Managing prosperity

If the Congressional Budget Office is correct, the federal government will realize a whopping $4.3 trillion in budget surpluses over the next decade. This presents the United States with an unprecedented opportunity to put its fiscal house in order. Republican presidential candidate George W. Bush believes that this is the people's money, and that the surplus should be returned to them. The Democratic nominee, Al Gore, insists that the government can do a better job spending this money, and where it gives money back to the people, it should do so to further its policy goals. Bush's plan is to give much of the surplus -- essentially, the difference between what people and corporations pay in taxes and what the government spends -- back to the American people. His $1.3 trillion across-the-board tax cut, as Gore has repeatedly said, would go overwhelmingly to the richest Americans, who also now pay the heaviest share of taxes and would continue to do so; the plan would also remove many poorer Americans from the tax rolls. His spending plans are modest in comparison to the vice president's, focusing on pet issues like education and military preparedness. Gore plans to use the surplus as a tool of social policy. Tax breaks, instead of being across the board, would be targeted to those bearing the costs of health insurance, long-term care and college tuition. Money would help create retirement accounts for poor people, also furthering Gore's social policy goals, and domestic social spending in areas like the environment and education would receive substantial boosts. Gore has also pledged to use much of the surplus to pay down the government's $3.6 trillion in publicly held debt, the interest on which currently consumes more than a dime of every federal budget dollar. Gore would then invest those savings in Social Security and other programs. Bush has made no pledge to make substantial debt repayment a priority. Of course, the good times may not last forever. Congress is already eating into future surpluses, and should the economy falter, the projections may never materialize. Should that be the case, a commitment to tax cuts today may actually increase the national debt down the road. For voters, the issue comes down to whether they want the government to give its surplus back to them or to spend it on programs and pay down the national debt.

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