- The Washington Times - Wednesday, March 21, 2001

The Republican-led House will move today and tomorrow on President Bush's legislative priorities, including the second phase of his tax-cut plan, amid few signs that Democrats are willing or needed to get on board.

"We're in good shape," House Majority Leader Dick Armey said of the president's agenda, adding that he expects little help from Democrats.

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However, Mr. Armey stressed that some Democrats may reluctantly support the legislation when House committee members vote on it. "If the legislation has good standing with the American people, in the end the Democrats will vote for it," he said.

The House Budget Committee begins its work on the new federal budget, mindful of Mr. Bush's goal of limiting the overall increase in government spending to 4 percent and trying to squelch calls within the Republican Party for billions more in agriculture and defense spending.

Democrats, meanwhile, are trying to mount opposition by arguing that the president's budget rolls back funding for children's services and does not devote enough for education.

Republicans today also will introduce Mr. Bush's faith-based initiative that would give religious organizations access to federal money to deliver social services.

The House Ways and Means Committee could take up the next installment on Mr. Bush's $1.6 trillion tax-cut plan as early as tomorrow. The committee is holding hearings today on all of Mr. Bush's proposal.

The bill, written by Chairman William Thomas, California Republican, includes substantial tax breaks for married couples and a retroactive increase to the child credit, according to a source familiar with the plan.

The largest single tax break would increase from $43,850 to $52,500 the amount of a married couple's income that is subject to the lowest tax rate. That break, however, would start to take effect only in 2004, and would take six years to be fully phased in.

The bracket change is a departure from the Bush tax plan, which included a deduction for married couples with two incomes as a way to reduce the so-called marriage penalty. The Thomas plan would help all married couples regardless of whether the current tax code hurts or helps them.

The plan would also increase from $7,350 to $8,800 the standard deduction for married couples, and expand the Earned Income Tax Credit for married couples.

The child credit would be increased retroactively from $500 to $600 and eventually to $1,000.

Also tomorrow, the House Education and the Workforce Committee will hold a hearing on education spending for the upcoming fiscal year, including Mr. Bush's proposal to increase such spending by 11 percent.

Despite across-the-board progress on the president's legislative plans, Mr. Bush faces hurdles, some of them within his own party. House Republican leaders were busy yesterday trying to appease lawmakers who want up to $8 billion more for agriculture spending and $2.5 billion more for defense than the president included in his budget blueprint for fiscal 2002.

The problem, Republican sources say, is the tantalizing $500 billion "contingency fund" that Mr. Bush has set aside for emergencies.

"We're arguing about the gravy," said a senior House Republican aide. "This is the point of greatest leverage for Republicans to get as much additional spending as they can."

The aide said the White House has not lobbied these Republican lawmakers aggressively enough to back away from extra spending and may be relying too much on Vice President Richard B. Cheney as the administration's "closer" to clinch floor votes.

Said another Republican leadership staffer, "If we start appeasing the defense hawks and the 'aggies,' we'll never keep [the spending increase] to 4 percent."

Still, the prevailing attitude among Republican leaders yesterday was that the party's lawmakers will fall in line for the president's budget. Mr. Armey, Texas Republican, predicted a vote on the House floor next week.

Meanwhile, House Democrats, only 10 of whom voted for Mr. Bush's first major agenda item of tax-rate cuts, said yesterday that the president's education budget does not devote enough money for repairing schools or reducing class sizes. They called for $282 billion to be spent over the next 10 years on education and for reducing the size of the president's tax cut.

"We make better use of the extra tax benefits the president bestows on the most well-off 2 percent of American taxpayers by instead investing those resources in a major overhaul of American education," said Rep. David R. Obey of Wisconsin, ranking Democrat on the House Appropriations Committee.

House Budget Committee Chairman Jim Nussle, Iowa Republican, veered slightly yesterday from the president's budget plan in a preview of his own plan while discussing it with reporters.

Mr. Nussle's tax-cut plan would provide $20 billion more in tax relief than the president and phases in more of the cuts in earlier years.

His plan also spends $1.2 billion more for special education than Mr. Bush proposed, but assumes no revenues from leasing parts of the Alaska National Wildlife Refuge for petroleum production.

Following the president's lead, though, the House budget includes no specific recommendation for the federal government's contribution to the District of Columbia's budget.

• John Godfrey contributed to this report.

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