The Note: And the Benny Goes to . . .

On the House-passed transportation bill yesterday, Notes the Wall Street Journal's Sarah Leuck: "The House bill still contains a provision that drew a White House veto threat: a clause that would allow Congress to reopen the bill. The provision could open the way for lawmakers to insert more special projects, and would require Congress to revisit the issue of how federal Highway Trust Fund dollars are distributed between states or risk delaying fiscal 2006 highway funding until after the construction season begins."

The vote on this was 417 to 9, so we guess the ranks of hard-core budget-cutters in the Congress is less than a baker's dozen . . . what, with the 4128 earmarks and all. Rep. Flake, call your office. LINK

We don't quite understand how the veto threat will play out.

And on the Senate side, reports Joel Havemann of the Los Angeles Times, a $2.6 billion budget that preserves tax cuts and puts the deficit at $362 billion made it thought the Budget Committee. Meanwhile, fiscal conservatives in the House are squeaky-wheeling it, demanding a new procedure to keep spending bills from busting the budget. LINK

The New York Times' Stolberg and Kirkpatrick on GOP Senators divided over Medicaid cuts, and the passage of Sen. Corzine's non-binding amendment that expresses the desire to not increase a state's Medicaid burden. LINK

Judd Gregg has ice water in his veins.

The Wall Street Journal's Greg Ip on Chairman Greenspan's latest deficit warnings: "Federal Reserve Chairman Alan Greenspan, continuing his warnings over the federal deficit, said the budget shortfall is a larger risk to the U.S. economy than the gaping trade deficit or large household-debt burdens."

"'Our fiscal prospects are . . . a significant obstacle to long-term stability, because the budget deficit is not readily subject to correction by market forces that stabilize other imbalances,' Mr. Greenspan said in a speech to the Council on Foreign Relations in New York."

The Congress:

The New York Times perky Carl Hulse looks at the divide on the other side of the aisle over bankruptcy, with Sen. Carper and John Podesta (and Tom Harkin) at loggerheads about substance and symbolism. LINK

Jennifer Brooks of Gannett News Service details the bankruptcy bill that made it through the Senate last night. LINK

If you hadn't noticed it, a coalition of center-left, libertarian, and even some conservative blogs waged an unsuccessful campaign to block the bill.

John Harwood's Washington Wire in the Wall Street Journal Notes: "After success on bankruptcy and class-action legislation, business lobbyists want to maintain momentum with progress on Central American trade expansion, energy incentives, extension of capital gains and dividend-tax relief. Quick work is seen as vital before budget issues draw lawmakers' attention. One potential casualty: the asbestos bill. Pennsylvania's Specter cancels Senate Judiciary Committee vote after consensus eludes fellow Republicans. If Republicans exercise "nuclear option" against judicial filibusters, Democrats have threatened to halt floor action."

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