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Declan McCullagh

Staff Writer, CNET

President Bush on Monday presented Congress with a $2.6 trillion budget for the federal government that would modestly reduce some social programs while boosting overall spending on information and surveillance technology.

The White House has proposed spending hundreds of millions of dollars on computer security, technology upgrades and aerial surveillance devices as part of a 7 percent increase in information technology spending by federal agencies. Last year, Bush proposed $2.4 trillion in government spending.

Also included in Bush’s 2006 budget is a proposal to make the research and development tax credit permanent, an idea that enjoys the strong support of U.S. technology companies. It provides a tax credit for a portion of certain research expenses and is scheduled to expire at the end of 2005.

“The 2006 budget supports the development of technology and innovation throughout our economy,” Bush said in a statement accompanying the stack of documents.

Among the highlights:

• The Department of Homeland Security would receive $174.8 million so border police could buy “inspection and surveillance technology, unmanned aerial vehicles and replacement aircraft.”

• DHS’ Information Analysis and Infrastructure Protection unit, which counts “cybersecurity” as part of its mission, would see its funding jump from $132 million to $204 million. That covers a Homeland Security Operations Center for “domestic incident management” and a program to gather “available cybersecurity information for dissemination in a timely, understandable and responsible manner.”

• The FBI cashes in with an 11 percent proposed increase that translates into about $555 million in more spending.

• Other portions of the Justice Department benefit, with $181.5 million earmarked for “information-sharing technology, $20.1 million for deploying an improved fingerprint database, and about $3 million for “cyberfraud and computer forensic assistance.”

• Grants handed out by the National Science Foundation will jump to around $5.6 billion, an increase of $132 million. The National Institute of Standards and Technology gets a 7.5 percent increase to $485 million.

• The National Aeronautics and Space Administration would receive a budget increase, but not enough to save the Hubble Space Telescope. Bush has cited manned missions as a priority instead.

Bush’s emphasis on security and defense comes at the expense of domestic social spending, including some programs at the Department of Education and the Department of Agriculture that would suffer modest reductions in discretionary spending.

That likely means tussles in Congress between now and the start of the government’s next fiscal year on Oct. 1, 2005. “The president’s budget is fiscally irresponsible, morally irresponsible, and a failure of leadership,” House Democratic Leader Nancy Pelosi of California said Monday. “Democrats insist upon fiscal discipline with budgets that pay as you go, and over the coming months, we will fight for a budget that reflects the values of America’s middle class.”

Even with its suggested reductions, the White House found millions of dollars in handouts to politically favored recipients. Among them: $900,000 to Western Carolina University for a “computer engineering program”; $250,000 to Pro Co Technology of New York City for a “computer training center”; $75,000 so Lewis-Clark State College can create an “e-commerce certification program”; and $600,000 to the Mississippi Technology Alliance, which is charged with strengthening the state’s “technology culture.”