President Bush's final budget request arrived Feb. 4 on Capitol Hill to familiar protests from Democrats who have scoffed at his tax and spending recommendations for seven years, and have been able to do little beyond making minor changes around the edges.

In proposing to spend $3.1 trillion in fiscal 2009, which begins Oct. 1, Bush once again asked that domestic discretionary programs essentially be frozen at current year levels. At the same time, he proposed big increases for defense, other security programs and foreign assistance. He said he wants some reductions in the expected costs of Medicare, Medicaid and other entitlement programs. And he recommended that his signature tax cuts -- the centerpiece of his economic agenda from his first term -- be made permanent before they expire in 2010.

It will probably be easy for Democrats to reject Bush's calls to extend the 2001 and 2003 tax cuts and rein in entitlements in the way he proposes; they have done so before. The twist this year is that they may, if they choose, largely ignore the president's recommendations on discretionary spending, while waiting to see if one of their own is elected in November to take Bush's place.

A year ago, when Democrats took control of the legislative branch, they announced that they would put their own stamp on spending. Instead, reality set in later in the year as Congress tried to complete work on the annual appropriations bills. Armed with veto threats and the backing of enough congressional Republicans to give them weight, Bush was able to force Democrats to adhere closely to his requested ceiling on discretionary accounts, and lawmakers were constrained to shifting around a limited amount of money to meet their priorities.

Bush's insistence that Congress again keep a lid on the discretionary budget has an expiration date of Jan. 20, 2009, however, and that may give Democrats leverage in this year's budget battle.

"The president really had us over a barrel last year on the appropriations bills," said Senate Majority Leader Harry Reid of Nevada. "But he doesn't have us over a barrel this year, because either President Clinton or Obama will be the president in less than a year." And if Congress has to pass a short-term continuing resolution to keep the government open until Inauguration Day, Reid suggested, it will do so. "We are not going to be held hostage by the unreasonableness of the White House," he said.

It's far from certain that Democrats will postpone most spending decisions until after the election and gamble on who will win the White House. Still, the idea of delaying some or all of the annual appropriations bills is being considered by House Democratic leaders, according to aides, but discussions on whether or how this would be done have not progressed very far.

"It is definitely still a live option," said a House Democratic aide.

If Democrats do decide to wait out Bush this year, that decision probably won't come until after Congress has written some appropriations bills and the president has threatened vetoes -- something that would draw clear lines for voters over the parties' spending differences. Democrats may even decide that pushing Bush and congressional Republicans into a few veto fights will pay dividends in November.

Not completing work on appropriations on time would have drawbacks, however. That would opens Democrats to the same criticism they leveled at Republicans in 2006 for postponing the most basic assignment of Congress. Moreover, congressional Democrats might have to face Republican John McCain as the new occupant of the White House. And neither Hillary Rodham Clinton nor Barack Obama, should one of them win the presidential contest, would probably be eager to start off an administration handling last year's budget work.

The chairmen of the House and Senate Budget panels are planning to start soon on the annual budget resolution, a blueprint that directs the year's tax and spending decisions. They plan to mark up their resolutions in early March, and that will set the stage for whatever decisions on appropriations or tax policy decisions come later.

Regardless of the strategy pursued by the Democrats, the election has shortened this year's legislative calendar, and that will leave relatively little time for budget work.

"My gut tells me that for the average politician in this town, whether it's the president's budget or Congress' budget, it will be looked upon as a holding pattern and 'let's wait until next year,' " said G. William Hoagland, a longtime Republican budget aide who now works for Cigna as a vice president for public policy.

The potential conflict this year over spending comes down to whether defense should be the only part of the discretionary budget that is allowed to grow.

"Two key principles guided the development of my budget: keeping America safe and ensuring our continued prosperity," Bush said in his message accompanying the budget.

Democrats took a decidedly different view. "The American people expect our nation's budget to chart a course that reflects their values and aspirations, makes critical investments in our future and is fiscally responsible," said House Speaker Nancy Pelosi, D-Calif. "The president's budget fails to meet those standards."

Before taking into account emergency money that isn't subject to either congressional budget rules or Bush's spending ceiling, the president requested $987.6 billion in discretionary budget authority for fiscal 2009. This represents a 4.9 percent increase from fiscal 2008, and almost all of it would go to what the White House refers to as "security" programs -- chiefly defense, homeland security and international aid.

Security funding makes up $594.5 billion of the president's request. That leaves room for $393 billion for domestic programs, an increase of less than 1 percent. The president also assumes in his budget request that domestic funding will not change over the next five years.

"The Bush budget for America is worse than a freeze -- it is an Arctic freeze -- slashing programs which benefit the education, health and safety of American citizens," said Senate Appropriations Chairman Robert C. Byrd, D-W.Va.

The budget also requests $75.8 billion in emergency funding for fiscal 2009, which is supposed to be for one-time events. Of that amount, $70 billion is designated for military operations in Iraq and Afghanistan -- although it is all but certain that he will ask for additional war funding later -- and $5.8 billion would go to help the Gulf Coast continue to recover from the 2005 hurricanes.

