December 7, 1995 in Nation/World

President Vetoes Republican Bill To Balance Budget Clinton Accepts 7-Year Plan, Rejects Big Cuts In Social Programs

William Neikirk And Steve Daley Chicago Tribune

President Clinton on Wednesday vetoed the landmark Republican plan to balance the budget in seven years with a slap at GOP priorities but grudging acceptance of the timetable.

With the same pen former President Lyndon Johnson used to sign the Medicare bill into law 30 years ago, Clinton struck down a plan he said contained “the biggest Medicare and Medicaid cuts in history, deep cuts in education, a rollback in environmental protection and a tax increase on working families.”

He called the GOP blueprint extreme and said it would cause the United States to be weaker and more divided.

Clinton said he would submit today his own detailed seven-year balanced budget plan designed to protect these programs. It will also cut spending on welfare by nearly $50 billion and slash a host of domestic discretionary programs by $250 billion.

This was a concession by the White House. The president had proposed a 10-year balanced budget plan earlier but later agreed to a seven-year timetable only if it could be worked out in negotiations and if his priorities could be preserved. Now, Clinton is coming to the table with his own plan.

“We had better see some seriousness of purpose on the other side,” said White House Press Secretary Mike McCurry.

In acknowledging the administration’s concessions to the Republican Congress with the seven-year plan, McCurry said, “This is about all you can do, the president believes, without doing serious damage to the American people.”

Republicans swiftly criticized the Clinton veto and said he wasn’t truthful about what was in the bill, especially education and environmental spending.

Republican leaders were clearly miffed by what they saw as Clinton’s grandstanding and gimmickry in using the LBJ pen and his tough rhetoric in attacking their budget plan.

“Instead of leading, instead of governing, he played games with the American people,” House Speaker Newt Gingrich, R-Ga., said. “The fact is the president needs to recognize that Lyndon Johnson’s Great Society has failed. The people know that a Washington-based, Washington-spending, Washington bureaucracy, Washington red-tape Great Society isn’t the answer.”

With the veto, negotiations be tween the White House and Congress over how to balance the budget are likely to become more earnest, and have a greater chance to succeed. But both sides are still far apart.

Many federal agencies will run out of money on Dec. 15 unless a third stopgap spending bill is approved. Republican negotiators have hinted that an accommodation could be reached before the deadline.

Last week, Senate Majority Leader Bob Dole, R-Kan., suggested he would oppose shuttering the government and furloughing thousands of “non-essential” federal workers before the Christmas holidays.

On Wednesday, however, Sen. Phil Gramm, R-Texas, Dole’s principal rival for the GOP presidential nomination took a harder line, insisting that Republican leaders not back away from the possibility of another partial shutdown.

Speaker Gingrich’s troops in the House are even less inclined to compromise, fearing that they will move into next year without having delivered on their 1994 campaign promise of a balanced budget plan and a tax cut in this Congress.

Though Clinton’s veto had been expected, it was a significant political event. It enabled him to define himself by contrasting himself with Republicans. But it also put him in the ticklish position of rejecting the first balanced budget to come before a president since 1968.

A senior administration official said the president’s middle-class tax cut likely will not be scaled back, even though some Democrats on Capitol Hill have been pushing it.

“The basic architecture of the president’s previous balanced budget plan will remain intact,” the official said, but he added that many departments will be hit with some “painful cutting.”

Another source of revenue will come from optioning communications frequencies, the official said.

The administration also will accept a new cost-of-living adjustment in federal benefit programs that would reduce the annual inflation increase by 0.4 percent of what it would otherwise be. This recommendation came from the Bureau of Labor Statistics in a new calculation of the Consumer Price Index.

Clinton stuck by his plan to cut the Medicare program by $124 billion over seven years. Most of the money would come from reductions to providers such as doctors and hospitals, but the president would also raise the premium for Part B of Medicare to $77 per month over 7 years compared with $88 a month under the Republican plan.

“With this veto, the extreme Republican effort to balance the budget through wrongheaded cuts and misplaced priorities is over,” the president said.

Conservative Democrats offered a seven-year budget plan earlier this year that essentially split the difference between the GOP measure and Clinton’s 10-year budget on spending, but contained no tax cuts.

Thoughts and opinions on this story? Click here to comment >>

Get stories like this in a free daily email