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CNN Live At Daybreak

Battle For the Bush Budget Begins

Aired February 05, 2002 - 05:07   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: The need to fund the war on terror has increased the stakes of this year's budget battle in Washington, and it's always a battle, isn't it?

CNN White House Correspondent John King reports.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CORRESPONDENT (voice-over): The president opened the budget battle focusing on what he calls priority one, paying for and winning the war on terrorism.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's proved that in this first phase that expensive precision weapons not only defeat the enemy, but spare innocent lives. And the budget I submit makes it clear we need more of them.

KING: The new Bush budget proposes spending $2.1 trillion in the fiscal year that begins in October. The Pentagon would get the largest one year increase in two decades, $48 billion to $379 billion in all. And spending on homeland security would nearly double to $38 billion, with an emphasis on airport and border security and fighting bioterrorism.

Other key Bush priorities include $591 billion in new tax cuts and credits. One with a price tag of $32 billion would allow taxpayers who do not itemize deductions to get credit for charitable contributions. Another costing $4.2 billion would help parents pay for private education if their children leave failing public schools.

But some domestic spending would be cut and overall funding for programs other than the military and homeland defense would grow at just two percent on average. The White House says the squeeze is necessary, that supporting the troops and winning the war requires tough decisions elsewhere in the budget.

But Democrats say key domestic priorities like health care and job training suffer under the president's plan. Democrats also say Mr. Bush is dipping into Social Security money, that he wouldn't have to were it not for last year's big tax cut.

SEN. KENT CONRAD (D), BUDGET CHAIRMAN: The hard reality is his long-term fiscal plan did not add up before September 11. It's been made worse by the events of September 11. KING: Democrats also note the bottom line, after four years of budget surpluses, the Bush budget projects a deficit of $106 billion this year and $80 billion in red ink next year. The White House notes past times presidents also have been forced into deficit spending.

(on camera): Presidential travel is one element of the early Bush budget strategy, as the president tries to rally the American people to see things his way in a wartime budget battle all the more complicated by this fall's congressional elections.

John King, CNN, Eglin Air Force Base, Florida.

(END VIDEOTAPE)

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