The largest unknown in the Senate’s calculation of its budget resolution is the cost of the war on Iraq – will it be $40 billion or $400 billion? The administration, saying there were too many variables to consider, did not include any cost in its budget. But as the Senate debates the size of the president’s proposed tax cut, it should be clear that war costs matter to the size of the deficit and the future ability of Congress to address pressing reforms of Medicare and Social Security.

That means the tax cut should be as small as possible and as directly stimulative as possible. Congress is worried only about the total size of the cut for now – it should aim for zero until after the war costs are clear or, failing that, accept the next-lowest likely option. That would be the package produced by Senate centrists, including Sen. Olympia Snowe, at $350 billion over the next decade.

Sen. Susan Collins has raised valid questions about that middling cut – the president proposed $726 billion – and debated between waiting until a clearer budget picture emerged or supporting the president’s number, if not his specific proposals, to ensure a cut large enough to make a difference in the economy. These are fair points, although if the $726 billion figure is passed, according to the Center for Budget and Policy Priorities, it would cost the federal budget $2.7 trillion over the next decade, likely killing social reforms and certainly driving up the deficit. And if the president’s figure is passed, there will be heavy pressure to support the plan intact, compared with the $350 billion plan, in which the specifics of what goes into the package would be in play, creating possibilities for tax relief that should include relief on the state level.

Sens. Snowe and Collins each have introduced state fiscal relief – Sen. Snowe’s is through flexible block grants for state and local education, health care and homeland security; Sen. Collins has reintroduced a plan for improved Medicaid reimbursements, which was broadly supported last year in the Senate but rejected in the House. The two proposals are not necessarily in opposition, although it is difficult to imagine both passing separately. The two senators met yesterday with colleagues and co-sponsors Sens. Charles Schumer and John Rockefeller to work on ways of combining their proposals, an excellent move.

In voting on the budget resolution and the size of the tax cut and growth package, senators should focus on a plan that emphasizes short-term aid to the states, produces immediate results and remains affordable long-term. Waiting until they know what the war and its aftermath are likely to cost makes the most sense; failing sufficient votes for that, Maine’s senators should support the next lowest, likely number and make sure the money in the package produces the largest immediate effect.