Senate passes bill to cut spending
Washington ? The Senate on Thursday narrowly approved the first cuts since 1997 to benefit programs such as Medicare, Medicaid and farm subsidies, giving Republicans a modest victory against ever-rising government spending.
The bill, passed by a 52-47 vote, makes mild cuts to the health care programs for the elderly, poor and disabled, but leaves the food stamp program untouched.
The measure also permits exploratory oil drilling in an Alaskan wilderness area. Five Republicans in the GOP-controlled Senate who oppose the drilling vote against the bill.
“The Senate took an important step forward in cutting the deficit,” President Bush said in a statement issued in Mar del Plata, Argentina, where he is attending a conference. “Congress needs to send me a spending-reduction package this year to keep us on track to cutting the deficit in half by 2009.”
The spending battle now heads to the House, where Republicans are divided over whether to cut more deeply across a broader range of social programs. Also, House GOP leaders may remove a provision that allows drilling in the Arctic National Wildlife Refuge.
The long-planned budget measure would make the first cuts to mandatory programs since 1997. These programs account for 55 percent of the budget and include Medicare, Medicaid, farm subsidies and student loan subsidies.
“After years of allowing spending to grow unchecked, I am gratified to see the Senate take a step in the right direction toward serious fiscal discipline,” said GOP Sen. Judd Gregg, of New Hampshire, chairman of the Senate Budget Committee.
Despite strongly supporting the overall effort, the White House has threatened to veto the bill over an obscure proposal to kill subsidies for some regional health insurers that offered Medicare prescription drug coverage. The White House’s stand threatens $5.4 billion in savings.
Democrats generally opposed the bill because it allows the oil drilling and increases the deficit when coupled with a $70 billion tax cut bill.
“Their budget … actually would make the deficit worse,” said Senate Minority Leader Harry Reid, D-Nev. “That’s fiscally irresponsible at any time, but especially when we should be saving to prepare for the baby boomers’ retirement.”
Yet Republicans did pick up the support of two Democrats, Sen. Ben Nelson, of Nebraska, and Mary Landrieu, of Louisiana, whose hurricane-devastated state won emergency aid under the bill.
It appears increasingly likely that protests from moderates will force House GOP leaders to drop the oil drilling plan and revisit it in final compromise talks with the Senate.
The Senate Republicans who opposed the budget bill over the drilling issue were Norm Coleman, of Minnesota; Susan Collins and Olympia Snowe, of Maine; Lincoln Chafee, of Rhode Island; and Mike DeWine, of Ohio.
The bill reflects the influence of moderates who provided swing votes in the full Senate and in Senate Finance Committee, which came up with proposals to curb the growth in Medicaid and Medicare.
As a result, the Senate’s cuts largely protect beneficiaries of the programs, while turning to drug companies, pharmacies and insurance subsidies for much of the savings. The Agriculture Committee, meantime, dropped plans to cut food stamps.
Still, there is plenty of sugar to go along with the fiscal medicine. The bill contains about $35 billion in new spending to go along with the cuts:
¢ Doctors would get an $11 billion reprieve next year from a scheduled 4.3 percent cut in their Medicare payments.
¢ Dairy farmers won a $1 billion extension of milk income payments.
¢ College students would get more than $8 billion in new grants.
¢ More disabled children would retain Medicaid health coverage.
At the beginning of Thursday’s debate, Senate Majority Leader Bill Frist, R-Tenn., withdrew a $4 billion plan to combat avian flu, fearing Democrats would try to add even more.
Other provisions of the Senate measure include:
¢ $10 billion in new revenues from auctioning analog television spectrum to wireless companies.
¢ More than doubling the premiums paid by corporations to the financially troubled Pension Benefit Guaranty Corp.







