THE BUDGET illusionists are still busily employed, but last year's budget agreement changed the nature of the job. The old task was to paint large programs as manageable or small. Yes, this or that would cost a lot, but not to worry; never would it enlarge the deficit.
The new task is the opposite one: making programs of small or average size seem large. Of course, they will fit within the budget agreement -- who could think of violating that? -- but they are mighty engines nonetheless. At least this kind of puffery does not endanger the economy; that is the progress that has been made.
The president's budget is full of such exaggerations, "major," initiatives involving evanescent shifts or increases in funds. A particular example is the $87 billion, five-year highway construction program on which it proposes to embark. In proudly presenting the program in the budget and again the other day, the administration failed to mention a most important fact. By the normal method of reckoning, the government already has about an $87 billion, five-year highway construction program.
The budget process every year begins with construction of a baseline, the official definition of a standstill budget. This is the cost of doing no more (or less) than extending the last year's level of activity into the future, assuming no change in law and allowing only for inflation. The administration and the standstill spending totals for the next five years are essentially the same. The main increase the administration would provide is in the form of a promissory note; its program is backloaded so that permission to spend (though still not actual spending) would rise sharply at the end, which will coincide with the end of the next presidential term.
That is not to disparage the program, which is a serious effort to redefine a federal role in highway construction after completion of the Interstate system. The administration had an obvious problem of staying within the budget agreement yet keeping abreast of the Democrats on the infrastructure issue in a recession year and demonstrating its commitment to both sound transportation and jobs. And now, of course, the Democrats will have the same problem, and not only in the highway bill. They have to produce a program that sounds expansive but doesn't expand; that's this year's trick. But never fear; the Democrats have their illusionists, too.