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August 24, while he was still on vacation in Texas, George W. Bush
addressed the then-raging question of whether the government should
spend the estimated $157 billion Social Security surplus on anything
other than repaying the national debt. "I've said that the
only reason we should use Social Security funds is in case of an
economic recession or war," the president said.
Who knew? At
the time Bush spoke, administration officials had begun to make
the case that the country might not have to technically be in a
recession — that is, to have suffered from two quarters of
negative economic growth — in order to spend Social Security
funds. Now, with the focus shifted from recession to war, there's
no question those funds will be spent.
One of the
after-effects of last week's terrorist attack has been the breaking
of what had once appeared to be an unbreakable political deadlock
in Washington. Until the morning of September 11, Republicans and
Democrats were desperately trying to out-promise each other as they
pledged never to spend money from the Social Security surplus. By
the administration's count, the 2001 surplus was projected to be
$158 billion, with $157 billion of that coming from Social Security.
The projected surplus for 2002, according to the White House's numbers,
was $173 billion, with $171 billion coming from Social Security.
Under that scenario, the government would have to stay within carefully
defined spending limits to have any hope of not dipping into the
Social Security surplus.
Now, those
numbers are all out the window. "Obviously we're going to spend
the Social Security surplus," says one senior Capitol Hill
aide. "The question is, are we going to constrain that spending
to a direct response to the terrorist acts, or are we going to open
that up and say we'll move money into areas that are not directly
related?"
Bet on the
latter. Last week, when members of Congress approved a $40 billion
supplemental appropriation in response to the attacks, they were
not only giving the president money to fight terrorism, but also
giving themselves permission to spend in ways that might not have
been possible before September 11.
For example,
before the attacks President Bush had sent a request to the Hill
for $18 billion in defense spending above and beyond the budget
resolution. There were some in Congress who wanted to use part of
that money for non-defense purposes like education. "That would
have been a huge fight," says the congressional aide. Not any
more. "Now, it becomes easier to take some of that money and
use it for non-defense and take the difference out of the supplemental
we just did," the aide says.
Another example
is the agriculture appropriations bill, which is essentially finished
and ready for consideration by the full House and Senate. The bill
already contains provisions for enormous increases in spending,
and now there are worries that proponents will press for still more,
on the grounds that food is a national security issue. (While that
is undoubtedly true, the issue with which the agriculture bill deals
is not food scarcity but food overproduction.) Look for even less
spending discipline in the final result.
Both examples
serve as reminders that whatever happens on the terrorism front,
Congress must still pass the 13 appropriations bills that just a
few days ago promised to be the objects of bitter debate. It is
unreasonable to believe that those debates will not happen, even
considering the world-changing events of September 11. And the common
theme in those debates will be increasing spending. Privately, White
House officials say they are concerned over what is sometimes called
the "Christmas tree" effect, which is what happens when
all sorts of shiny and expensive projects are hung on spending bills
as they make their way through Congress. There will undoubtedly
be much of that in the coming weeks, including spending that has
nothing at all to do with last week's terrorist attacks.
And it will
be difficult, if not impossible, to stop, at least for now. "For
a while, it's going to be hard for people to stand up and oppose
anything," says one aide. "People like this sense of unity."
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