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.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It represents compassionate conservatism. It's a budget that sets priorities.
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BILL PRESS, CO-HOST: Tonight, President Bush releases his budget. Is it a compassionate spending plan? Did he cut too much to pay for a big tax cut?
ANNOUNCER: Live from Washington, CROSSFIRE. On the left, Bill Press. On the right, Robert Novak. In the CROSSFIRE: Congressman Tom Davis of Virginia, chairman of the National Republican Congressional Committee and in New York, Democratic Congressman Charles Rangel, ranking member on the Ways and Means Committee.
ROBERT NOVAK, CO-HOST: Good evening. Welcome to CROSSFIRE. At long last, President Bush's budget arrived on Capitol Hill today. And that sobbing you heard were Congressmen weeping that their pet projects had been trimmed.
Actually, the Bush budget increases spending by 4 percent, and the year's total of $1.9 trillion in government outlays is no small change. But because the president wants a $1.6 trillion tax cut spread over the next 10 years and is boosting money for health, education and defense, some government programs are reduced.
So, is this budget dead on arrival? Or will the new president be successful in trying to ration congressional spending appetites? Bill Press.
PRESS: Congressman Davis, let me start right there. I mean, the question I ask is, who is kidding whom? The budget was released today, but today was just a press opportunity; the outline of the budget was around for a while. In fact, the Senate voted last week to cut the president's tax cut by 25 percent, to increase spending from the 4 percent in his budget to the 8 percent in his budget.
So, this budget is not dead on arrival, this budget was dead before it even got there, wasn't it?
REP. TOM DAVIS (R), VIRGINIA: Actually, this budget passed the House basically, when you take a look at the tax cut and the spending limitations, so you have the House and the president aligned with the Senate. It now goes to a conference committee. I wouldn't call it dead at this point.
There's always some compromise as you work through the process, but the president will get most of what he wants.
PRESS: Well, I realize that the Republicans in the House acting as a rubber stamp for the president passed this budget. I'm talking about the more deliberate body -- they're in the Senate -- where they voted (UNINTELLIGIBLE).
But what surprises me, you seem optimistic and so does the president, but he has done nothing, like for the last two months, except go out on the road, trying to sell this plan of his. He's been to 15 states. In 12 of those states, Congressman, he was out there targeting democratic senators; he went to those states trying to get those democratic senators to vote for his plan.
Do you know how many he got out the 12? Zero. Not one. Which led Senator Daschle to say this in terms where he thinks this budget will end up, if we can shift to Senator Daschle here for just a second.
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SEN. TOM DASCHLE (D-SD), MINORITY LEADER: I'm quite confident that you can't go much higher than where we are right now and try to sustain any kind of a majority vote in the Senate. So I think we're about where we need to be, and I would caution them about whatever notions they have about going much farther than where we are right now.
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PRESS: So, despite what you did in the House, this budget and this tax cut will be paired down roughly to where the Senate and...
DAVIS: That's Senator Daschle and I appreciate you taking his line but yet, two-thirds of the alignment, the president and the House at a much higher number. I don't know what happens when it gets into Congress -- and I quit predicting what the Senate would do a long time ago.
But it -- the amount that passed the Senate was a pretty strong majority; you can use a lot of those members. You only need 50 members plus one to pass this, and I think it will; how much is impossible to tell.
NOVAK: Congressman Charles Rangel, welcome. A lot of us simple folk don't understand how it is that full percent increase over and above inflation is a spending cut. But I want to, you know -- and the Senate went for a 7 percent increase over inflation. I want to -- I would like you to listen what Secretary of Treasury Paul O'Neill had to say about that today.
(BEGIN VIDEO CLIP) PAUL O'NEILL, TREASURY SECRETARY: What the Senate did last week in providing for a 7 percent increase makes the point that we've been making all along: if we don't send the money back to the people, there will be people here who will spend it.
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NOVAK: And you are one of them, aren't you, Mr. Rangel?
REP. CHARLES RANGEL (D-NY), WAYS & MEANS COMMITTEE: You know, there is all point alert out for this compassionate conservative. I didn't understand why the House and Senate Republicans fought so vigorously to get the tax cut passed before they put out the budget.
But if you take a look at the blood that's on the floor as a result of the cuts in this program, it makes a heck of lot of political sense. The truth of the matter is, that these programs that the president has campaigned on, are people's program.
