- The Washington Times - Thursday, March 9, 2006

ASSOCIATED PRESS

A Senate panel yesterday approved a scaled-back version of President Bush’s budget, shorn of signature initiatives such as tax relief and cuts to federal benefit programs such as Medicare.

With Republicans nervous about cutting popular programs in an election year and still nursing wounds from a bruising round of benefit cuts last year, the Budget Committee voted 11-10 along party lines to approve the budget.

Budget Committee Chairman Judd Gregg, New Hampshire Republican, dropped Mr. Bush’s proposals for expanding tax-free medical accounts and restraining Medicare spending. He also seeks to shift about $5 billion from the Pentagon and foreign aid budgets to cash-strapped domestic programs such as education and homeland security.

The measure heads to the Senate floor Monday, but with congressional election-year anxiety running high, there is no guarantee the full Senate will pass the Republican budget blueprint.

“I’m not going in with the votes, I can tell you that much,” Mr. Gregg told the Associated Press. “There’s a high level of angst and indecision out there.”

His plan would produce a $359 billion deficit next year. Deficits would drop to $177 billion by 2011.

Democrats castigated Mr. Gregg’s plan, saying it would produce those lower deficits only by leaving out the long-term costs of the war in Iraq and the price of establishing Mr. Bush’s Social Security personal accounts and failing to address the ever-increasing effect that the alternative minimum tax is having on middle-class taxpayers.

“Now is the time that cries out for bold action,” said Sen. Kent Conrad, North Dakota Democrat. “We need to reduce our deficits and rein in the exploding debt that continues under this plan.”

But most of the Democratic amendments offered yesterday would increase spending on a variety of programs, including veterans’ medical care, ports security and firefighter grants. They were rejected in votes yesterday afternoon.

Mr. Gregg’s plan hasn’t won much better reviews from Republicans, including Pete V. Domenici of New Mexico, Lamar Alexander of Tennessee and John Cornyn of Texas.

They said it failed to address the spiraling long-term growth of Social Security, Medicare and other benefit programs that threaten to swamp the budget with the retirement of the baby boom generation.

“Unfortunately, the [budget] does not … help Congress reform such programs as Medicaid and Medicare, which both grow at average rate of around 8 percent each year through 2015 and will continue to eat up more of the total federal budget,” Mr. Cornyn said.

It is not clear whether the House and Senate will be able to agree on a final budget, even assuming the Senate passes its plan next week.

The House has postponed work on its version until late this month at the earliest; the modest Senate plan may not go far enough for conservatives in the House.

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