Senate Approves Bush Budget Plan

W A S H I N G T O N, April 6, 2001 -- The evenly divided Senate voted 65-35 to approve President Bush's budget plan today, but only after it moved to trim his mammoth tax-cut proposal by $400 billion.

Bush brushed aside the reduction, claiming victory in the budget battle.

"The result will be the largest tax relief in decades," he said during an East Room ceremony at the White House. "I applaud today's action."

The adoption of the 10-year blueprint for government spending capped a week of often-spirited debate and intense legislative maneuvering on the Senate floor, particularly over Bush's plan to cut federal income taxes by $1.6 trillion over the next decade.

Dems Trim Bush Tax Cut

Bush and his GOP allies in the Senate argued the tax-relief measure was necessary to revive the flagging economy, while Democratic critics charged the cut would squander expected budget surpluses and necessitate deep cuts in funding for many key domestic spending priorities, including health care and education.

Democrats led a successful effort earlier this week to shrink the tax cut to $1.2 trillion — $400 billion less than the president sought. A Republican effort to restore the $400 billion in tax relief was defeated on a 49-51 vote after two GOP senators crossed party lines to oppose the measure. A lone Democrat voted in favor of it.

Though the budget resolution is nonbinding and has often been ignored in previous Congresses, today's much-anticipated vote provides an important measure of support for the president's economic agenda in the Senate where, given the 50-50 split between Republicans and Democrats, every vote matters.

In the final vote today, all 50 Senate Republicans were joined by 15 Democrats in voting for the budget outline. Its adoption laid the groundwork for Bush's efforts to enact his plan to slash marginal tax rates across all levels of income.

Both Sides Claim Victory

The White House and leading Republican senators hailed the vote as a crucial victory for the president as his administration approaches the 100-day benchmark.

Vice President Dick Cheney asserted his constitutional authority as Senate president and gaveled today's final vote.

"It constitutes major progress," he said afterward. "It's been a good week for the American people."

Sen. Pete Domenici, R-N.M., chairman of the Budget Committee said the vote all but guaranteed that sweeping tax relief would soon be enacted.

"This vote means that help is on the way," he said. "To those who have been waiting for a stimulus, waiting for a permanent marginal rate cut, help is really on the way because we can't avoid it now … This is an exciting day."

But Democrats who opposed the resolution also claimed victory, citing their successful effort to trim Bush's tax plan.

"I think it is dead," Minority Leader Tom Daschle of South Dakota said of the original $1.6 trillion proposal. "If this is a victory for them, we'd like to see more victories like it."

"We started with a package that had a tax cut … that was so large that it crowded out other important priorities including paying down the debt, additional resources for education and a prescription drug benefit [for Medicare]," added North Dakota Democrat Byron Dorgan. "Improvements have been made in all of those areas as a result of our efforts."

The resolution passed today sets the federal budget for 2002 at $1.98 trillion. That spending level represents a 7 percent increase in "discretionary" spending — rather than the 4 percent increase sought by Bush — over the $1.91 trillion 2001 budget passed and signed last year by President Clinton.

With the House having approved a budget resolution last week that included the full $1.6 trillion tax cut, the matter will now head to conference, where a panel of senators and representatives will attempt to hash out differences between the two sets of spending guidelines.

The president is expected to send his full budget proposal to Congress on Monday.