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FYI Number 112: August 31, 2002

Worsening Budget Outlook Could Impact FY 2002 S&T Spending

A deteriorating budget outlook threatens science and technology funding for FY 2002, which starts in one month. Vigilance will be required to ensure that S&T budgets already considered by the House or Senate do not slip as Congress and the Administration struggle to make the books balance.

Policymakers are in a box. A weakening economy and tax reduction have diminished projected federal revenues. Yet increases are sought for selected programs, notably education, defense, and agriculture. The result is a greatly diminished projected federal budget surplus for FY 2002. The FY 2002 books may balance only if the Medicare surplus is included, an option that the Republican chairman of the House Budget Committee has already ruled out. Other choices are as unpalatable, including tax increases, deficit spending, or a reduction in defense spending.

With only eighteen working days until the start of FY 2002, Congress has not set almost two-thirds of all discretionary spending. A major uncertainty is the defense budget. Pentagon officials caution that the $18 billion in extra funding that President Bush requested is insufficient, and there will be pressure to appropriate additional money. Yet key Republican and Democratic senators are unwilling to release even the $18 billion. Suggestions have been made that offsetting cuts be made elsewhere within the Pentagon budget, such as by a reduction in force size, an unpopular strategy with many lawmakers.

Earlier this week President Bush offered his perspective on the budget. He stated:

"In the next few weeks, Congress will face some critical choices, and some old temptations. I'm asking them to let go of some of the old ways of doing business in Washington, D.C. Most of you have been around long enough to know how the process works. Often the important things are put off to last. And in the meantime, lots of new spending gets thrown in. Near the end of the process, suddenly we hear that Congress is about to go over the budget, so the items that have been saved for last are the ones most likely to get cut.

"And guess which -- guess what usually has been saved for the last? The defense bill, leaving our national security at the mercy of budget games and last-minute cuts. This year, we might even see our administration's two highest priorities, education and national defense being played off against each other. That's the old way of doing business, and it's time to stop it. We may have different agendas in Washington, but we all have the same basic obligations. We must start with the things that matter most to the future and security of our country. This time -- and from this time forward, let us put education and national defense at the first of the line, not at the last."

So what does all of this have to do with FY 2002 S&T budgets? Unless Congress and the Administration can agree to new budgetary ground rules, funding increases will have to be offset by selective or across-the-board reductions in other programs. Preventing such reductions, and building support for increases for S&T programs, will require active constituent involvement during the next few weeks. See the AIP Science Policy web site for information on the status of S&T budgets, guidance on constituent communication, and the names of key Members of Congress.

Richard M. Jones
Media and Government Relations Division
American Institute of Physics
(301) 209-3095

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