Like Drunken Sailors, Part MMCCXVIII: Congress, and the president, just can't -- won't -- stop spending.

Before Congress departed for its August recess, conservatives suffered a series of budget-policy setbacks -- each of which dramatized the sudden ascendancy of big-government Republicanism in Washington.

-- All but 19 House Republicans voted to approve the Medicare prescription-drug bill, the biggest new entitlement program since the 1960s; the Senate passed an even more expensive version. Economic forecasters say the bill will add another $5 trillion of unfunded liabilities to the system -- the equivalent of doubling the national debt with one stroke of the pen.

-- The White House Office of Management and Budget projected a deficit of $455 billion this year, and nearly $500 billion in 2004.

-- The House of Representatives approved a $10 million expansion of the National Endowment for the Arts. For nearly a quarter-century, Republicans have been pledging to eliminate this program outright.

Now let's engage in a quick thought-experiment. Imagine that Al Gore and a Democratic Congress were doing all this profligate spending. Would conservatives stand for it? In fact, none of this budget-bloating is being perpetrated by Democrats (though they are willing accomplices). Fiscal sanity is in retreat, under a solidly Republican regime.

"The votes for fiscal-conservative policies have completely disappeared, even within our own Republican caucus," grouses Rep. Pat Toomey of Pennsylvania. Another of the few remaining budget hawks in the House, Jeff Flake of Arizona, moans that "almost every vote we take on the House floor is to expand the size of the state. Almost none are to make it smaller." Things have gotten so bad in the House that after Republicans approved a $400 billion spending bill earlier this year -- one filled with absurd programs like the Cowgirl Hall of Fame and sweet-potato research -- the GOP leadership brazenly released a manifesto urging members to go back home and boast about the pork.

As a consequence, we are witnessing the worst three-year run-up of the deficit in history. Also, according to a new Cato Institute report, the domestic discretionary budget -- which is where you find the low- hanging fruit of the federal government, like Amtrak and "corporate welfare" -- grew by more than 12 percent last year. It is expected to rise by another 12 percent, or more, this year.

The $1.8 trillion budget that President Bush inherited from President Clinton has swollen to $2.2 trillion -- in an era of almost no inflation. The White House has yet to call for the elimination of even one major government program, and the GOP Congress has happily gone along. We have certainly come a long way from the days when Barry Goldwater declared that he wanted "not to inaugurate new programs, but to cancel old ones."

The Republican failure to cut spending stands in stark contrast to the Bush administration's stellar record in chopping anti-growth taxes. In the Reagan years, supply-siders forecast that we would eventually grow our way out of budget deficits, and they were soon proven correct: With 4 percent real economic growth and 3 percent spending growth each year, tax revenues caught up with and surpassed federal expenditures. But on the new spending path Republicans have put us on, we would need about 8 percent economic growth for six straight years to get close to a balanced budget.

In Bush's defense, it should be noted that the war on terrorism has carried with it a hefty price tag, and that includes the Iraq campaign. The White House is right that a lot of the domestic-spending bulge is for necessary homeland-security measures. But at the same time, the huge burst in education spending, the hike in farm aid, and, of course, that colossal new entitlement, the prescription-drug bill, are wholly unrelated to national security. The administration's central failing in economic policy may be its unwillingness to set and enforce spending priorities. In almost every national-security crisis in U.S. history, the demand for more guns has meant less spending for butter; this administration has approved large budget increases for both.

The White House should start worrying about the political implications of its expanding budgets. On July 26, a group of 20 top conservative leaders from organizations including Cato, the Heritage Foundation, the American Conservative Union, and the Eagle Forum assembled to launch a counteroffensive.

"Conservatives and libertarians cannot be silent on this disgraceful growth of government, simply because it is Republicans who are doing all the spending," fumed Cato president Ed Crane. Everyone in the room nodded in agreement.

Undoubtedly, the most immediate priority for conservatives is to stop the runaway-train drug bill. At stake here is whether Republicans will bust the Treasury the way Lyndon Johnson did in 1965, by creating a Medicare program that now costs five times what it was expected to. A Heritage Foundation report finds that the drug bill would be so expensive that further tax cuts would be politically impossible for at least another decade. This is the biggest battle between statism and free-market policies in Washington since the Clintons' only slightly more grandiose health legislation went down in flames ten years ago.

Equally important for rolling back big government is the crusade to create a private-investment option for Social Security. President Bush is on the right side of this issue; I believe the White House is sincere when it says that this would be the top domestic priority for a Bush second term. (For this reason alone, Bush needs to be resoundingly reelected.) "People forget that Social Security is nearly 25 percent of the whole federal budget," says Mike Tanner, Social Security expert at Cato. If the drug bill is Pearl Harbor for Republicans, Social Security privatization is the Allied landing at Normandy.

Next is the problem of fixing the budget process, which for too long has tilted in the direction of ever more obese budgets. Imagine trying to win a game of Monopoly with an opponent who assigns himself the role of banker, and continually slips wads of $500 bills to himself under the table. That is essentially the modern-day federal budget process, where we have assigned the role of banker to the appropriators -- the very ones who have been pre-selected for their desire to break the bank (it's very hard for a fiscal conservative to get on the Appropriations Committee). "The incentive structure of the budget process is, and has been for at least 30 years, to spend money, never to save it," laments former House budget chief John Kasich.

Republicans should scrap the 1974 Budget Act in favor of one that eliminates current-services budgeting (which builds in automatic budget increases every year). They should also impose a Colorado-style expenditure-limitation measure capping spending at population plus inflation each year; impose six-year-term limits on service on the Appropriations Committee; and sunset federal agencies every five years so that failing bureaucracies don't survive owing to mere inertia. This actually happens. The paid "volunteer" program called AmeriCorps has been graded a failure by one government report after another; only about half of its missions succeed, and there has been widespread theft and fraud. Yet somehow the program's budget has been doubled in ten years. We now have a perverse system in which tax cuts automatically expire after a decade, but spending programs live forever.

Congress should also require that all new spending programs be approved by a newly created committee that would certify whether the program is permissible under Article I, Section 8, of the Constitution. As much as 80 percent of what Congress spends money on is outside the bounds of the original intent of the enumerated-powers clause. It's not an oversight, for example, that the word "education" appears nowhere in the Constitution; the Founders never envisioned that Congress would or should spend money on schools -- a state and local function -- or, for that matter, to bail out industries or line the pockets of wealthy farm businesses.

Yet another pressing task is to crack down on Uncle Sam's financial malfeasance. A new General Accounting Office report indicates that taxpayers are being defrauded of billions of dollars by ineptitude, mismanagement, and fraud at government agencies. In 2002 the Agriculture Department sent out $1 billion in food stamps to people who don't qualify; as many as 45 percent of the school-lunch payments are similarly erroneous. The Medicare system had an error rate of 6.3 percent in payments (believe it or not, that was an improvement from previous years), thus bilking taxpayers out of $13.3 billion. The Pentagon can't account for over $10 billion it spent last year; the Education Department sent out $400 million in fraudulent student-aid checks; the list could go on and on. Here's a quick way to save tens of billions of dollars a year: establish a policy that any agency unable to pass a basic audit is disqualified for a budget increase in the following year.

Alas, all of these structural reforms are predicated on the assumption that Republicans actually want to control the bulging federal waistline. And any reorientation of the party ethic from spending money to saving it depends on President Bush himself. He has proven time and again that he has a singular capacity to lead the party; he needs to understand that restoring fiscal discipline is a much higher priority right now than giving free drugs to the richest age group in America.