Even though hundreds of other government programs would be squeezed, the president projects the deficit will still hit record highs of $304 billion this year and $307 billion in 2004. Over the next five years, deficits would total $1.08 trillion.
CBS News White House Correspondent Mark Knoller reports that Mr. Bush blames the recession and the Sept. 11 terror attacks for the red ink.
White House Spokesman Ari Fleischer said the president is determined to lead the nation into economic growth and a reduction of the deficits.
Mr. Bush's budget plan for fiscal 2004 that begins Oct. 1 will set off months of heated debate in Congress. Democrats attacked the tax cuts as a boon for the wealthy that will do little to help the economy but will rob Social Security of the money needed for baby boomers' retirements.
"Instead of offering the nation a plan for long-term economic prosperity, the Mr. Bush budget burdens us, and our children, with trillions of dollars of new debt," said Sen. Kent Conrad D-N.D.
"His plan will push up interest rates, retard economic growth and create massive problems for the soon-to-be retiring baby boom generation," said Conrad, the Senate Budget Committee's top Democrat.
The president blamed the deficits "on a recession and a war we did not choose." He said his budget would impose "spending discipline" through such efforts as reshaping the government's big health care programs, Medicare and Medicaid, along more conservative lines.
"The budget for 2004 meets the challenges posed by three national priorities — winning the war against terrorism, securing the homeland and generating long-term economic growth," Mr. Bush said in his budget message to Congress.
Mr. Bush sent Congress a 5-inch stack of books, weighing 13 1/2 pounds, spelling out his proposal. The five separate documents, featuring a bright blue line drawing of the White House, included one extra book this year analyzing the efficiency of hundreds of federal programs, part of a Mr. Bush management initiative.
The budget was released two days after the Columbia space shuttle disaster. In the NASA section, prepared before the accident, the administration proposed a 23.9 percent increase in spending on the shuttle next year, to $3.97 billion. That would follow a 1.9 percent cut in the shuttle program for this year, when the administration anticipated spending $3.21 billion.
In its management assessment of NASA, the administration said of the shuttle program: "Shuttle operations are well managed but investments to improve the shuttle suffer from inadequate planning and poor cost management."
Mr. Bush's $670 billion economic stimulus tax cuts include eliminating the double taxation of stock dividends, plus making permanent his 2001 tax cuts that are now set to expire after 2010. Taken together, all the new tax cuts Mr. Bush is proposing would add up to $1.3 trillion over the next decade, on top of the $1.35 trillion tax reduction passed in 2001.
Democrats have vowed to fight the new tax reductions, saying the country can't afford them when the nation is preparing for possible war with Iraq.
The defense budget would increase by a sizable 4.2 percent. However, that does not include money for a war with Iraq. The proposed increase, combined with an even bigger 11 percent boost in the current year, is the biggest defense buildup since President Reagan's in the 1980s.
The $15.3 billion boost in defense spending represents half of the $30 billion the president's budget is seeking in new money for the operation of all federal agencies. These increases do not include automatic spending for the government's huge benefit programs such as Social Security and Medicare, which account for two-thirds of the entire federal budget.
The $2.23 trillion total spending for next year reflects a 4.2 percent increase. The budget proposal projects that revenues will rise by 4.7 percent to $1.92 trillion. That would leave a deficit of $304 billion for 2004.
The president also sets aside a large increase for the government's newest agency, the Department of Homeland Defense, created just 10 days ago, which would see its spending rise to $23.9 billion in 2004, an increase of 8 percent over the amount expected to be spent this year.
Other favored initiatives in the president's budget include education for disabled students, aid to school districts serving large numbers of poor students and a global AIDS initiative, veterans health care and assistance for U.S. allies in the fight against terrorism.
Outside of the favored programs, hundreds of other government agencies would be forced to make do with increases of around 2 percent, essentially in line with expected inflation.
"One conclusion is inescapable: The federal government must restrain the growth in any spending not directly associated with the physical security of the nation," Mr. Bush's budget book states.
CBS News Correspondent Bob Fuss reports that the new budget arrives as Congress is still struggling with the old one. Emergency measures have funded the government since October and there is no quick end in sight for the budget fights.
The Senate passed a huge budget bill last month, but it shifts things around to provide more money for drought relief, education and homeland defense and it's not clear if the House will go along. And they can't really do much with this new budget, until the old one is finished.