No End to Superspending?

May 18, 1953

The announcement of President Eisenhower on April 30 that he would ask Congress “to appropriate $8,500,000,000 less new money for fiscal year 1954 than had been asked for by the previous Administration” made a good one-day headline. But it will not bring much comfort to taxpayers who examine the situation closely. This $8,500,000,000 is not a proposed cut compared with the previous rate of Truman spending. It is merely a cut from President Truman’s estimate for a fiscal year when he would not be in office and for which he knew he could not be held responsible. And it is a cut only in requested new appropriations, not necessarily a cut in actual rate of spending. In last week’s issue, Newsweek estimated that the Eisenhower spending budget for the fiscal year 1954 would approximate $74,200,000,000. This would be about the same as is being spent in the present Truman-Eisenhower fiscal year which ends on June 30. But it would be $8,000,000,000 more than was actually spent in the last full Truman fiscal year of 1952 and almost $30,000,000,000 more than was spent in the Truman fiscal year 1951. The Korean war was being fought during the whole of both these years.

Mr. Eisenhower complains that when he took office he found “a total carry-over of $81,000,000,000 in appropriated funds, largely committed. . . . It’s just as if the late Administration had gone to the store and ordered $81,000,000,000 of goods, which we’ve got to pay for as they’re delivered, in addition to paying the regular household running expenses.”

But two questions must be raised about this: (1) Is the whole of this $81,000,000,000 in fact so irrevocably committed (in the form of noncancelable contracts, for instance) that no appreciable part of it can either be rescinded or used for new purposes? (2) Isn’t Mr. Eisenhower planning to continue the same sort of carryover to make it just as difficult to balance the budget in future years? A simple calculation leads, in fact, to the conclusion that on his present proposed spending and appropriation program he will end even the fiscal year 1954 with a carry-over of more than $70,000,000,000 unspent appropriations into 1955.

“I have always firmly believed,” said Mr. Eisenhower in his statement of April 30, “that there is a great logic in the conduct of military affairs. There is an equally great logic in economic affairs. . . . If . . . these two are allowed to proceed in disregard one for the other, you then create a situation either of doubtful military strength or of such precarious economic strength that your military position is in constant jeopardy.”

This is admirably said. But the specific budget decisions Mr. Eisenhower has so far announced seem in fact to disregard economic logic. His message of May 5, urging Congress to authorize $5,800,000,000 for the foreign-aid program in the fiscal year 1954, is an outstanding case in point. True, this was a reduction of about $1,800,000,000 from the previous Administration’s 1954 budget. But Mr. Eisenhower is asking for it on top of some $9,000,000,000 of prior appropriations for foreign aid that still remain unspent at this time.

Nor did the statements either of Mr. Eisenhower or Mr. Dulles really explain why this additional $5,800,000,000 is needed. It is not enough merely to contend that the United States must “carry out its responsibilities of leadership in building up the security of the free world.” It must be shown that this particular method is the way to do this, and that no less than this amount is necessary. The answers to these questions so far have been little better than rhetorical. Our whole foreign-military-aid program, in fact, rests on the constantly reiterated but still unproved contention that Europe cannot afford to pay for its own defense.

Our own economy is in real danger from the present appalling rate of spending and intolerable load of taxes. If it is undermined by these the defense of the whole free world will really be imperiled.