Debate Opens On Gop Plan To Cut Deficit But Proposal Favors Wealthy, Democrats Say

The Senate Budget Committee Monday began a historic debate over Republican proposals to eliminate the deficit - including nearly $410 billion of savings in Medicare and Medicaid - amid harsh partisan exchanges that foreshadowed a difficult battle ahead.

Budget Committee Chairman Pete V. Domenici, R-N.M., who will unveil his plan Tuesday for reducing spending by $1 trillion over seven years, declared that balancing the budget and downsizing the government were critical to preserving the nation’s living standard and sparing future generations an intolerable debt load.

“Like a family gathered around the kitchen table, we have made the difficult choices needed to protect and strengthen our future,” Domenici said. “We have been thorough, and we have been fair.”

But even before Domenici presents his plan, committee Democrats, sounding the theme of “class warfare,” charged that Republicans were bent on enacting major spending and tax cuts at the expense of the poor and working-class families.

“We know enough now to call the winners and the losers - the millionaires and billionaires,” said Sen. Barbara Boxer, D-Calif. “The big losers will be the elderly, the children, working families and the environment.”

Sen. J. James Exon (Neb.), ranking committee Democrat, said while Domenici and other moderate Republicans are opposed to tax cuts until the budget is balanced, “The cry to balance the budget is drowned out by the relentless drumbeat to cut taxes for the wealthy.”

The House last month approved a tax cut package that would drain the Treasury of $340 billion over seven years, and conservative leaders in the Senate including Majority Leader Robert J. Dole, R-Kan., and Sen. Phil Gramm, R-Texas, have called for similar cuts in the Senate. Domenici’s budget plan would not allow consideration of a tax cut until Congress enacts a budget plan certified to eliminate the deficit by 2002. Gramm had threatened to press for an amendment in committee providing for a tax package on a par with the House plan, but Monday he said he would postpone his challenge until the budget resolution reaches the Senate floor next week.

The Senate GOP budget plan would freeze or reduce spending for most domestic programs with the major exception of crime programs; scale back spending for welfare and nutrition programs and a variety of agriculture subsidies; eliminate more than 100 federal agencies and programs; spend an average of $270 billion a year on defense, which is more than President Clinton favors; cut foreign aid by a quarter and significantly slow the growth of Medicare and Medicaid.

The Senate GOP plan would restrict the growth of Medicare to 7.2 percent annually, for a projected savings of $248 billion.