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Jewish World Review Sept. 4, 2001 / 5 Elul, 5761

Michael Barone

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That four-letter word --
GEORGE W. BUSH has returned to Washington, still talking about the need to set a new tone and for bipartisan cooperation. But the success of his fiscal policies, not just this year but for his entire term, may be determined by how deftly he uses a four-letter word that he has been reluctant to utter in public: veto.

Democrats, especially Senate Majority Leader Tom Daschle, have made it plain they will fight him down the line. They seem to be trying to force him into a position in which he will abandon his 10-year tax cut next year, just as his father was manipulated by Senate Majority Leader George Mitchell into abandoning his read-my-lips-no-new-taxes pledge in his second year in office. Their tactic for the moment, decrying the dwindling surplus and arguing that Bush would dip into the "Social Security surplus" (as both parties did for 30 years), makes little sense as policy: Surpluses should dwindle when the economy slows. Democrats stop short of calling for repealing any part of the tax cut (though House Minority Leader Dick Gephardt sounded as if he were doing so in an interview with the Des Moines Register). Daschle's strategy is to hold the education and defense appropriation bills to the end of the session, then argue that Bush is robbing retirees and schoolchildren to pay for arms, then perhaps to put a squeeze on the tax cut.

Much more than this year's budget is at stake. At issue is the size of government. The purpose of Bush's tax cut is to hold down government's share of the gross domestic product at around 18 percent. Democrats would like it up around 20 to 23 percent, where it was from 1975 to 1997. For the past three years, Congress and Bill Clinton increased domestic discretionary spending by an average of 8 percent. Bush wants to hold that down to 4 percent. That will be greeted by cries that vital needs will not be met, that old people and small children will suffer. The mainstream media (which constantly identified Bob Packwood as a Republican when he was hit by scandal but almost never mentions that Gary Condit is a Democrat) will give plenty of play to stories that help Democrats.

A credibility test. But life in America is not going to be materially affected if spending doesn't rise 8 percent a year. In fiscal years 1995 and 1996, domestic discretionary spending actually fell, and life in America went on just fine. Voters re-elected the incumbent Democratic president and the Republican House. The reasons for the spending drops in the mid-1990s and the 8 percent increases in recent years are political. In the mid-1990s, Speaker Newt Gingrich took control of the appropriations process and ordered spending cuts; Clinton used his veto to force spending up, but only a bit. In recent years, Speaker Dennis Hastert has deferred to appropriators, whose natural tendency is to spend more. Disputes between Hastert and Clinton were solved by giving everyone more money.

Now Bush can use the veto to change the politics of spending once again. The way is simple: keep his word and veto any spending increase over 4 percent except for education and defense-4.1 percent and you're out. Of course there is a tension between Bush's calling for bipartisan cooperation and threatening vetoes. Presidential counselor Karen Hughes reportedly argued against even using the word "veto" in discussions about the HMO regulation bill (called by its backers the patients' bill of rights).

And Bush himself weakened the credibility of threatening a veto last spring when he laid down several markers for signing any campaign finance legislation, and he let it be known a few weeks later that he would sign pretty much anything Congress passed. He had a good tactical reason: He knew many House Democrats didn't want the campaign finance bill to become law and would vote for it only if they were confident it would be vetoed. But as a result, when Bush laid down markers for HMO regulation in June, the Senate blithely ignored them.

But in the last week of the summer session, Bush restored the credibility of his veto. Rep. Charlie Norwood, a Georgia Republican, switched from his preferred HMO bill to a compromise with Bush because, he said, Bush would veto Norwood's version. Bush's version passed the House. In the Senate, Iowa Democrat Tom Harkin wanted to bring home a $7.4 billion farm bill in time for the recess. But he grumbled and settled for $5.5 billion after Bush said he'd veto anything higher.

So when Congress reassembles, Bush can do what Clinton did with great success-threaten to veto bills if they don't meet his specifications. Bush likes to say he works with members of both parties. But the fate of his long-term economic program depends on whether he is willing to veto bills members of both parties support. His remarks when Congress recessed and just before he returned to Washington suggest he is. We'll see.

Michael Baone Archives

JWR contributor Michael Barone is a columnist at U.S. News & World Report and the author of, most recently, "The New Americans." He also edits the biennial "Almanac of American Politics". Send your comments to him by clicking here.


©2001, Michael Barone