This whole concept of give the money back to the people, let -- and don't let the Congress spend it, we have an obligation to protect Social Security, the president talked about protecting Medicare, prescription drug, education, the environment, all of these things are not just the growth of spending reduced. But these programs are being cut.
In New York City, the money that's going to be available to help teach our doctors to take care of the sick and the infirmed is going to be reduced; you have to realize one thing: you have inflation and two, the population and the people to be served have grown.
NOVAK: All right. All right. That's a point -- of course, increasing overall health spending and you know that Mr. Rangel, but the question I have for you is: what is enough? You know, 7 percent increase in the Senate was not what the Democrats wanted in the Senate. They wanted more. You say the country is growing. What would you like, a 10 percent increase in spending, so you just tax the hell out of Americans?
RANGEL: You know, we have an obligation to pay down the national debt. That's not a Democratic Party debt. We have an obligation to keep up and improve the quality of education and our environment and to strengthen our defense.
You know, when you talk about spending money, it's not as though we are buying a new car or a new pair of shoes. these are things we have to protect. The Republican plan, what they do, is to try to reduce the revenues, so when the money is not there, good and solid programs which don't have the political courage to abolish, we either are forced to reduce them, or run out and ask for a tax increase. When we do that, then you say, all we want to do is tax and spend.
PRESS: Congressman Davis, everybody agrees -- even liberals agree, that there's too much fat in government and there's always places to cut. The question is: where? The devil in the details. Here is how Senator Breaux, Democrat of Louisiana, put it yesterday on "This Week."
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SEN. JOHN BREAUX (D), LOUISIANA: When people see the budget, they're going to say, oh, my God, I wanted a tax cut, but I didn't know what you were going to do to health care and to Medicare and national defense.
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PRESS: On that point specifically: one of the cuts is money to train pediatricians and other doctors in children's hospital, cut 25 percent. How can a compassionate conservative justify that...
DAVIS: I think you need to understand, this is a talking document in terms of look, I won't go program by program with you. But the fact of the matter is, a 4 percent increase is above inflation and it's above the growth in population. He's added over 10 percent increase in the Department of Education; he's put more into reading; he's doubled the funding for NIH and cancer research. So, you're moving money around in some of these there.
But for health care, he's added more, and for prescription drugs, he's added $15 billion a year into those programs. What they are doing is recentering some of these programs, but it's not taking away from health care. I think they are giving their priorities, as long as Congress comes up something that is a 4 percent, I think he will sign it. That's where he's drawing the line.
PRESS: But -- with all due respect, I don't want to talk global numbers. People don't want to hear global numbers; they want to hear the specific programs, they want to hear the specific cuts. There is one: training for doctors and pediatricians in children's hospitals.
Let me give you another one: 100,000 new cops on the street; it's a program that's been around for three years. The rate of violent crime is going down in every major city in this country.
DAVIS: I would be happy to take that one, because, as you know, I was head of one of the largest counties in the country. The cops program, frankly, did not spend money that well. It only funds for the first three years. What the Bush administration has done is they've taken that money and put into school violence, putting police in schools. So they have transferred money from a cops program into permanent funding...
PRESS: So, they're taking cops off the streets and putting them in schools, that doesn't mean the streets are any safer!
DAVIS: But it's only a three-year funding mechanism any way.
NOVAK: Congressman Rangel, I could have predicted as the night followed day, that people like you -- not necessarily you, my friend -- but people like you would say that this budget is mean to children. The Democrats always talk about children. Now the answer to that canard came from the very distinguished secretary of the HHS, former governor of Wisconsin, who like you and me, likes children; let's hear what Tommy Thompson had to say:
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TOMMY THOMPSON, HHS SECRETARY: Now, I know there have been some reports and innuendoes that this budget may cut children's programs, so let me be crystal clear up front: this budget substantially increases the investments the federal government makes in children.
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NOVAK: Now, just on hard numbers, Thompson is right, isn't he?
RANGEL: Well, since you have your visual aids, the National Association of Children Hospital and the American Academy of Pediatricians have joined with members of Congress trying to prevent cuts in children's programs. They charge that the administration cut 35 million from a 235 million program for training doctors at children's hospital. So much for compassion, Bob!
NOVAK: I am going to give you compassion, Mr. Rangel, because I actually looked at the budget -- I don't know if you did, or if you just listened to the lobbying groups -- this budget increases -- increases -- 350 million to support child care, increases 67 million to support children from families where there's abuse, increases 189 million in -- for children that are not covered by other programs! Now as I read it, that is about $500,000 in additional money for children!
