2/4 Editorial

President Bush played Jekyll and Hyde in his State of the Union speech Tuesday. For each small-government conservative idea — making tax cuts permanent, for example — he offered at least one awful statist proposal — new subsidies for alternative-energy research.

The pattern was no more apparent than in what he called his American Competitive Initiative, which proposes worthy tax credits along with large increases in spending for research.

White House science adviser Jack Marburger filled in some details of the initiative in a conference call with editorial writers Wednesday. More details and more solid numbers will come out Monday with the Bush budget proposal for fiscal year 2007, which begins Oct. 1.

Marburger said the president wants a permanent extension of the investment tax credit, which would “cost” $4.6 billion for fiscal 2007. That’s the lion’s share of the $5.9 billion “cost” of the whole initiative. A permanent investment tax credit is an excellent idea. Marburger said the “cost” of the initiative would be $5.9 billion in fiscal year 2007, with the total being $136 billion over 10 years.

(Unfortunately, he followed the recent Democratic rhetorical practice of calling tax cuts and credits a “cost.” When businesses or citizens are given back their own money, it’s not a “cost,” but a benefit. It means more money will be spent in the productive private sector and less in the unproductive government sector.)

Aside from the terminology, we’d have been pleased if the initiative had stopped with the tax credit plan.

Unfortunately, there are two more components to the president’s proposal.

The first, Marburger explained, would double federal spending on basic federal research over the next 10 years, which would cost $910 million in 2007. This is a lot like the kind of “industrial policy,” earmarking tax money to promote certain areas of anticipated future economic expansion, that has gotten in trouble the economies of Japan and Europe; that free markets are a better way to fund research and future industries.

Marburger said “there is a role for market-driven” initiatives and that two-thirds of research and development in America is done with private funds. But he said federal funding of basic research has bipartisan support and leads to some discoveries that would not be discovered by the private sector.

The third proposal was for more funding to advance math and science education in the nation’s public schools, costing $380 million in 2007. We object that this is yet more federal meddling in the operation of local schools, something that interferes with the involvement of parents and local citizens.

“We’ve got to have national standards to compete internationally,” Marburger said. He pointed to the president’s commitment to increasing the quality of education through the No Child Left Behind Act.

This is rather patronizing. And, as we have pointed out before, school achievement began declining when the federal government got deeply involved in local schools after the Sputnik scare in the late 1950s. And somehow, America led the world in science decades before the federal involvement began.

We urge members of Congress to back the investment tax-credit extension but oppose the extra spending, especially in a time of nearly $500 billion federal budget deficits. The private sector doesn’t need that kind of government help to lead the world in producing the industries of the future. It just needs to be freed to do the job.

And that means tax cuts, free trade, sound money, fewer regulations and no budget deficits.