News Release

February 4, 2002

Discretionary Spending for 2003: Bush to Exceed Clinton by $124 billion

WASHINGTON – The Bush administration proposes $789 billion of discretionary spending in FY 2003, according to new budget figures released today. That figure is $124 billion, or 19 percent, greater than the $665 billion that President Clinton proposed for fiscal 2003 in his final budget two years ago (see Chart 1). Discretionary spending includes defense and non-defense spending that is annually appropriated.

By examining past federal budgets, Cato's director of fiscal policy, Chris Edwards, found that planned discretionary outlays for FY 2003 have taken a large jump upward in each of the past four years.

"In his FY 1999 budget, President Clinton proposed discretionary outlays of $595 billion in FY 2003. The new Bush proposal of $789 billion for FY 2003 (including the Emergency Response Fund) is a stunning $194 billion or 33 percent more than Clinton proposed four years ago. This pattern of increases indicates a chronic overspending problem by the federal government.

"While upward revisions in the defense budget this year were predictable, large jumps in both proposed defense and non-defense outlays have occurred every recent year (see Chart 2). For example, last year Bush proposed FY 2003 non-defense spending of $390 billion, but now he is asking for $410 billion in FY 2003.

"While the federal government did show spending restraint in the mid-1990s, the first balanced budget in 29 years in 1998 seems to have triggered Congress and the administration to begin a spending spree. This is why quickly returning any budget surpluses as they arise to citizens through tax cuts is an important way to control the size of the government."

Chart 3 shows that upward revisions in federal spending have occurred nearly across the board. For example, in his last budget Clinton proposed FY 2003 education and training spending of $61.5 billion (budget function 500). Last year, President Bush bumped that figure up to $66.5 billion. Now Bush proposes spending on this function for FY 2003 of $70.5 billion.

"Going forward, President Bush's proposal to limit non-defense discretionary spending to 2.2 percent on average for the next five years won't happen unless he gets tough with Congress and vetoes appropriations bills that exceed his targets," says Edwards.

"If these spending increases continue, Bush is in danger of being remembered as a big-spending president rather than a tax-cutting president."

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Edwards is available for comment at 202-789-5252. Bill Niskanen, chairman of the Cato Institute, is also available for comment at 202-789-5236.