The Bush administration has consistently tried to make the war in Iraq seem like a costless effort. But we pay for every dollar spent in Iraq, particularly in terms of opportunity costs. Every dollar spent in Iraq is lost potential spending in domestic programs.

OMB Watch released a statement yesterday afternoon harshly criticizing the Democratically control Congress and the president for abandoning fiscal responsibility in the final hours of 2007 after they entire year was spent adhering to or attempting to adhere to righting our nation's fiscal course. From the statement: Adding insult to a year of fiscal policy injuries, Congress has abandoned fiscal responsibility by waiving pay-as-you-go (PAYGO) rules in order to pass a one-year patch to the alternative minimum tax (AMT) without offsets. This tax cut adds another $50 billion to an already expanding deficit next year, and will give fewer options for our children and grandchildren to seek solutions to the problems of tomorrow. While I expect as much from President Bush, this is a huge disappointment from the new Democratic majority in Congress whose number one promise was to uphold pay-as-you-go (PAYGO) rules. So much for promises: This vote is particularly disappointing as Democrats have gone to great lengths this year to comply with PAYGO rules, particularly on spending. From student loan reforms to expansions of the State Children's Health Insurance Program and Food Stamps, Democrats have negotiated the turbulent fiscal waters of the federal budget responsibly, diligently, even courageously. That is why at this point, after all that work and sacrifice, the compromises and the concessions needed to construct balanced solutions to the AMT problem, it is unacceptable for them to abandon their stated principles of fiscal responsibility because they fear Americans will not accept paying up front for the services and benefits the country demands. As the statement makes clear, there is plenty of blame to go around in Washington for this policy failure. What an awful way to end 2007.

CQ Today reported ($) this afternoon the Senate is close to a deal on extending SCHIP into 2008. According to the article, a bill is being written to delay cuts taking effect Jan. 1 to Medicare physician pay rates that would include an extension of the SCHIP program. From CQ: The package also is expected to include a funding extension of the State Children's Health Insurance Program, or SCHIP, but it's uncertain for how long. There appeared to be agreement earlier on an extension until 2009, but the Republican aide cautioned that the situation was "fluid." House Democrats have been pushing to extend SCHIP funding until September 2008, in order to force another debate on what they see as a winning political issue. A extension until 2009 would certainly make the legislation more palatable to Republicans, however. SCHIP is set to expire this Friday if Congress does not act to extend it further.