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Bush back in Washington, primed for budget tussle

President Bush is back in Washington on Thursday, likely to face criticism from Democrats on his proposed budget.  

WASHINGTON (CNN) -- President George W. Bush left Crawford, Texas, on Thursday -- wrapping up his month-long "working vacation" at his ranch -- and returned to Washington, prepared for a budget battle with congressional Democrats.

The president's Marine chopper touched down on the South Lawn of the White House at mid afternoon Thursday, bringing his vacation to a quiet close. Bush shook hands with onlookers before entering the executive mansion for he first time in 26 days.

Bush has indicated he is ready to fight to preserve his top priorities -- spending increases for education and defense, in particular. Those priorities, he cautioned on Wednesday, should be spared from "budget games and last-minute cuts."

CNN's Brooks Jackson takes an unusual look at the numbers game being played over Social Security (August 28)

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How Social Security works  
Message Board: Taxing and spending: Bush budget
White House Budget Report (pdf)
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 What's in a 'surplus'?
The U.S. figures its annual bottom line by including all tax revenues - including taxes that can only be used to pay Social Security benefits. If revenues fall short, the government has customarily borrowed from Social Security.

Here's the math behind the Congressional Budget Office prediction:

$153 billion = Total budget surplus
$162 billion = Off-budget surpluses*
$9 billion = Shortfall

*Includes Social Security trust funds as well as the net cash flow of the Postal Service

What's the impact?
If Congressional Budget Office estimates are correct and the government needs to borrow from the Social Security trust fund, here are the effects of the move:

  • Social Security benefits are not affected.

  • Money taken out of the trust fund would be credited to the Social Security account.

  • It could slow down the pace of paying off long-term debt.

  • Democrats, meanwhile, have steadily stepped up their criticism of the president's fiscal policies amid news of shrinking budget surplus estimates, and projections that money may have be skimmed off the top of the Social Security trust fund to cover this fiscal year's spending.

    "That's the old way of doing business, and it's time to stop it," Bush said Wednesday of the criticism, and the back-and-forth battling he expects when Congress returns from its summer break next week.

    As Congress returns and resumes work on the federal government's 13 annual appropriations bills, Bush instructed in his speech before the American Legion on Wednesday that the legislative branch's first order of business should be the defense and education budgets -- before any other spending priorities.

    Whether Bush can persuade Congress to follow his instructions, however, is in question. That's especially so in the Senate, where the Democratic leadership has expressed serious reservations about the president's proposals to boost education spending by $1 billion, and defense spending by $18 billion, in light of congressional projections showing a budget surplus of $153 billion for the year.

    That estimate, released this week, is down $122 billion from the Congressional Budget Office's last round of calculations, released in April.

    The president's Wednesday speech marked his first public comments since CBO released its budget projections, which also show the government will need to use money from the Social Security surplus to pay for $9 billion in other government spending.

    Democrats are assigning blame for the plunging surplus to Bush's budget policies -- including his $1.35 trillion tax cut. The White House, which disputes that Social Security funds need to be used, has argued the tax cut will stimulate the feeble economy, and Congress should rein in its own spending.

    Some Democrats have said the encroachment on the Social Security surplus will make it difficult to pay for some of Bush's priorities -- his defense wish list in particular.

    Sen. Majority Leader Tom Daschle, D-South Dakota, and other Democratic leaders responded to Bush's speech Wednesday by sending him a letter "to convey our serious concerns about the deteriorating condition of the federal budget and the nation's economy."

    They called on Bush to explain how the nation should pay for his defense, education and other initiatives in the wake of the tightening budget, and at the same time protect the Social Security and Medicare trust funds. "Although you continue to advance these proposals, your administration has failed to put forward any plan to reconcile these costs with the rapidly dwindling surplus," they wrote.

    A day earlier, Sen. Kent Conrad -- the budget committee chairman, and a co-signer of the letter, singled out the defense budget as an area of particular concern. Conrad, a North Dakotan who said he supports more money for defense, nonetheless questioned how the budget could afford the $18 billion boost.

    "He wants an additional $18 billion that is not in the budget. And my question to him is, this is spending you say is needed. How do you intend to pay for it?" Conrad told reporters.

    In his Wednesday speech, Bush indicated he would put up a fight against any move to scale back his proposals, especially on military spending.

    "We recognize it's a dangerous world. I know this nation still has enemies, and we cannot expect them to be idle," he said. "That's why security is my first responsibility, and I will not permit any course that leaves America undefended."

    The president also touched on some of the other priorities he will pursue this fall. They include items left over from Bush's agenda before he left for his Texas getaway at the beginning of August -- his faith-based initiative to grant federal funds to religious organizations that provide charitable services; an HMO patients' bill of rights; and an education bill.

    "I return to Washington tomorrow ready to make my case, and ready to work with folks on both sides of the aisle," Bush said.

    • The White House

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