The president is again proposing cuts in programs that are popular with Democrats, such as sewage treatment and transportation projects and local law enforcement grants. Throughout the budget, Bush proposes eliminating or reducing spending on 151 programs that would amount to a savings of $18.2 billion in fiscal 2009. But many of those ideas have been tried in the past and rejected.

For instance, as he did last year, the president is calling on Congress to terminate the Agriculture Department's Commodity Supplemental Food Program, which provides nutrition assistance for pregnant women, children and the elderly, arguing that needed aid is already provided through food stamps and other programs. Congress rejected the request last year and instead boosted funding by almost $33 million.

Bush does request some increases in domestic spending for administration priorities. For instance, the president asked Congress to renew the 2002 education law known as the No Child Left Behind Act and requested $14.3 billion for Title I spending, which funds most of the initiative's efforts, a 3 percent increase. But Democrats are likely to argue that his request is actually too small for a law that some of them supported and most say has been underfunded from the start.

In fact, Democrats wasted little time in dismissing most of the domestic spending proposals. "We're not going to follow his budget," said Iowa Democrat Tom Harkin, chairman of the Senate Appropriations Labor-HHS-Education Subcommittee. "I mean, his budget is all screwed up."

The effects of weak economic growth are evident in the president's requests, and the economy will certainly be an issue Democrats will face when writing their own budget resolution.

The most obvious economic effect is that the White House is estimating a deficit of $410 billion for the current fiscal year and almost as much -- $407 billion -- in fiscal 2009. This surge in needed borrowing follows three straight years of shrinking deficits. In part, the improved budget picture of the recent past stemmed from rising corporate tax revenue, but that pattern is expected to reverse as the economy cools and corporate profits fall off.

The expected deficit this year will come close to the record $413 billion shortfall recorded in fiscal 2004, but it will be smaller as a share of the overall economy. The 2004 deficit amounted to 3.6 percent of gross domestic product, while the current-year projection is 2.9 percent of GDP. Neither, however, is close to the fiscal 1983 deficit that was calculated as 6 percent of GDP and followed a deep recession in 1981-82 and President Ronald Reagan's 1981 tax cut. By contrast, the fiscal 2007 shortfall was $162 billion, or just 1.2 percent of GDP.

One reason the projected fiscal 2008 deficit is so large is that the administration assumed that Congress would complete an economic stimulus package, as it did on Feb. 7 (HR 5140). The measure, as cleared, was expected to cost $151.7 billion this year, more than the estimated $125 billion in the budget.

Yet, while congressional Democrats and Republicans alike supported the stimulus bill -- and the additional borrowing it will require -- there is little agreement on the administration's plan for returning the budget to surplus by fiscal 2012. That projection drew criticism from Democrats, budget watchdogs and even some Republicans who argued that it is based on dubious assumptions.

"The president's budget does not provide a realistic path to fiscal balance, in either the short term or the long term, but it does demonstrate how difficult the choices are becoming," said Robert L. Bixby, executive director of the Concord Coalition, which supports budget-balancing policies.

For instance, the administration assumes that a change in tax law will be enacted in 2008 that will restrict the reach of the alternative minimum tax (AMT), at a cost of more than $60 billion in fiscal 2009. But it also assumes no further limitation on the AMT in later years, which would allow this tax to affect millions of taxpayers and generate billions of dollars in revenue. Realistically, neither the administration nor most lawmakers of either party have any desire to see the reach of the AMT broadened into the middle class, and House Democrats have proposed repealing this alternative tax structure, although they would couple that change with new taxes to prevent a revenue loss.

And the inclusion of only $70 billion for war operations in Iraq and Afghanistan for fiscal 2009 and nothing for later years led Democrats to charge that Bush was intentionally lowballing the costs. For the current year, the president has sought $196.4 billion for the wars.

"This administration's last budget ends with the same lack of candor that characterized those that preceded it," said Senate Finance Chairman Max Baucus, D-Mont.

The criticism from Baucus and others extended beyond the AMT and war funding estimates to the broad economic assumptions underlying the budget. In particular, the White House forecasts that the economy will grow by 2.7 percent this year, considerably faster than almost all other estimates, and another reason revenue may be overstated.

Administration officials made numerous appearances on Capitol Hill following release of the budget. But while there were some tense exchanges between congressional Democrats and the White House, the debate had the feel of two teams playing out the clock in a game they knew would soon end.

"Budgets are, frankly, one-year documents," said White House Budget Director Jim Nussle, a former House Budget Committee chairman who isn't afraid of rhetorical dust-ups, at a news conference Feb. 4. "We project out five years, but they're one-year documents, and they project what we believe is the path in order to get back to balance -- a credible path."

Even the debate over war funding, which provided for some theatrics at the hearings, eventually had both sides acknowledging that regardless of what is in the budget, the next president will determine what will be spent in future years.

