No one expects this to occur. Leaders of both parties have acknowledged that a number of appropriations bills cannot pass unless funding for these programs is restored. Moreover, the CBO and OMB projections assume that for years after 2002, total expenditures for discretionary programs will remain at the level of the severe cap for FY 2002, adjusted only for inflation in years after FY 2002. This means the surplus projections assume levels of discretionary program expenditures for fiscal years 2001 through 2009 that are lower, when inflation is taken into account, than the highly unrealistic FY 2000 cap that almost certainly will not be met. Moreover, both parties have proposed significant increases in defense spending in coming years.
Defense spending constitutes about half of overall discretionary expenditures.
In addition, legislation enacted last year requires increases in highway spending in coming years. CBO must issue budget projections based on current law. The discretionary spending caps are current law. CBO has acted appropriately developing its projections. Achieving cuts of this magnitude in domestic discretionary programs would be unprecedented and would dwarf the cuts Congress was able to pass in these programs when the nation was mired in large deficits.