Bush budget gets mixed reaction from delegation Baldacci foresees loss of funding

AUGUSTA – President Bush’s proposed $2.77 trillion budget is getting mixed comments from the state’s congressional delegation and from Gov. John Baldacci, who says if it is approved, Maine and other states will see continued loss of federal funds.

Still, Baldacci cautioned Tuesday against overreacting and stressed that it’s “just a proposal and we will have to see what it is when Congress is done with it in the fall.”

Baldacci, who served eight years in Congress, said he is more concerned about the immediate cuts in federal funds to the states that were approved last week as part of the Deficit Reduction Act. That measure cuts $39.7 billion over five years.

While state officials are still assessing the impact of those cuts on Maine, the governor said, “It’s going to be difficult.”

Referring to Bush’s latest budget proposal, U.S. Sen. Susan Collins agreed with Baldacci that the finished product that comes out in the fall will contain substantial differences from the present document.

“Some of these cuts are clearly dead on arrival,” the Republican senator said. “Some of them are nonstarters that have been rejected by overwhelming, bipartisan majorities in the past, and I expect they will be this year.”

For example, Collins said, proposals to cut funding for local law enforcement and emergency first responders have been proposed in the past by the president and have been rejected by both branches of Congress.

But Collins also praised some of the budget initiatives.

“There is a 27 percent increase in LIHEAP funds,” she said. “While that is not enough, it is a positive sign.”

Collins, a member of the Senate Armed Services committee, also praised the additional funds proposed for Navy shipbuilding that she said will help Bath Iron Works, the state’s largest employer.

U.S. Rep. Tom Allen, a Democrat, said he could find little to like in Bush’s budget proposal. He finds particularly troubling the proposed cuts in health care programs.

“The president’s request to make his tax cuts for the wealthy permanent will create permanent, destructive deficits, mortgage our children’s future and undermine American competitiveness in the global economy,” he said. “His proposals to cut $36 billion in Medicare spending over the next five years, reduce reimbursements to health care providers and increase premiums for some Medicare beneficiaries will seriously weaken the program.”

Allen said he is very upset at the proposed cuts in children’s health care, student loans, business startup grants as well as proposed reductions in funding for special education, homeland security and No Child Left Behind programs. He said many would result in a cost shift to state and local taxpayers.

Republican Sen. Olympia Snow, who has seen more proposed federal budgets than the rest of the state delegation combined, is concerned about the increase in the federal budget deficit that is part of the budget proposal. She told Treasury Secretary John Snow of her worries at a hearing Tuesday.

“If we renew all of these expiring tax cuts and other popular tax breaks, such as the research and experimentation tax credit, as well as mitigate the impact of the increasingly onerous alternative minimum tax, our nation could face $4.2 trillion in red ink over the next 10 years,” she said.

Rep. Michael Michaud, a Democrat, also was concerned with the continued deficit spending.

“The bottom line on this budget is it borrows from Social Security and our children’s future to help pay for today’s costs with record deficits,” he said.

Michaud said several lawmakers from both parties were considering ways to reduce the deficit by requiring a pay-as-you-go approach for new spending.

“We have to restore fiscal responsibility to the federal budget,” he said.

Michaud said he also has concerns about some of the proposals in the Veterans Affairs budget. He said the funding would fall short of what is needed as more and more veterans sought services.

“Sixteen percent of our population are veterans,” he said, referring to Maine. “Percentagewise we are the highest in the country.”

All four members of the delegation stressed that the budget proposal was just a blueprint, and that it will be changed substantially by the end of the budget process in the fall.