President Bush is counting on an enormous amount of good luck in the budget he put before Congress yesterday. To put it another way: only on extraordinary assumptions do his figures add up.

He wants to spend more than $300 billion (£150 billion) on the conflicts in Iraq and Afghanistan in the next two years — but then expects war spending to plummet by two thirds. He also wants to repeal none of the tax cuts he made in his first term. Yet he says he can balance the budget by 2012.

Part of the secret is his optimism about economic growth. The White House predicts much faster growth than the independent Congressional Budget Office (CBO) — although growth, and tax revenues, have indeed been much better in the past two years than many predicted.

But the challenge that Bush has thrown down to the new Democrat-controlled Congress is whether it will back the huge cuts he proposes in health and education to make the budget balance. On the face of it, that looks ridiculous; even the previous Republican-controlled Congress turned down some of the proposals Bush has presented again. Democrats, riding high on their victory in the November elections, are unlikely to do him the favour of cutting into their favourite programmes to pay for his wars.

Yet he may be astute in reckoning that he has nothing to lose in this affrontery: trying to make the Democrats look more profligate on social spending — and so more irresponsible — than he does in spending on defence and security.

We can regard it as a small concession to the Democrats’ new position of strength that Bush has spelt out the estimates for spending on Iraq. In previous budgets, he has lumped that into “supplemental” requests, with far less detail.

About $380 billion has been spent on Iraq, and Congress has already approved $70 billion for Iraq and Afghanistan in the 2007 financial year (which ends in September). Bush is asking for a further $93.4 billion for this year, and $141.7 billion for 2008 (more than $300 billion on war for the two years). But in 2009 war costs are projected to drop to $50 billion and to zero after that.

Critics say that the $5.6 billion that the Administration has given as the cost of the “surge” of extra troops is too low. They point out, too, that if the conflict is prolonged, then these estimates are too low.

The White House is flatly at odds with the CBO over the effect of keeping Bush’s much-cherished tax cuts. It says they will boost growth by enough to balance the budget in five years; the CBO, in projections just two weeks ago, says they won’t.

But Bush’s biggest gambles are political. Democrats point out that the Republican-controlled Congress rejected much smaller cuts in federal healthcare spending than Bush has now proposed. They also point out that Bush — and the CBO — assume a big extension of the “Alternative Minimum Tax” to middle-income households. This tax, designed to ensure that high-income taxpayers who were adept at tax avoidance still paid some tax, is now about to catch many of the middle class.

Bush’s decision to ask again for oil drilling in protected parts of Alaska — rejected by the Republican majority — also counts as picking an unpromising fight. It seems likely that Democrats will turn down many of his cuts, and hope they can blame him for economic mismanagement as well as for Iraq.

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