RANGEL: You know, Bob, I have noticed with you that when you are confused on the facts, you always raise your voice. I mean, Tom already explained -- already explained that it's shifting around. It's a shifting budget! So you found where there has been some slight increases...
NOVAK: Slight? Half-a-billion?
RANGEL: You don't talk about doctors that won't have the money to be educated to take care of these kids. You don't talk about moneys for the construction and rebuilding of low income housing. You don't even talk about what the U.S. chamber talks about, and that is the XM bank to help our manufacturers...
DAVIS: Corporate welfare. You're for corporate welfare?
RANGEL: We want to export, we want to create jobs, we want to improve the economy. And that's who all your clients are anyway, and they want it!
PRESS: All right, congressmen, we are going to take a break here. By the way, we want to inform you that Congressman Tom Davis is going to hang around and jump into our chat room this evening right after the show to take your questions. You can join him by logging into cnn.com/crossfire. And when come back, how successful will President Bush in getting rid of some of that fat, some of that pork, even though some of that pork are favorite projects of congressional Republicans.
PRESS: Welcome back to CROSSFIRE. President Bush has decided how he wants to spend our money, which has some members of Congress angry, because he doesn't want to spend money on their favorite projects. Will the president be successful in eliminating congressional pork? Just part of the battle over the budget tonight with Republican Congressman Tom Davis of Virginia, and Democratic Congressman Charles Rangel of New York, who is in New York tonight -- Bob.
NOVAK: Congressman Rangel, I heard so much weeping from the farm block members of Congress about the Agriculture Department being cut, and so again, I went to the fine print. And what I found in the budget was that the only thing that was eliminated, that was reduced, was 1.1 billion eliminated from a one-time welfare spending -- I mean, emergency spending for damage to the farm crops, and 218 million eliminated in unrequested earmarks. Unrequested earmark: that is a fancy word for pork barrel spending that you people asked for. Surely, you are not against those kinds of cuts, are you, Mr. Rangel?
RANGEL: Well, I am, because it's the farmers that's really one of our most productive industry. They're responsible for so much of our exports, and if we have to help them get it out of the ground and get it on the ships and planes overseas, that's what our job should be all about.
But what is ironic is that this so-called surplus, which when you owe over $4 billion is not really a surplus, but the money that we have beyond spending, comes from the payroll taxes. That is hardworking people, 70 percent of the people who work who pay the payroll taxes. Guess what? They get none of the tax cuts, and they are the ones that really are going to have the Social Security and Medicare trust fund raided in order to allow 40 percent...
RANGEL: ... top 1 percent.
DAVIS: Charlie, you know that is not accurate. You know that these trust funds are protected under the Bush budget, under the congressional Republican budget. In fact, we stopped the raid on Social Security that your party had for years routinely spent that money on defense and education and other items. But not one penny of the Social Security or Medicare trust fund is spent on anything other than deficit reduction over the next 10 years in this budget.
RANGEL: Let me ask you this, Tom: is not the total surplus coming from the payroll tax and not the income tax? Is that true?
DAVIS: No, you have... RANGEL: That's the total -- the total surplus is the money that is not being spent in the Social Security surplus! And what the Republicans have said, is that they're going to put it in the lockbox, but even in the budget, the $153 billion for Medicare has been put as a contingency fund, and it's supposed to be in the Medicare fund!
DAVIS: Well, Charlie, what you want to do is you want to get Social Security benefits to people, then you would not have them paying the Social Security trust fund. That is what you are saying.
RANGEL: I didn't say that at all! I didn't...
RANGEL: You don't have to cut the payroll tax. You can -- you expand earned income tax credit, and compensate for the moneys that they are spending for...
NOVAK: In all due respect, Congressman Rangel, what you are talking about has absolutely nothing to do with the question I asked you, and let me restate it. Going through this budget -- in every single department, there's money taken out of so-called unrequested earmarks. That's pork barrel projects that senior members of Congress have put in their district.
This is what John McCain was talking about all over the state of New Hampshire, this lousy pork barrel spending. Can't you at least agree with the president that these are not efficient and effective ways for using the taxpayers' money?
RANGEL: You know, a week ago, you were crying and complaining that estate taxes were running farmers and small-business people out of business. And now you are coming back saying we ought to knock the farmer because they're trying to get some federal assistance in staying in business! You can't have it both ways, Bob.
DAVIS: I think the reality is you will never end the earmarks, but if you stay within that 4 percent guideline that the president has put out...
NOVAK: Why not?
