House extends Bush’s tax cuts

The House added about $39.5 billion in spending in its last session of the year, passing an extension of President Bush’s tax cuts and fixing the Medicare reimbursement formula for doctors. It also allowed more offshore drilling in the Gulf of Mexico.

The spending measure, which passed 367-45, faces opposition in the Senate, where some said the price tag was too high and loaded with reckless spending provisions.

“This bill is the largest budget-buster ever brought to the floor by the Republican Congress that the Republican leadership has seen fit to ram down the throats of its members,” said Sen. Judd Gregg, New Hampshire Republican and chairman of the Budget Committee.

However, some lawmakers said it was their responsibility to extend the popular tax deductions for middle-income families and tax breaks for teachers and college students.

“House Republicans believe in letting Americans keep more of their hard-earned money, and this legislation does just that,” said House Majority Whip Roy Blunt, Missouri Republican. “Absent today’s action by House Republicans, taxpayers would have been hit with an automatic tax increase totaling more than $35 billion over the next five years.”

The House last night also passed a bill extending permanent normal trade relations to Vietnam and lowering tariffs on fabrics and manufactured clothing imported from Haiti, numerous African nations and several other Third World countries. The vote was 212-184.

The congressional delegation from North Carolina was furious about the trade bill, which it saw as further damaging the already weakened textile and manufacturing industries in the state.

The two measures likely will be merged into one package by the Senate, which is expected to vote today.

Some senators were willing to swallow the costs of the tax bill in exchange for policies necessary to their states.

“This bill doesn’t have everything that many of us would have liked the bill to have, but the things it does have in it are monumentally important,” said Sen. Kay Bailey Hutchinson, Texas Republican, who supported the legislation primarily because it allows voters in Texas to deduct sales taxes on their federal income tax returns.

The House last night also passed a resolution to keep the government running until Feb. 15 after lawmakers failed to approve 10 of the 12 appropriation bills. The resolution also contains a provision that stops the automatic cost-of-living increase members of Congress receive.

Mr. Blunt praised the plan to open 8.3 million acres in the Gulf of Mexico to oil and gas drilling.

Under the bill passed by the House, oil companies will be able to lease 8.3 million acres of federally owned land in the Gulf of Mexico for the production of oil and natural gas.

The bill also creates a new revenue-sharing formula between the Gulf States — Alabama, Texas, Mississippi and Louisiana — and the federal government.

Under the new formula, 37.5 percent of the royalties from oil and gas leases would go to the Gulf Coast states, with Louisiana getting the lion’s share of the profits. Another 12.5 percent would go to a land and water conservation fund for the states to recoup coastal wetlands, and the remaining 50 percent would go to the federal government.

Floridians, who have historically fought against offshore drilling in the Gulf, satisfied themselves with a special provision that sets up a 100-mile moratorium on drilling from their beaches.