WASHINGTON – The Senate delivered a wartime rebuff to President Bush’s domestic plans Wednesday, approving a $2.2 trillion budget that provides less than half the $726 billion in tax cuts he wants to rally the listless economy.
The Republican-controlled chamber used a mostly party-line 56-44 roll call to approve the fiscal blueprint, which endorses just $350 billion of the president’s planned tax cuts through 2013. That vote came after moderate GOP senators joined Democrats to fend off, by 52-48, a last-ditch Republican attempt to add $67 billion back to the tax reduction package.
The final say on the budget’s tax-cutting figure will come when House-Senate bargainers work out a compromise tax-and-spending framework. The Republican-led House approved its own budget last week embracing Bush’s entire $726 billion tax-cutting economic plan, and GOP leaders are sure to drive the tax figure in their compromise as high as they can.
Even so, the Senate budget was an unambiguous setback for Bush on one of the pillars of his domestic agenda. It also spotlights the limits on Bush’s abilities to persuade lawmakers to support his policies at home, even though the war with Iraq has helped keep his popularity high.
“There are just differences that on a bipartisan basis Congress has had with the administration” over taxes, the economy, environment and other issues,” Senate Minority Leader Tom Daschle, D-S.D. told reporters before the vote. “I don’t think, war or no war, those differences would be any differently reflected.”
In a written statement, Bush said it was unfortunate that the Senate’s tax number fell shy of his own.
“We will work to ensure that the final House-Senate budget provides the growth measures American workers deserve,” he said.
“The growth package is not what I want,” said Senate Budget Committee Chairman Don Nickles, R-Okla. “I think it’s about half a loaf. That’s better than none.”
Sens. Olympia Snowe and Susan Collins of Maine both supported the final budget resolution.
Snowe was one of three Republicans who on Tuesday supported an amendment that reduced the proposed Bush tax cut.
After the budget resolution passed in the Senate on Wednesday, Snowe stressed the importance of getting House lawmakers to agree to the smaller tax cut.
“Conferees should be guided by the Senate’s action, which I believe represents an important agreement on the proper size of a tax cut that could pass the Senate,” Snowe said.
The Senate version of the budget includes funding for numerous proposals that would benefit Maine, Snowe said, ranging from a more than 20 percent boost in shipbuilding accounts, including three Aegis destroyers of the type built at Bath Iron Works, to funding of local homeland security priorities and investments in health care.
Snowe also voted Wednesday to increase funding for education costs – including special education and the “No Child Left Behind” act – by $7 billion, so the Senate budget ultimately will include $8 billion in new funding to help states and communities address education priorities.
“I am disappointed that the budget’s support for education falls short of the full federal share of special education funding I have supported,” Snowe said, “but this amendment represents a significant step forward in meeting our needs.”
Collins said the Senate needed “to pass this budget in order to restore some order to the spending process in Washington. Having a budget, even an imperfect one, is an important step in trying to get our nation’s debt under control. Last year, we failed to pass a budget, and the result was haphazard and chaotic spending.”
Collins said one highlight of the process for her was passage of a resolution she helped introduce to provide fiscal relief to states.
“The Rockefeller-Collins resolution, which passed with an 80-19 vote, recommended $30 billion for the states, at least half of which would be for Medicaid,” she said. “Maine would receive $190 million under this proposal.”
The votes came as Congress begins considering Bush’s $74.7 billion proposal to pay for the war with Iraq and other costs of the U.S. drive against terrorism at home and abroad.
Members of both parties have said a concern about the war’s price tag – and the potentially expensive American role in a postwar Iraq – has helped soften support for Bush’s entire tax plan.
Bush’s economic package was dominated by his proposal to eliminate the taxes stockholders pay on corporate dividends, which lawmakers say is now in trouble. It also would accelerate income tax reductions already scheduled to take effect and enhance some write-offs for businesses.
The administration and its GOP supporters said the tax cuts would recharge the economy by boosting stock values, increasing corporate investment and putting more money into consumers’ pockets. Democrats and some moderate Republicans say the cuts would only worsen federal deficits that seem likely to near a record $400 billion this year, and are the opposite of the sacrifice the government often requires during wartime.
Congress’ budget does not need Bush’s signature and sets overall ceilings on spending and taxes. Final decisions on the size and details of the tax cuts – as well as any spending changes – will be made in later bills.
The budget is significant because it will shield whatever tax-cutting figure lawmakers agree upon from Senate procedural delays or filibusters, which take 60 votes to halt. That means any tax-cutting bill protected by the budget would need only a simple majority, or 51 votes, to pass.
Six Democrats voted for the budget: Sens. Max Baucus of Montana, Evan Bayh of Indiana, John Breaux and Mary Landrieu of Louisiana, Zell Miller of Georgia and Ben Nelson of Nebraska.
Sen. John McCain of Arizona was the only Republican to vote no.
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