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After forcing through nearly $50 billion in budget cuts in an early morning vote, House Republican leaders put off a fight over $56 billion in tax breaks on Friday as the House and Senate rushed to close up shop after weeks of party infighting and battles with Democrats. As they scrambled to tie up loose ends before a Thanksgiving break, Congressional leaders also temporarily abandoned efforts to reach agreements on other contentious legislation, including a renewal of the antiterrorism law known as the USA Patriot Act and spending bills for health and education programs and the Pentagon.
Several House Republicans encouraged the leadership to delay the vote on tax breaks, fearing the political symbolism of approving tax benefits for investors and other affluent Americans just hours after narrowly winning passage of a budget attacked by Democrats for its limits on programs for the poor. Party leaders said they decided it was time to head home after a grueling day on Thursday in which Republicans eked out a 217-to-215 victory on the budget cuts after an embarrassing defeat on a spending bill. ''I don't think the members are ready to stay here until 2:00 in the morning another day, and we'll do this when we get back,'' said Representative Roy Blunt of Missouri, the No. 2 Republican and floor leader. The Senate also cleared its desk, approving two spending bills after senators adopted their own package of $60 billion in tax cuts early Friday. The White House quickly threatened a veto of the Senate's tax plan because it contains a one-year, $5 billion windfall profits tax on the nation's biggest oil companies. The White House also expressed its strong displeasure at a provision that would raise $15 billion over 10 years from companies and people who use certain kinds of tax shelters. And it was dismayed that the Senate omitted one of President Bush's top economic priorities of the year, an extension of his 2003 tax cut on stock dividends and capital gains. While House Republicans celebrated the narrow budget victory, nearly six weeks in the making, they face a difficult time in reaching a final agreement with the Senate because of differences in their approaches. The Senate backed a plan that would open the Arctic National Wildlife Refuge in Alaska to oil drilling. But House leaders were forced to strip that element from their bill to win the support of moderates who say they have enough votes to block any final plan that includes drilling. Speaker J. Dennis Hastert of Illinois, who promised quick action on the tax cuts when the House returns in early December, said Republicans would confront the budget challenge later but first wanted to savor Friday's victory after weeks of tumult in their ranks on spending and taxes. ''We got through the first round,'' Mr. Hastert said. ''You've got to get through the first round before you get to the championship. And we hope we're getting there.'' In their push for greater budget cuts over the next five years to mollify conservatives, the House leadership had to soften the impact of the measure on food stamp recipients and poor Americans who rely on Medicaid in order to win votes from Northeastern Republicans and other centrists who were balking. ''The final product reflects a lot of hard work on the part of moderates,'' said Representative Sherwood Boehlert, Republican of New York. In the end, 14 Republicans joined 200 Democrats and an independent in opposing the budget plan backed by 217 Republicans. Its backers portrayed it as a modest effort to slow the growth in federal spending while making overdue changes to a wide range of benefit programs that have been exploding in cost. Critics said that it took too great a toll on Americans who rely on federal aid and that any savings would be consumed by the proposed tax cuts. Despite some anxiety among moderates over the tax cuts, Mr. Hastert said that he intended to move ahead with the plan when the House comes back and that he wants to hold to the lower rates on capital gains and stock dividends. ''We want to continue to create jobs in this country,'' he said. ''I think that's an important piece of that legislation.'' Even if the House succeeds, Senate and House Republicans have developed almost entirely different tax-cutting bills, in part because Senate Republicans made concessions to Republican moderates and Democrats who balked at cutting taxes mainly for the wealthy. The Senate bill provides for more than $80 billion worth of tax cuts over the next five years. But it also includes about $20 billion worth of tax increases, like a steep one-time tax on oil companies and a measure that would give prosecutors a new tool to impose heavy penalties on people who avoid taxes with accounting schemes that lack ''economic substance.'' The House and Senate approved final spending bills covering veterans' spending and military construction as well as transportation, treasury and housing programs and were trying to resolve last-minute procedural snags. In writing the treasury measure, negotiators dropped a Senate plan to block annual pay raises for Congress, clearing the way for a $3,100 pay increase. Major spending measures for health and education programs -- the bill defeated Thursday in the House -- and the military are snagged in disputes and will not be considered until next month at the earliest; spending for those agencies is covered under a stop-gap bill. Congress also put off until December legislation to extend the USA Patriot Act, the antiterrorism law passed by Congress in the wake of the Sept. 11 attacks. With Senate Democrats and some Republicans threatening to filibuster the measure, Senator Arlen Specter, Republican of Pennsylvania and chairman of the Senate Judiciary Committee, said his colleagues needed more time to review a draft produced by House and Senate negotiators. The main sticking point, Mr. Specter said, was a dispute over
a ''sunset provision'' that would permit the extension to remain in
effect for seven years without Congressional action to renew it.
Democrats, including Senator Patrick J. Leahy of Vermont, want the
period shortened to four years. Mr. Specter said he hopes to reach a
compromise after the Thanksgiving recess.
Photo: Senator Arlen Specter, left, said
senators needed more time to study a plan on extending an antiterror
law. (Photo by Stephen Crowley/The New York Times)
HOUSE: $6.2 billion. Raises employers' pension insurance premiums.
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Copyright 2005 The New York Times Company | |
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