U.S. House approves budget, but Senate poised to reject it

WASHINGTON – The House on Wednesday approved a $2.4 trillion budget for fiscal 2005 that would extend popular tax cuts and increase spending on defense and homeland security.

The bill, which passed 216-213, was the result of an agreement between GOP leaders in the House and the Senate.

But the Senate appears to be on the verge of defeating the same measure in a vote scheduled for today. Several Republican senators concerned about the deficit are likely to join most Democrats in rejecting the bill because it does not include a provision requiring Congress to make spending reductions to balance every tax cut and spending increase.

In the House, nine Republicans joined all the Democrats and one independent in opposing the bill. Five House members – two Democrats and three Republicans – did not vote.

Even if the Senate rejects the legislation, the House will use it as a guideline for spending bills it drafts later this year, said Sean Spicer, spokesman for the House Budget Committee.

However, the likely failure of the House and the Senate to agree on a budget framework shows how difficult it has become in an election year for the two chambers to work together, even though Republicans hold majorities in both.

Republicans said their budget would keep the economy strong and put the nation on a path toward balanced budgets.

“I think our budget can be summed up in one word – responsible,” said Rep. Christopher Shays, R-Conn.

Democrats assailed the bill’s sponsors for failing to tackle the growing deficits.

“Year after year we’re stacking debt on top of debt,” said Rep. John Spratt, D-S.C.

White House officials praised the House vote, even though Congress ignored President Bush’s request to make permanent all of the tax cuts passed in 2001.

The budget bill reflects an agreement reached Monday between House and Senate Republicans after six weeks of debate. The two chambers quickly agreed on spending amounts but clashed over whether to include a provision to force fiscal discipline by requiring Congress to pay for each tax cut or budget increase with spending reductions.

Such a provision was in effect from 1990 until it expired in 2002. The Senate wanted such a provision and the House did not. The agreement adopts it for only a year and allows up to $28 billion in tax cuts without corresponding spending reductions.

This agreement did not go far enough to appease the Republican senators who have been demanding the provision, including Sens. John McCain of Arizona, John Chaffee of Connecticut, and Olympia Snowe and Susan Collins of Maine, according to their press secretaries.

Budget analysts said the budget failed the fiscal discipline test.

“It’s sort of like going on a diet and saying I’m going to exempt everything I eat for lunch and my diet is going to end at midnight,” said Robert Bixby, executive director of the Concord Coalition, a budget watchdog group.

Under the budget framework, the deficit is expected to peak in 2004 at $474 billion and drop to $367 billion the following year. Bush took office in 2001 with a budget surplus estimated at $5.6 trillion over 10 years.

The bill allots $402 billion in fiscal year 2005 for military spending, an increase of 7 percent, plus $50 billion for additional costs for operations in Iraq and Afghanistan. It provides a 14 percent increase in spending on homeland security, but freezes spending on discretionary domestic programs at 2004 levels.