Budget Would Torpedo Bush's Tax Cuts

The Senate rejected calls from both parties' presidential candidates to take an election-year break from pork-barrel spending as a Democratic-run Congress passed budget plans that would torpedo hundreds of billions of dollars in tax cuts won by President Bush.

John McCain, the GOP nominee-to-be, couldn't attract even a majority of Senate Republicans to vote with him Thursday night behind the earmark moratorium touted by party conservatives as a way to restore the GOP's credibility with voters.

It failed on a 71-29 vote. Only three Democrats joined with Hillary Rodham Clinton and Barack Obama in voting for it.

The underlying House and Senate Democratic federal budget plans for 2009, though nonbinding, drew blasts from Republicans for allowing some or all of Bush's tax cuts to die in about three years.

The House passed its $3 trillion budget plan by a 212-207 vote. It would provide generous increases to domestic programs but bring the government's ledger back into the black, but only by letting all of Bush's tax cuts expire at the end of 2010 as scheduled.

The Senate passed a companion plan by a 51-44 vote. It endorsed extending $340 billion of Bush's tax cuts but balked at continuing all of them. The competing versions head to talks in which the House is all but certain to accept the Senate's position endorsing tax cuts for the working poor, married couples, people with children and for those inheriting large estates.

All three major presidential candidates interrupted their campaigns for a Senate vote-o-rama that began before noon and included more than 40 roll calls. Maine Republicans Susan Collins and Olympia Snowe crossed over to support the bill; Evan Bayh of Indiana was the sole Democrat to vote no.

Budget plans are nonbinding, but they highlight the difficult choices on taxes and spending facing the next president and Congress. Binding votes on the expiring Bush tax cuts will be left to his successor and the Congress that's elected in November.

The practice of inserting "earmarked" spending into legislation is seen by lawmakers in both parties a birthright power of the purse awarded to Congress by the Founding Fathers.

Earmarks have exploded in number and cost in recent years, accompanied by charges of abuse and public outrage over egregious examples like the proposed "bridge to nowhere" in Alaska, which would have cost more than $200 million to serve an island with a population of about 50.

McCain, who has battled with members of both parties over them for years, blamed pork barrel spending for the Republicans losing control of Congress in the 2006 elections.

"This may be the last bastion in America where they don't get it," he told reporters after Thursday night's vote. "Americans are sick and tired of the way we do business in Washington. As president, I promise the American people ... the first earmarked, pork-barrel bill that comes across my desk, I'll veto it."

However, on taxes, the Arizona Republican voted to extend the full roster of Bush's tax cuts, which he opposed seven years ago as being tilted in favor of the wealthy.

Democratic rivals Clinton of New York and Obama of Illinois both voted to extend only some of Bush's tax cuts while allowing cuts in income tax rates and investments expire. They joined other Democrats in a 52-47 vote against extending $376 billion of them.

Republicans hope to use the votes as fodder for the heated presidential campaign and for congressional races. "Democrats are quietly but very assuredly paving the way for a massive, economy-choking, tax increase," said Rep. Jim McCrery, R-La.

Democrats said the plans would reverse years of deficits that have piled up during Bush's tenure. They said he squandered trillions of dollars in projected surpluses that he inherited in 2001.

"The Democratic budget continues to move our nation in a new direction and to clean up the fiscal train wreck caused by failed Republican economic policies over the last seven years," said House Majority Leader Steny Hoyer, D-Md.

Democrats argued that when the time comes, they'll renew tax cuts aimed at the middle class by closing billions of dollars worth of corporate and other tax loopholes. They also say billions more can be raised by cracking down on tax cheats.

In the House, Democrats defeated a GOP plan that would have extended Bush's reductions. The Republican plan also would have eliminated the alternative minimum tax, which was originally designed years ago to make sure rich people pay at least some tax but now threatens more than 20 million additional taxpayers with increases averaging $2,000.

Some 38 mostly moderate Republicans voted against their party's plan, which would have made cuts in popular programs like Medicare, housing, community development and the Medicaid health care program.

Congress' annual budget debate involves a nonbinding resolution that sets the stage for later bills affecting taxes, benefit programs such as Medicare and the annual appropriations bills. Unless such follow-up legislation is passed, however, the budget debate has little real effect and is mostly about making statements about party priorities.

This is such a year. Congress rarely tackles difficult budget issues as elections loom, and a standoff with Bush means that Democrats may even take a pass on advancing the 12 annual appropriations bills.

The first year of an administration is typically when heavy lifting on the budget is done, but all the candidates' campaign plans seem to promise more than they can deliver. McCain's tax cuts would require applying a meat cleaver to spending, while the Democrats promise spending that would enlarge the deficit or require large tax increases.

The White House forecasts the deficit for the current year at $410 billion, a near record.

Democrats trumpeted their plan for putting the budget back in balance while also making investments in infrastructure, education, community development, clean energy and other programs. It also would avoid $196 billion worth of Bush-proposed cuts to Medicare and the Medicaid health care program for the poor and disabled.

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The bills are H. Con. Res. 312 and S. Con. Res. 70.

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On the Net:

House Budget Committee: http://budget.house.gov

Senate Budget Committee: http://budget.senate.gov