February 2, 2004
Hi. It's great to be here on Ask the White House. I look forward to taking your questions. But first I want to congratulate my hometown team, the New England Patriots, for a big win last night.
J.D., from Oxford, OH
It seems that the President is often criticized about a lack of funding for
No Child Left Behind. Does the new budget provide higher funding levels for
Great question--I've heard that criticism too, and it sort of puzzles me. Since 2001, and including this year's proposal, the President and Congress have increased funding for K-12 education by 49%. The Budget the President transmitted today includes another $1 billion increase in funding to help low-income schools--that makes a 52% increase since 2001. And his budget proposes another $1 billion for special education programs--a 75% increase since 2001.
It's also important to remember, though, that the No Child Left Behind Act was about more than spending more money. The Act was about raising standards for students, holding schools accountable to parents and students for making sure students learn, and providing more choices to parents. And it's working.
Aaron, from Tarajkowski writes:
When the President says he plans to reduce the deficit by half within five
years, does that mean the current annual deficit or the full deficit that is
getting larger every year? For example, a 500 billion dollar annual
deficit after 5 years is now 250 billion. Or a 8 trillion deficit is now 4
trillion after 5 years? If it is the latter, which I hope it is, when is the
deficit going to start to go down? I have heard that his current annual
budget contains a large deficit.
Another good question. When we talk about the deficit, what we mean is the amount of money that the government spends in a given year above the amount of money it takes in from taxes and other forms of revenue. The deficit starts to go down with the budget the President proposed today. If Congress continues the sound economic policies in the budget--including making the tax cuts permanent--and exercises spending restraint, the deficit will go down starting in 2005, and will be cut in half by 2009.
Robert, from Ann Arbor, MI
Mr. Kaplan, does this year's proposed budget bring increased spending
back underneath the 4 figure and could you explain why that percentage is so
This year's proposed budget does bring what we call discretionary spending underneath 4%--for the second year in a row. Discretionary spending is the spending that Congress votes on each year to fund government's operations, and covers things like money for our military, for our border officials, and our schools. The President proposes to hold the number to 4% because he thinks government should grow no faster than the average growth in American family income. That 4 % number includes substantial increases to win the war on terror and protect the homeland, and holds the increase for non-security related spending to one-half of one percent--which is below the rate of inflation. With this kind of spending restraint and continued economic growth, we'll be on the path to cutting the deficit in half within five years.
att, from Brookline MA writes:
dude, joel... how great was that game yesterday? i thought the pats were
gonna blow 'em out, but carolina hung tough.. gotta give 'em a little
credit.. you're missing one heck of a pahty up here, you should come on up
i'll save a seat for yah..
I was pretty depressed that I had to work during the game--but I had it on TV. The budget is exciting too, though.
Carol, from Orlando, FL
There has been a lot of talk concerning the impact on the budget of adding a
prescription benefit to Medicare. What is the current cost projection?
The Congressional Budget Office estimated that the prescription drug benefit will cost $395 billion over ten years, which they confirmed again last week. In debating legislation, Congress relies on the Congressional Budget Office. Estimators at the Department of Health and Human Services estimate the cost will be $534 billion over ten years. These represent a reasonable range of estimates for this very complicated piece of legislation, and reasonable people will continue to disagree about the right number. Our budget shows us cutting the deficit in half within five years even using the higher number.
The President was pleased to sign the act because it helps to create a modern Medicare system, provides seniors with prescription drug coverage for the first time, and by introducing choice and competition in the system, should lay the foundation to bring down costs over the long run.
Anthony, from Woodstock, Georgia
With the economic growth figures being what they have been, have real
dollar receipts to the treasury increased along the same growth
percentages and given that to be true or false, does the OMB take into
account fiscal growth(increase in dollars to the Treasury from a growing
economy)for its annual projections or just for long term projections?
Treasury receipts fell off dramatically with the collapse of the stock market in the spring of 2000, and continued with the recession that was fully underway in early 2001. They are only now beginning to recover as the economy picks up steam, and we show an increase in revenues in fiscal year 2004 (the government calculates these things on a fiscal year that ends on Sept. 30). Our projections show that revenues continue to increase throughout the five-year budget window. Those improved revenues are critical to cutting the deficit in half. And what is most important in keeping those revenues strong is to make sure we don't allow taxes on America's families and business to go up, which they will if the tax cuts the President proposed and Congress enacted are allowed to expire. To bring the deficit down, we need to have strong economic growth AND spending restraint--the President's budget proposes both.
penny, from Washington DC
What is the proposed NIH budget?
