Alan Greenspan’s criticism of the administration’s fiscal record couldn’t have come at a better time. The former Federal Reserve chairman’s autobiography, “The Age of Turbulence,” lays into President Bush and congressional Republicans for their free-spending ways. The criticism seems to have emboldened Bush just as Democrats challenge him on taxes and spending.

Speaking at a press conference last week, Bush repeatedly hit congressional Democrats for proposing tax hikes and spending increases. The new hard-line attitude, something missing when Republicans controlled Congress, is refreshing for conservatives seeking a return to fiscal restraint.

“The worst decision the Congress could make would be to raise taxes,” Bush said. “We don’t need to raise taxes in order to fund budget priorities.”

When asked about the economy, Bush was even more adamant. “I’m optimistic about our economy,” he said. “I would be pessimistic, however, if the Congress has its way and raises taxes. I believe the worst thing that can happen now is to allow the Congress to do that which they have said they want to do, which is to raise the taxes on people.”

Taxes may be one thing, but Bush also came out strongly against additional government spending -- specifically the proposed $35- to $50-billion expansion of the State Children’s Health Insurance Program, SCHIP for short. Add in 12 appropriations bills awaiting resolution -- all threatening to exceed the president’s spending recommendations -- and the stage is set for the biggest budget showdown since then-Speaker Newt Gingrich challenged President Bill Clinton to shut down the government in 1995.

All of this activity has led the mild-mannered Greenspan to offer Bush some blunt advice: Dust off the veto pen.

“My problem with the president is that he did not use the veto sufficiently,” Greenspan said last week on Fox News. “He’d better start vetoing certain stuff.”

Bush appears ready to flourish that veto soon if Congress doesn’t change course on the SCHIP bill. Originally intended to cover poor children whose folks can’t afford private health insurance, SCHIP would be transformed into a new middle-class entitlement program under a proposal expected to be approved by Congress next week. Under this massive expansion, families earning up to $83,000 per year would be eligible for “free” government coverage for their kids, turning it into HillaryCare lite. Continued...