Money Talks

It is that time of the year when the politicians in the high seat of power, with money in their briefcases, decide where to spend the tax payer’s moolah for the welfare of the country. Calls have already been made, loudly and vociferously, for a populist budget with the further development of rural India as the focal point of the session. The leaders of the UPA have, for once, rallied together, and asked Finance Minister P Chidambaram for the move, and it is likely, considering the fact that the markets are remaining bullish even after the short recession, that their wish will be granted.

Apart from the obvious, though, a populist budget built around the rural agro based industry might be a shift from the progress graph of the UPA government. Also, with a greater standing in the world at stake, the Indian finance ministry cannot risk further recession of the market, by not supporting the power that is driving the economy.

Let us take a peek at what our folks up in Washington D.C. are doing about their budget plans. The President of the United States, George W. Bush has presented his request for the budget plans of 2009 and it revolves largely around social welfare. Obviously, being a market-driven economy, the constant warring that the government undertakes, the focus of the government is to increase the piece of the budget pie for defence operations. This is Bush’s last budget before leaving the office, and it is one that undercuts the social privileges of the people in a big way.

The emphasis on the housing and safety of the homeless and the protection of women from violence, both basic, yet important factors in the country’s standard of living, have been undermined in the President’s request, and his suggestions are likely to be inculcated in the budget for the fiscal year 2009, although the Republicans will be given hell, by their Democratic opponents. There has been a request, though, to oppose the cuts given to some of the housing and safety net programmes, but an alternative has been provided, where the people have been requested to report to their local representatives for welfare.

Congress likely will add to the president’s military construction budget, which included $6.9 million for new construction at the Naval Construction Battalion Center in Gulfport and $8.1 million for a child development center at Columbus Air Force Base.

Bush, however, would freeze spending on many social programs, despite inflation and greater demand spurred by a growth in population and a faltering economy.

To pay for his priorities, Bush proposed trimming $196 billion from Medicare and Medicaid programs over the next five years.

“We are having a hard time making ends meet as it is,” said Francis Rullan, spokesman for the Mississippi Division of Medicaid. “Any cut in Medicaid would not be good for Mississippi.”

The state has a projected deficit of $91 million for Medicaid – the state and federal health care program for the poor and elderly – in its 2008 budget. There are a few more problems with the budget request, and the Homeland Security Budget is also under the scanner for the same.

The expected fights over the budget and Bush’s lame-duck status nearly guarantee that most of the work on the 2009 federal budget won’t be completed until a new president is in the White House.

Vineet Kanabar