The budget proposes $28.6 billion for NIH this year. This increase builds on the President's doubling of the agency's budget--a goal that was accomplished in 2003. The fiscal year 2005 budget will support a record total of nearly 40,000 research project grants, including 10,393 new grants. This is 285 more than last year, and the highest number of new grants ever awarded.
tristan, from carsonville mi writes:
hey joel is the president budget going to cut any veterans programs and
The President is firmly committed to honoring the veterans of our Armed Forces. The budget for veterans' medical care has grown by 41% since President Bush took office, including another proposed $1.2 billion in 2005 to support the Department's core medical care mission. Most veterans are getting better, faster care today than when the President took office. The Administration has also focused on cutting waiting times for veterans. When the President took office, some veterans were waiting six months for an appointment. By this spring, lines will be completely eliminated. The VA under Secretary Princippi has also shortened the time to process a veteran's disability claim--the average time has been reduced by 30% from its peak.
Lyndsey, from Redondo Beach, CA
What prompted the President's move to include $60 million in new funding to
expand the Clean School Bus USA program? How will this money be
Last year, Congress enacted $5 million for this program to help states and school districts upgrade school buses to reduce harmful diesel emissions. Twenty-four million students travel in school buses every school day. Most of these buses are diesel-powered, and some of them are very old. Diesel emissions have been linked to potential increased cancer risk and and particularly acute effects in individuals suffering from asthma or allergies. EPA received an overwhelming response to the program--120 applications for received totaling $60 million. Given the availability of relatively low-cost retrofit kits with the potential to achieve really dramatic emission reductions, the Administration decided to propose an additional $60 million this year. The money will be distributed on a competitive basis, with a preference for what are known under the Clean Air Act as "non-attainment" areas--or areas that have not reduced as much pollution as the law requires.
Richard, from New Jersey
Mr.Deputy I am wondering if you could explain how (w a 15 increse to the National
Endowment of the Arts,the Medicare Perscription Plan, and the incress in
national security spending,and all the other increases in spending but no
clear cut decreases in spending) we are to belive that are deficiet is going
to be cut nearly in half?
If the Congress enacts the budget the President sent up today--with its pro-growth economic policies and its fiscal restraint--we'll be able to cut the deficit in half. Even though there are increases in some priority areas, the overall increase in the non-security related discretionary accounts ("discretionary" is the spending that is voted on annually by the Congress) is limited to one-half of one percent, well below the rate of inflation. As the economy recovers, the Treasury will take in more money. If we can bring our spending down as the President has proposed, we'll be well on the way to cutting the deficit in half.
William, from Redding, CA
How can the Bush Administration justify increasing the defense budget by 7
especially missile defense by 9 billion when the country is running
deficits? How can these kinds of increases be sustained without causing
long term damage to the American economy?
The President's highest priorities are to win the war on terror, protect the homeland, and strengthen the economy. The President is committed to making sure our Armed Forces is the best-trained and best-equipped in the world, and to provide what it takes to defend America from attack. We can bring today's deficits down if we keep the economy growing with policies that promote investment and job creation, and if we restrain our spending and focus it on our priorities. That's what the President's budget does.
Sara, from Washington, DC
Joel, The next item on your schedule starts soon. It looks like you are having fun
on this, so I will definitely schedule you to do this again soon
P.S. You are a great boss
Thanks Sara. Please talk to me about a raise after we're through here.
Tim, from Washington, DC
How much do you think Canada weighs?
Hmm. Good question. I'll have to refer you to the Canadian Office of Management and Budget on that one.
Valerie, from Seymour writes:
Thank you for taking time to answer questions as we prepare for Budget
season. As a young professional, I am very interested in the future of the
LifeTime Savings accounts. What are the chances of this important piece of
legislation passing Congress and becoming law?
You're welcome--thanks for taking time to ask. The Lifetime Savings Accounts are a new concept that will give individuals a whole new opportunity for tax-deferred saving. The accounts allow an individual to earn tax-free return on deposit amounts and withdraw the funds as needed without paying further taxes and without facing a withdrawal penalty. This is money that can be used to save for retirement, but also for other needs--either unexpected emergencies or large, expected purchases like a home, a car, or a child's education. The President has also proposed Retirement Savings Accounts that would greatly simplify the tax treatment of individual tax-preferred savings opportunities. These proposals to increase private saving will expand the amount of investment owned by individual Americans and build the pool of savings needed for retirement. These are exciting new proposals good for working Americans, and we're hopeful that Congress will act on them.
Thanks for all the great questions. Hopefully I'll be invited back to do it again--maybe after the Red Sox win the World Series in October.