Commentary

Hey, Big Spender

By Veronique de Rugy and Tad DeHaven
This article originally appeared in Tech Central Station on March 26, 2003.

George W. Bush is increasingly being compared to Ronald Reagan. Democrats accost him for being like Reagan while Republicans praise him for it. It is a fact that like Bush, Reagan came to Washington with an ambitious plan to cut taxes across the board and increase defense spending while containing federal spending. President Reagan successfully lightened the tax burden on the American people, and oversaw a massive defense spending build-up. Given President Bush’s recent push for more pro-growth tax cuts combined with increased defense spending for the war on terrorism, the analogy is tempting. However, at this stage in his presidency, Mr. Bush’s dismal record on spending when measured against Mr. Reagan’s nullifies this temptation. Better yet, in light of President Bush’s spending it looks like it would be more accurate to compare him to Jimmy Carter than Reagan.

Let’s look at the facts. If we compare the three-year percentage change in real spending during Reagan and Bush’s first terms, President Bush comes out as a profligate spender on his own and as compared to Reagan. Under President Bush, real total outlays are estimated to increase by 13.5 percent as opposed to 6.8 percent under Reagan. More importantly, total real discretionary outlays are set to increase by 19.5 percent under the Bush administration while they increased by only 2.8 percent under Reagan.

And it gets worse. Discretionary spending is divided into two parts: defense spending and non-defense spending. When President Reagan pursued his defense buildup, he increased real defense discretionary outlays by 19.2 percent while cutting non-defense discretionary outlays by 13.5 percent. However, if estimates hold, President Bush will have increased real defense discretionary outlays by 21.2 percent-but non-defense discretionary outlays will have risen by 18 percent. Discretionary spending numbers are telling because they are determined in the annual appropriations process where the President has the most influence.

A cursory look at the real three-year percentage change in non-defense discretionary spending for selected budget categories during both presidents’ first term revels that President Reagan managed to cut spending in most budget functions. In contrast, Mr. Bush has not only failed to match Reagan in reducing spending, spending has actually gone up across the board- and often at exorbitant levels.

Three Year % Change in Real Discretionary Spending During Reagan and Bush’s First Terms (Selected Categories)
  Reagan Bush
International Affairs 1.6% 17.8%
Energy -42.5% 19.2%
Natural Resources & Environment -20.0% 6.9%
Science, Space & Technology 10.3% 7.9%
Agriculture -6.5% 4.3%
Transportation -10.9% 16.1%
Community & Regional Development -32.6% 31.8%
Education, Training, Employment & Social Services
-32.6% 26.8%
Health -15.6% 36.8%
Income Security 14.3% 10.3%
General Government 4.2% 29.1%
Source: Budget Of the U.S. Government, Historical Tables, Fiscal Year 2004

Presidents Reagan and Bush both inherited defense budgets that were inadequate for the threats facing the nation. As noted, both men sought-and won-substantial increases in defense spending from Congress. And, while providing for the defense of the nation is a defined responsibility of the federal government, most non-defense discretionary endeavors are not. Thus, it is Mr. Bush’s failure to limit government spending on these constitutionally murkier activities that remains his Achilles’ heel.

Of course, the argument can be made that it is unfair to lay excessive blame on President Bush for over-spending given that Congress technically controls the purse strings. A recent Heritage Foundation report shows that three out of the top five all-time federal spending sprees occurred from 2000-2003, 1999-2002, and 1998-2001 (the other two occurred during World War II). Thus, President Bush appears to have inherited a Congress with established spendthrift credentials.

However, this excuse is diminished by the fact that Bush has not vetoed a single spending bill during his time in office. Instead, he has agreed to sign every piece of legislation crossing his desk including a bloated farm bill and an intrusive education bill. In contrast, President Reagan vetoed 22 spending bills during his first three years in office.

In addition, President Bush has been the beneficiary of a considerably more favorable party arrangement in Congress. Although Republicans did control the Senate during Mr. Reagan’s first term, Democrats dominated the House-by a 100-seat margin at one point. President Bush on the other hand has had the luxury of a GOP controlled House and Senate (with the exception of a 5-month loss of control in the Senate to the Democrats when GOP Sen. Jim Jeffords left the party). While Mr. Reagan was sufficiently successful at taming a doubting and often hostile Congress, Mr. Bush has demonstrated a lack of conviction in tempering the spending desires of a comparatively receptive Hill.

While President Bush is obviously well aware of the benefits and the need to cut taxes as a way to trigger economic growth, the government continues to expand, bureaucratic programs blossom and no one talks about eliminating entire government departments anymore.

Veronique de Rugy is a fiscal policy analyst and Tad DeHaven is a fiscal policy research assistant at the Cato Institute.