Copyright 2000 The Chronicle Publishing Co.
The San
Francisco Chronicle
FEBRUARY 8, 2000, TUESDAY, FINAL EDITION
SECTION: NEWS; Pg. A1
LENGTH: 2181 words
HEADLINE:
Clinton Budget Makes Big Promises;
Large share of spending set aside for
California
BYLINE: Carolyn Lochhead, Chronicle
Washington Bureau
DATELINE: Washington
BODY:
President Clinton released his final budget
yesterday, a $1.84 trillion policy agenda filled with goodies
for vote-rich California but unlikely to do more than frame the debate between
Republicans and Democrats in an intensely political election year.
Clinton's budget calls for spending much of the projected 10-year budget
surplus, estimated by the White House at $746 billion, on
bolstering Medicare and Social Security. At the same time, it promises to pay
off the $3.7 trillion publicly held debt by 2013.
The
central element in Clinton's budget is a new prescription drug benefit for
Medicare, to cost $160 billion over 10 years, along with an
additional $35 billion program for seniors who have especially
high drug costs.
Clinton's budget also would provide sharp spending
boosts for a vast array of federal programs, from Head Start and farm aid to
conservation and education, and provide a net tax cut of $170
billion over 10 years.
White House officials said about a dozen of Vice
President Al Gore's proposals were written into the document.
"Government and public life are more than rhetoric," Clinton said. "The
reality eventually makes a difference. The specific decisions do count, and
that's what this budget is all about."
Republicans quickly dismissed
Clinton's plan as a "lame-duck spending spree" aimed at aiding Gore's
presidential bid, while Democrats like California Sen. Dianne Feinstein hailed
it as "right on track with the major concerns of the American people."
Given the tight partisan divisions in both the House and Senate, it is
unlikely that Clinton's budget will be passed in anything resembling its current
form.
Nonetheless, the document represents Clinton's opening bid for
debates over everything from Medicare to the military as both parties struggle
to win control of Congress and the White House in November.
ITEMS FOR
CALIFORNIA
Although the president's budget does not break down spending
state by state, it does offer some big items that would disproportionately aid
California, including an 11 percent increase for border control and
$15 million to buy more than 200,000 acres of private land
inside the Mojave National Preserve.
Feinstein said that when combined
with Congress' purchase last year of 225,000 acres in the Mojave, the land buy
would "mark the largest such acquisition in the history of the continental
United States."
The budget also calls for additional money to preserve
ancient sequoias in the Sierra Nevada as part of a $1.4 billion
"Lands Legacy" program to help states and local governments buy property for
everything from wildlife protection to suburban greenbelts.
Clinton
economic adviser Gene Sperling called Lands Legacy "the greatest effort to save
natural resources since President Teddy Roosevelt." The initiative includes big
increases -- $93 million -- for coastal protection and a
$10 million increase for marine sanctuaries.
The
proposal so pleased environmental groups that Defenders of Wildlife called it
"something akin to the Holy Grail for the environmental community."
California transit projects would receive $242 million,
including $80 million for BART's extension to San Francisco
International airport and $12.2 million to complete the Santa
Clara Tasman light-rail project.
AIDS treatment and prevention programs
would get several substantial increases: an additional $125
million for the Ryan White CARE act providing treatment and
services to people with AIDS and HIV, bringing total funding to
$1.7 billion; a $66 million increase to
$795 million for the Centers for Disease Control to prevent HIV
infections both here and abroad; and a $26 million increase for
the AIDS Drug Assistance Program (ADAP), to $554 million.
The National Institutes of Health would receive a $1
billion increase, to $18.8 billion, including an increase of
$105 million for AIDS research, bringing the total to
$2.1 billion.
PELOSI PUSHES FOR HIV FUNDING
Rep. Nancy Pelosi, D-San Francisco, called the AIDS budget "a reasonable
start," but said Democrats "must fight for funding above the president's
request, especially in ADAP, which pays for life-saving drugs for people with
HIV who cannot afford to pay for the drugs on their own."
Clinton also
called for tens of millions of dollars in federal spending to "promote the
e-commerce revolution," including previously announced plans to spend
$50 million to help poor households get computers and Internet
access, along with $19 million to "help small manufacturers
become e-commerce ready."
In addition, the administration wants
$23 million to "install broadband technology in rural
communities and distressed areas" for high-speed Internet access.
Clinton is also calling for $13 million in new money to
"track the growth of e-commerce" to help "guide us in deploying our resources
for this e-commerce revolution," according to Commerce Secretary William Daley,
along with $28 million in new funding to historically black
colleges for science and engineering training.
INCREASE FOR BORDER
PATROL
On immigration, the administration proposes a nearly
half-billion-dollar increase for the Border Patrol to hire 430 new agents,
increase their pay and otherwise intensify border surveillance. States would get
additional money as well to offset the costs of imprisoning illegal immigrants
who have committed crimes.
The Immigration and Naturalization Service is
also proposing a voluntary "Premium Service Fee" program, in which businesses
could pay $1,000 to guarantee 15-day processing for immigration
applications.
The budget also includes $181 billion in
tax increases, including a 25-cents-per-pack cigarette tax hike and corporate
tax increases. Republicans quickly dismissed these as "dead on arrival."
GOP House majority leader Dick Armey accused the administration of
trying "to have it both ways, increasing spending and trying to pay down the
debt." GOP leaders said they would write their own budget that also protects
Social Security and pays down the debt but provides bigger tax cuts and less
spending.
