Military

DATE=03/10/03

TYPE=U-S OPINION ROUNDUP

TITLE= FEDERAL DEFICIT

NUMBER=6-12855

BYLINE=ANDREW GUTHRIE

DATELINE=WASHINGTON

EDITOR=ASSIGNMENTS

TELEPHONE=619-3335

INTRO: With the prospect of a war with Iraq looming ever closer, several American papers are beginning to place the costs of military action in a broader perspective. They worry that the growing federal deficit, reversing a trend of federal surpluses in recent year, may seriously accelerate when the full costs of a war, and post-war rebuilding are known. We get a sampling now from ______________ in today's U-S Opinion Roundup.

TEXT: Two of President Bush's most important plans, a possible war in Iraq, and a major tax cut to stimulate the economy, are coming under increased journalistic scrutiny. Several papers worry that the costs of both the war and the tax cut will exacerbate the already fast-growing budget deficit. That in turn, they theorize, will hold back an already faltering U-S economy from normal growth. We begin our sampling with this rather pessimistic view from The Washington Post, which titles it: "Digging the Deficit Hole."

VOICE: The deficit numbers grow ever grimmer. The Congressional Budget Office [CBO] on Friday [3-7] put out a new estimate for this [current] fiscal year in which the projected deficit is 24 percent higher than the CBO had anticipated [only] two months ago, mostly owing to the faltering economy. Meanwhile, Congress this week will begin outlining . federal spending and tax cuts that would push the country further into a deficit hole. So it seems like an opportune moment to pause for a reminder of how we got into this mess, how bad it is and how bad it could be if President Bush's tax wishes come to pass.

First, what happened to the surplus? It was only two years ago that the CBO foresaw a surplus of five-point-six-trillion dollars through 2011. . Now, even without new tax cuts, the surplus has evaporated and the administration is airbrushing [Editors: sarcastic slang for "changing" or "rephrasing"] its previous statements. . [And] these figures don't take into account the likely increases in spending to cover an Iraq war and its aftermath, homeland security or a prescription drug benefit for seniors.

TEXT: Equally worried about the deficit because of several other bits of dismal economic news is Iowa's largest daily, The Des Moines Register.

VOICE: Nearly 300-thousand jobs disappeared last month as unemployment levels rose again. . Gasoline prices were projected to hit record highs in April. Recessions almost always follow big increases in energy prices. The Congressional Budget Office once again revised the deficit projections upward . to . $287-billion this year and a record $338-billion next year. That's not counting the cost of a possible war with Iraq.

TEXT: The gloom has reached all the way to Florida, where The Orlando Sentinel sounds remarkably like The Washington Post.

VOICE: The Congressional Budget Office piled bad news on bad news last week. Blaming the sluggish economy, the CBO raised its estimate for this year's federal budget deficit by 50-billion dollars from its last projection just five weeks ago. If only the White House were concerned. President . Bush is still pushing [Editors: "advocating"] his ten-year 674-billion dollar tax cut as if there's money to burn in Washington. In projecting the first-ever 300 billion dollar deficits this year and next, the White House assumed the president's tax package would pass. But those numbers don't include the price of a war with Iraq .

Unless the president and Congress recommit themselves to balancing the budget, the federal government will be forced to borrow huge amounts of money - - more than one-trillion dollars over the next six years - - at a time when it should be saving to prepare for the huge burden that retiring baby boomers will place on Social Security and Medicare starting in the next decade. . Congress can start by turning the president down on his latest tax-cut proposal.

TEXT: Missouri's St. Louis Post-Dispatch looks at the situation from another angle, the rising cost of gasoline [petrol], which is also adversely affecting the economy.

VOICE: The price of oil [recently] . hit 39-dollars-99-cents a barrel - - a 12-year-high - - before retreating a bit. OPEC's oil wells are pumping nearly flat out [Editors: slang for "at maximum capacity"], and cartel officials told The Wall Street Journal that they can no longer lower the price by pumping more. The failure of America's energy policy is now on full display. Four of the last five American recessions included a spike in energy prices. If prices stay at this level, America's slowpoke recovery could well grind to a halt. We could face another dismal year of rising unemployment, plunging stock prices and economic malaise.

TEXT: On that gloomy assessment from The St. Louis Post-Dispatch, we conclude this sampling of editorials concerned about the nation's immediate economic future.

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