"Rather than tying the hands of our next commander in chief, who can make the decision about what that strategy ought to be, we decided to fund it to a reasonable time after this president has left office to give that flexibility to the next commander in chief to make the decision about not only what the strategy should be, but also what the funding level should be," Nussle told the Senate Budget Committee.

"Obviously, our policy is different than the president's policy," said Senate Budget Chairman Kent Conrad, D-N.D. Because Democrats want to leave Iraq, the numbers in the president's budget "would be far more realistic given a Democratic policy on Iraq, totally unrealistic with respect to the president's policy."

Democrats will have some tough decisions and may face their own candor test in early March, when both chambers begin drafting their annual fiscal blueprints for fiscal 2009 and the following four years.

House Budget Chairman John M. Spratt Jr., D-S.C., has said he would like to produce a balanced budget by 2012. And while Conrad hasn't specifically said he has the same goal, he has made reducing the deficit central to his budget policies.

Whatever they try to do, they will need to address several long-term tax and entitlement issues, and that means accepting, rejecting or changing some of the administration's most visible recommendations.

Foremost among those issues, perhaps, is the expiration of the 2001 and 2003 tax cuts. Bush wants them permanently extended, at a cost of $635.1 billion over five years and $2.1 trillion over 10 years. And while there is no chance that the issue will be addressed legislatively this year, the Democrats will have to make some assumptions in their budgets about tax receipts.

In their budget resolution last year, Democrats assumed that most of the tax cuts, except for some that benefit the middle class, would expire, or would be extended and offset by other revenue increases elsewhere. Republicans called such offsetting tax increases unrealistic and dangerous. With the economy in worse shape today, the debate is likely to grow louder, and GOP lawmakers are expected to argue that extending the tax cuts now would add certainty to the economy and spur job-creating business investment.

"Republicans understand that Americans are dealing with higher costs at home and in their small businesses, and that's why the time for Congress to act on these critical issues is now, not in 2009," said House Minority Leader John A. Boehner, R-Ohio.

But Democrats dismiss most of the 2001 and 2003 tax cuts as a boon to the rich. They point to them as evidence that Bush and the Republicans have been poor stewards of the government's finances, and charge that the cuts led directly to almost a doubling of the federal debt.

When Bush took office, the total amount of debt owed by the government stood at $5.7 trillion. Today it totals more than $9.2 trillion.

Regardless, Democrats have their own tax ideas, some of which coincide with the president's. Those include continuing to prevent a broader reach of the AMT and extension of some targeted tax benefits that are expiring. Chief among the latter is a tax credit for companies that increase their research and development spending. Both will cost billions of dollars, and Democrats will have to decide whether to allow those changes to swell the deficit -- and ignore pay-as-you-go budget rules -- or to do battle with the White House and GOP lawmakers over offsets.

For the most part, congressional Republicans and Bush have rejected offsets, although the budget does contain a few revenue-raising proposals. Bush called again for reducing the estimated $290 billion in taxes owed that go uncollected each year. He suggested allowing federal agencies to disclose more information about taxpayers and investigations to American Indian tribes and other third parties, extending the three-year statute of limitations on some tax liabilities and making repeated willful failure to file tax returns a felony.

But in the face of opposition last year, the Democratic Congress wound up enacting an AMT patch that was not offset.

Republicans, meanwhile, blame the growing debt at least in part on the residual effects of the 2001 recession, the costs of responding to the Sept. 11 terrorist attacks, and the subsequent wars in Iraq and Afghanistan. For whatever reason, the red ink has swelled on Bush's watch, and he was working with a Republican Congress for the first six years of his presidency. And that has given Democrats both ammunition and an obligation to make their own choices.

Conrad estimates that Bush's budget would raise the debt to $13.3 trillion by fiscal 2013, about a trillion dollars more than the administration's forecast. "The result of all this is the gross debt of the United States is going up like a scalded cat," he said.

But Nussle threw the argument back at the Democrats, noting that they have been quick to dismiss the president's proposal to cut the growth of Medicare and Medicaid by $195.7 billion over five years and by more than $600 billion over 10 years.

For Medicare alone, the administration wants to shrink the program's growth rate to 5 percent annually, from 7.2 percent. The largest Medicare reduction would come from slowing the growth of hospital spending by freezing payment rate increases for three years. That would eliminate $4 billion in Medicare growth in fiscal 2009, and $64.2 billion over five years. Other payment rate freezes -- for rehabilitation facilities, nursing homes and outpatient care, for example -- would save an additional $3.3 billion in 2009.

"Let's open up mandatory spending," Nussle shot back as Conrad scolded the budget director over the debt increase.

Conrad and Sen. Judd Gregg of New Hampshire, the ranking Republican on the Budget panel, have introduced legislation to create a task force that would produce proposals for dealing with the government's long-term fiscal problems. Conrad said he will have the committee vote on the bill this year, but Democratic leaders appear cool to advancing the legislation much further.

Alan K. Ota and Liriel Higa contributed to this story.