THE 2004 BUDGET President Bush submitted this week suffers from multiple personality disorder. In part, it is the budget of a cautious, sober-minded administration shepherding the country through a time of reduced revenue and increased demands. In part, it is the work of a throw-caution-to-the-wind administration willing to gamble the nation's fiscal health.

First, meet the prudent Mr. Bush. He gravely insists on hard choices in hard times. Tax revenue has fallen two years in a row, the first such drop in 40 years. The deficit is at a record high and is expected to add up to $1.1 trillion over the next five years. In response, this Mr. Bush would restrain growth in discretionary spending to 4 percent, higher than inflation but about half the recent growth rate. Discretionary spending is the one-third of the budget not taken up by entitlement programs, interest on the debt and other no-choice accounts. The administration would increase spending on defense (4.2 percent) and homeland security (5.5 percent) while expanding other programs by less (3.8 percent). Poor people in particular may feel the pinch. The liberal Center on Budget and Policy Priorities calculates that domestic discretionary spending other than for homeland security would be one-half of 1 percent above 2002 levels -- and, adjusting for inflation, down 4.8 percent.

That might seem a reasonable sacrifice given the urgent need to defend against terrorism -- until the profligate Mr. Bush comes riding into the picture. Having sought and won a tax cut that will cost $1.35 trillion over 10 years, this Mr. Bush wants to accelerate those cuts and make them permanent. He wants to exclude most dividend income from taxation. Altogether he is proposing tax changes that would cost an additional $1.5 trillion. And that's not all. Layered on top is a new savings plan that would allow taxpayers to shield huge amounts of investment income, a proposal whose price tag down the road is likely to be significantly higher than that of cutting taxes on dividends alone (since dividends account for only about one-fourth of investment income).

All this happens as major bills come due. The cost of a war with Iraq is not included in this budget. The costs of Medicare and Social Security will outstrip their revenue by $18 trillion over the next 75 years, according to administration estimates. And, with a return to deficits, the government will be paying more and more interest on the national debt -- more than $1 trillion over the next five years. Pressed about this, the administration breezily asserts that tax cuts will spur economic growth that will take care of all these worries. President Reagan's tax cut was sold with the same logic -- and the nation spent the better part of two decades digging out. At least Mr. Reagan had the sense, when deficits started to pile up, to undo some of his tax cuts. Mr. Bush just wants to just plow in deeper.