation to eliminate the sunsets in the $1.35 trillion tax package and the $18 billion fiscal 2002 defense increase Secretary Donald Rumsfeld just sent to Congress.

On Wednesday, House Budget Committee Chairman Jim Nussle, R-Iowa, said he wants to hear Rumsfeld's rationale for the $18 billion increase before releasing the money, but did not specifically call for the amount to be offset.

"It's reality time," Conrad declared at the close of Thursday's Budget Committee hearing on the size of the available budget surplus. "The results are clear for anyone to see who has the courage to look. We're in trouble [and] the prospects are that it's only going to get worse."

Conrad pointed out that right now, there is very little available surplus outside of the Social Security and Medicare trust funds for FY02, and none in FY03 through FY07, using CBO's May baseline, the Joint Tax Committee's scoring of the tax bill, the policy assumptions in the budget resolution and the FY02 defense increase the administration just submitted.

That picture is only likely to worsen when CBO releases its mid-session review in August, he added, because economic forecasts are increasingly negative.

Conrad said the situation appears bleaker still, accounting for yet other pressures on the budget such as the bipartisan consensus for increasing spending on education and extending expiring tax breaks, along with GOP efforts to pass additional tax cuts and eliminate sunsets in the $1.35 billion tax cut package just enacted.

In addition to insisting that additional tax cuts or spending beyond the $661.3 billion allocated for FY02 be paid for, Conrad said he will be equally tough in exercising the authority the budget resolution grants him as chairman to release money from seven of the eight reserve funds it created.

Under the budget resolution, the chairmen of the Budget committees can tap into the various reserve funds only if doing so would not involving dipping into the Medicare Hospital Insurance trust fund surplus. And when CBO's August economic forecast is released, Conrad said he fears there will be no surplus left outside of the Medicare trust fund.

A 60-vote majority of the Senate could vote to overrule Conrad. That stricture does not apply to the $300 billion over 10 years set aside for Medicare reform and creation of a prescription drug benefit, because Republicans--who controlled both chambers when the budget resolution was written--believe the Medicare surplus should be available to pay for Medicare reforms, while Democrats insist those trust fund surpluses be reserved to pay for existing benefits, and that any reforms or new benefits be paid for out of the general fund.