DAVIS: At least the American people...
NOVAK: Why not stop the earmarks?
PRESS: Well, I want to...
DAVIS: Because, well, one guy's earmark is another person's -- Bob, that's just the way it works. But as long as you hold the spending to 4 percent, you're going to have fewer earmarks, and I think that's what's important.
PRESS: Let me jump in here with another way. I just want to be helpful in a way that you might be able to save some money, which is to do away with this crazy idea of eliminating the estate tax. You know, we've heard about this, big part of the president's tax cut, and we've heard about it for a long time. And we've heard about you have to get rid of the estate tax to save these family farms.
I don't know whether you read yesterday's "New York Times." In that paper, front page, the American Farm Bureau, Federation -- if anybody knows small family farms, they do -- said they could not cite one single example of a family farm lost because of the estate tax in this country.
So from the president on down, congressman, this whole thing is one big lie, isn't it?
DAVIS: No, not really.
PRESS: Where is it?
DAVIS: I think, first of all -- well, small businesses, you have a number of small businesses that employ people that are in jeopardy over the estate tax because it can't be passed down without having to pay a heavy taxes. This is across-the-board. People are paying twice. They're paying income tax and then 55 percent. At least reduce it.
I mean, the House with 65 Democrats supporting it has voted to repeal that. It now goes to the Senate, where I'm sure it will get paired down.
PRESS: No, but you just said the key word. First of all, I'm asking -- talking about -- you shifted over to small businesses. No, I'm coming back to what the president says we need this for family farms. And again, nobody can find one family farm that's hurt by it. But you used the key word. Why not reduce it? Why not do what John McCain did, which is up the limit maybe to $4 million or whatever, but don't get rid of it because only 2 percent of the wealthiest, wealthiest people in this country would have to pay it any way?
DAVIS: Well, as I said, you had a very strong bipartisan majority, 65 Democrats joining virtually every Republican, in voting to repeal it, who think it's just wrong.
NOVAK: OK. Congressman Charles Rangel, I'm going to make one more bite at this apple, because I'm a stubborn guy. "The New York Times," which I'm sure you read, had the other day a story saying that this heartless, mean Bush administration had cut $16 million in child abuse money.
Now, I looked in the budget again for that, and it turns out that 16 million was an unrequested earmark. It was a pork barrel proposal by one congressman. Can't you see that they're trying to eliminate a system that Woodrow Wilson said over 100 years ago was the bane and the agony of the congressional system?
RANGEL: Let's stay with children, because there's the budget going again. A program has been cut by $200 million that's supposed to provide temporary assistance for needy family. These funds were supposed to be available for low-income child care in the year 2002.
Now, this is the program that Secretary Thompson fought so hard for to change welfare as we know it and bloc grants go directly to the state, and these grants are now being cut by $200 million.
And so, yes, (UNINTELLIGIBLE): You may increase for child abuse here and then cut back in food and shoulder someplace else.
NOVAK: That'll have to be -- sorry, that'll have to be the last word. Thank you very much, Charles Rangel in New York -- we appreciate it. Tom Davis, thank you. And Bill Press and I will be back with closing comments to chew over some pork.
NOVAK: Bill, when you were fawning over -- oh, I'm sorry. The CROSSFIRE doesn't end here tonight. Congressman Tom Davis will be in the chatroom right after the show at cnn.com/crossfire.
Thanks for reminding me, Bill.
PRESS: Who was I fawning over?
NOVAK: John McCain in New Hampshire last year, when he was saying we've got to do something about cutting out the pork barrel spending, the earmarks, the congressional earmarks.
Now, we have a president, the first one in my experience in 40 years, who is doing something about earmarking. Forget everything else. You've got to give him credit for doing that in his budget.
PRESS: I give him credit for getting rid of as much pork as he can, including Trent Lott's...
PRESS: ... big ship-building operation down there in Mississippi, because...
NOVAK: That wasn't pork. That wasn't pork.
PRESS: Oh, there you go, the Republicans don't have pork.
But I tell you what I don't give hi credit for. I don't give him credit for cutting children's health. I don't give him credit for cutting the environment or for energy or for public safety. No compassionate conservative, Bob.
NOVAK: Well, you know what I give? I give you credit for giving him credit for cutting pork, and I have written that down.
PRESS: We're for that. From the left, I'm Bill Press. Good night for CROSSFIRE.
NOVAK: From the right, I'm Robert Novak. Join us again next time for another edition of CROSSFIRE. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com