GOP TAX CUT LIKELY BIGGER
Republicans are expected to
use a larger projection of the 10-year, non-Social Security surplus than
Clinton's $746 billion, one based on lower spending
projections, thus carving out room for a bigger tax cut.
GOP leaders
have already begun work on a 10-year, $182 billion tax cut for
married couples in order to reduce the so-called marriage penalty, a plan the
White House said is too large.
Both sides would put aside the excess
payroll taxes collected for Social Security, which are expected to amount to
$2.2 trillion over the next 10 years. That money is credited to
the Social Security trust fund, but because the trust fund is an accounting
device, the actual money goes to pay down the national debt.
Clinton
would, in addition, credit to Social Security the interest savings from a lower
debt and credit an extra $300 billion in projected surplus
general revenue to Medicare. The way by which Clinton can give a sharp boost to
Medicare and promise to pay down the debt is because the money credited to the
Medicare trust fund actually goes to retire federal debt.
While reducing
the national debt will make it easier for the government to finance retirement
benefits in the future, many budget analysts warned that relying on projected
surpluses to bolster the program trust funds avoids reforms that would prepare
for the huge retirement demands of the Baby Boom generation.
Although
Social Security reform was a hot topic last year both at the White House and in
Congress, nothing ever came of it. This year, with huge budget surpluses
projected on both sides, the impetus for reform has all but evaporated.
------------------------------------------------
MAJOR BUDGET
PROPOSALS
Highlights of President Clinton's proposed budget:
.
CHILDREN, WOMEN and FAMILIES
-- $573 million
more for the Child Care and Development block grants to states to help 150,000
more children.
-- $1.4 billion over 10 years in tax
credits for businesses building or expanding child care programs for workers.
-- $130 million more to programs helping low-income
families make the transition from welfare to work.
--
$27 million to help close the wage gap between men and women.
.
EDUCATION
-- $39-billion education
budget plan, roughly 4 percent more than last year's proposal, to wire
classrooms for the Internet, hire more teachers, fix crumbling schools and make
college more affordable.
-- $30 billion for college
tuition tax relief.
-- $181 billion in tax increases
over the next decade, including a 25-cents-a-pack cigarette tax increase and
attempts to curb abusive corporate tax shelters.
.
TAXES
-- $351 billion in tax relief, including
$45 billion in relief from the "marriage penalty,"
$54 billion for new retirement savings accounts,
$32.7 billion in relief for the middle class from the
alternative minimum tax and credits or deductions for child care, long-term
health care, charitable giving, college costs, school construction and
inner-city development.
.
IMMIGRATION
--
$4.8 billion for the Immigration and Naturalization Service, a
record.
-- $523 million in new initiatives, including
hiring 430 additional Border Patrol agents, adding 115 immigration inspectors at
land borders and 154 at airports, and financing 1,000 new detention bed spaces.
.
DEFENSE
-- $277.5 billion for
modernized weaponry, better benefits for soldiers, global peacekeeping missions
and a big jump in spending on weapons and equipment.
--
$1.9 billion for a limited national missile defense system.
.
HEALTH CARE
-- $110 billion over 10
years to reduce the number of Americans without health insurance by 5 million.
-- $100 million in 2001 and $6.5
billion over 10 years to give states options for expanding Medicaid coverage for
legal immigrants, pregnant women, the disabled and people who leave welfare
rolls to take jobs.
-- $2 billion for AIDS-related
research. Also, $125 million under the Ryan White Act to
provide treatment for low-income AIDS patients, $40 million in
new funds for state and local AIDS prevention programs, and a total of
$342 million spread among different agencies to help fight HIV
around the world, an increase of $100 million.
.
MEDICARE
-- $160 billion to create a
prescription drug benefit for the elderly, which would pay half of senior
citizens' drug bills.
-- $8 billion over 10 years to
let people ages 55 to 64 who lack health insurance buy into the Medicare
program, now limited to those 65 and older.
.
SOCIAL SECURITY
-- $160 billion in 2001 and $2.2
trillion over the next decade to pay down the national debt. Clinton wants to
earmark for Social Security future income tax surpluses that would otherwise
have been used to pay interest on the debt.
.
TECHNOLOGY
-- $1.46 billion to protect America's most important
computer networks, including $500 million on research to help
develop tools to track down hackers and cyberterrorists.
--
$100 million for as many as 1,000 "community technology
centers" where people without computers could visit to use the Internet, plus
$50 million for a new grant program to buy computers and
Internet connections for low-income families.
------------------------------------------------
CHART:
PAST AND PROJECTED BUDGETS
Here is a look at the projected increases in
budget surpluses under President Clinton's proposal for the
2001 budget.
Received: $2.34 trillion
Spent: $2.13 trillion
.
.
-- $1.84 trillion --
-- Where it comes from:
Individual income taxes 48%
Corporate income taxes 10%
Social Security, Medicare tax receipts 34%
Other 4%
Excise taxes 4%
.
-- Where it goes:
Spending 91%
Surplus for Social Security
and debt reduction 9%
.
-- Breakdown of spending:
Social Security 23%
Non-defense discretionary 19%
Defense discretionary 16%
Medicare 12%
Net interest 11%
Medicaid 7%
Other mandatory 6%
Other entitlements 6%
.
Source: Office of Management and Budget 1996
.
Associated Press Graphic
GRAPHIC: PHOTO (2), CHART: SEE END OF TEXT,
(1) Jim Hearn and Jenny Winkler, senior analysts for the Senate Budget
Committee, checked Clinton's plan. / New York Times, (2) Clinton's
$1.84 trillion budget includes plenty for California /
Associated Press
LOAD-DATE: February 8, 2000
